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| India Eco Summit: Sri Lanka woos foreign investors |
| Nayanima Basu / New Delhi Nov 10, 2009, 00:57 IST |
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The country is also looking to invest in India’s banking, financial services and tourism sectors.
Sri Lanka is entering a new phase of economic growth after the recent resolution of the conflict with the Tamil Tigers separatist group. It is aggressively seeking to make the region investor- friendly for global businesses.
It is also seeking to invest in India’s banking, financial services and tourism sectors. Two of the country’s leading hotel chains – John Keells and Aitken Spence – are planning a major foray each into India. Other details of the investment could not be ascertained.
The integration of the two provinces where the Tamil Tigers based its operations is also important to the country’s future economic growth. Sri Lanka has been growing at an average of 5 per cent per year for nearly a decade.
In the last five years, its per capita GDP has doubled. At the end of 2008, GDP per capita stood at $2,000, which the country hopes to increase to $5,000 in the next five years.
The country’s main USP remains its vast stretch of rich natural resources and it is currently focusing on creating state-of-the-art, world-class infrastructure in order to create an environment that is conducive for investors and businessmen.
“We are making unprecedented investments in the infrastructure sector, from ports to roads and the railway network. We have at present an infrastructure portfolio of $2 billion. This will be the main driver of our GDP (gross domestic product) growth,” said Sarath Amunugama, minister of public administration, home affairs and deputy minister of finance and planning, Sri Lanka.
To facilitate growth, Sri Lanka’s aid architecture has been transformed; traditional donors in the West have been supplanted by India, China, Japan, Iran and Libya. Located midway between the Middle East and East Asia, Sri Lanka is well positioned to become a hub for financial services, IT and telecom.
The minister said that the country’s proximity to India gives it an edge over other countries in terms of trade and investment. He, however, expressed concern over India’s high level of duties.
“We are trading almost 7,000 items as part of the free trade agreement (FTA). While Indian goods are easily flowing into Sri Lanka without any customs duties, our products are facing high levels of taxes and duties, and this has become a major cause of concern,” the minister said.
The minister also underscored the need to strengthen the South Asian Association for Regional Cooperation (SAARC) for the development of the region. The country also has trade ties with Pakistan, Japan and Korea. “We should make the best use SAARC and should also look at expanding our relationship with Asean,” Amunugama said.
The country also claims to have a large pool of skilled manpower and is now actively engaged in the facilitating the return of more than 4,000 internally displaced persons (IDPs), for which it has received international aid.
Total trade between India and Sri Lanka stood at $3,457.97 million in 2007-08, including exports worth $2,826.54 million and imports topping $631.42 million.
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