India made a pitch for stronger energy and trade ties with Sri Lanka on Friday, while external affairs minister S Jaishankar emphasised the importance of fully implementing measures to protect the interests of the Indian-origin Tamil minority.
India and Srilanka sign Memorandum of Understanding on India’s grant assistance for community projects
The two countries signed a memorandum of understanding on Indian grant assistance for community projects focused on education and health during Jaishankar’s meeting with President Ranil Wickremasinghe in Colombo.
Jaishankar also took part in the virtual inauguration of a dance academy and the handover of 350 houses built with Indian assistance.
India becomes Srilanka’s first creditor to back its debt restructuring program
Jaishankar arrived in Colombo shortly after India became the first of Sri Lanka’s creditors to support the country’s debt restructuring plan by sending financial guarantees to the International Monetary Fund (IMF). The three main creditors of the crisis-hit island country are China, India, and Japan. Because China and India are not members of the Paris Club, Sri Lanka must secure financial guarantees in order to receive a bailout package from the IMF.
Jaishankar “India will stand by Srilanka in its hour of need”
During a joint press conference with Sri Lankan Foreign Minister MUM Ali Sabry, Jaishankar stated that India will be there for Sri Lanka in its hour of need“I would like to underline that India is a reliable neighbour, a trustworthy partner, one who is prepared to go the extra mile when Sri Lanka feels the need,”
Jaishankar “India practices neighborhood first policy”
Jaishankar emphasised the importance of strengthening ties between the two countries in energy, trade, and investment to help Sri Lanka recover from an unprecedented economic crisis. He noted that India extended $4 billion in credit and rollovers to help Sri Lanka get through the crisis, calling it a “neighbourhood first” issue.
“India will encourage greater investments in the Sri Lankan economy, especially in the core areas like energy, tourism and infrastructure. “We expect the Sri Lankan government to create a more business-friendly environment in order to create a powerful pull factor,” he said. The use of rupee settlement for trade would be in both countries’ best interests, he added. he said. The use of rupee settlement for trade would be in both countries’ best interests, he added.
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Trincomalee to emerge as an energy hub
According to Jaishankar, Sri Lanka’s quest for energy security must “encompass the larger region,” and Trincomalee can emerge as an energy hub. India is prepared to be a dependable partner for such initiatives, and the two countries have reached an in-principle agreement on a renewable energy framework, he added. Last year, Sri Lanka signed a long-term agreement with an Indian Oil Corporation (IOC) subsidiary to develop the Trincomalee oil tank farm, an 850-acre storage facility with a capacity of nearly one million tonnes.
Steps discussed to make Srilanka’s Tourism Industry more sustainable
Jaishankar stated that the two sides can take additional steps to ensure the sustainability of Sri Lanka’s tourism industry, such as improving connectivity, encouraging Indian tourists to make RuPay payments, and utilising UPI. The largest source of tourist arrivals in Sri Lanka is currently India.
Jaishankar brings up India’s long standing demand for further measures to protect interests of SriLanka’s minority
He also brought up India’s long-standing demand for additional measures to protect the interests of Sri Lanka’s Tamil minority further he stated without giving details“India has always supported both the political and economic stability of Sri Lanka. The president briefed me on the question of political devolution and his thinking,”.
He stated that he had shared India’s “considered view that the full implementation of the 13th amendment and early conduct of provincial elections are critical”. He added “Durable efforts towards reconciliation are in the interests of all sections in Sri Lanka. I also spoke of the need to pay special attention to the requirements of the Indian-origin Tamil community.”
Jaishankar’s visit seen as an opportunity to reset relationship with Sir Lanka
Jaishankar’s visit is also seen as an opportunity to repair ties with Sri Lanka, which were strained last year when Colombo allowed the Yuan Wang 5, a surveillance vessel of China’s People’s Liberation Army (PLA), to replenish at the Chinese-controlled Hambantota port. Officials on both sides have acknowledged that the development has created a trust deficit, particularly given India’s border standoff with China.
China drags its feet on providing financial assurances for Srilanka’s debt restructuring programs
While China has been slow to provide financial guarantees for Sri Lanka’s debt restructuring programme, sources close to the situation say India has been more forthcoming.
India believes Sri Lanka’s creditors “must take proactive steps to facilitate its recovery,” according to Jaishankar. “India decided not to wait on others but to do what we believe is right. We extended financing assurances to the IMF to clear the way for Sri Lanka to move forward. Our expectation is that this will not only strengthen Sri Lanka’s position but ensure that all bilateral creditors are dealt with equally.”
Sabry emphasizes on India’s role in Sri Lanka’s recovery
Sabry emphasised India’s role in the recovery of Sri Lanka, saying: “It is no exaggeration to say that it was for the most part due to the enormous support amounting to $4 billion worth of credit lines provided by India, for the import of essential goods as well as other in-kind humanitarian assistance, that we were able to regain some measure of economic and financial stability.”
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