New Delhi: In an effort to attract investment from both India and Pakistan following the victory of its armed forces over the Tamil Tiger rebels, Sri Lanka has pitched itself as a meeting ground for businesses from the two nations.
Sri Lanka, which has free trade agreements (FTAs) with both India and Pakistan, intends to become a services hub, Sarath Amunugama, the island nation’s minister for public administration and home affairs, said at the World Economic Forum’s India Economic Summit in New Delhi. “Sri Lanka is a very good base where the two countries can meet,” he said. “We can also serve the Far East from there. We have a tremendous hub position.”
Sri Lanka declared victory in May over the the Liberation Tigers of Tamil Eelam (LTTE), ending a decades-old separatist conflict. The island is courting investment as it attempts to boost growth.
According to Sri Lanka’s Board of Investment, the FTAs with both India and Pakistan provide access to around 1.3 billion consumers. While the India-Sri Lanka FTA provides access for 4,200 products to India, the Pakistan-Sri Lanka pact provides access for 4,500 products to Pakistan.
The major shipping routes connecting the Far East, South Asia and the Pacific to the rest of the world also touch Sri Lanka.
India and Sri Lanka are expected to sign a new pact covering services. A comprehensive economic partnership agreement is being discussed, Amunugama added. The island nation has been a key export destination for Indian firms. A case in point is India’s auto exports, which in 2007-08 had risen to $249.19 million (Rs1,161.2 crore), five times the $45.27 million figure in 2001-02, according to the Federation of Indian Chambers of Commerce and Industry.
“We have seen a growth of around 5% per year with our per capita GDP (gross domestic product) doubling in the last five years to a little over $2,000 per capita,” said Anura Ekanayake, chairman, Ceylon Chamber of Commerce.
The Sri Lankan minister also articulated his country’s position on integrating Sri Lankan Tamils into the mainstream following the end of the civil war. Answering a question about addressing Tamil grievances in the north and eastern part of the island, he said, “A disproportionately large part of the forthcoming budget will be towards the north and east.”
The minister said the conflict was to do with the rebel group and not the wider Tamil population. “This battle was with the LTTE and not with the Tamil people and Tamil brethren. We will enforce the 13th amendment. Sri Lanka must be a fair country,” he added.
Under the 13th amendment to the constitution, the government agreed to devolve a wide range of powers to provincial councils.
However, analysts are not convinced. “Majority Sinhala chauvinism still resonates in current politics where the legitimate rights of the Tamil population are being camouflaged in the politics of tokenism. The 13th amendment should be a part of a larger framework of engagement,” said Shweta Singh, assistant professor, conflict transformation and peace building programme, Lady Shri Ram College, commenting on Tamil-Sinhala relations.