For decades India has inexorably been involved in Sri Lanka’s path to progress, often positively and on a few occasions negatively. It was in the mid-1980s that India infamously provided refuge to Sri Lankan militant groups (training in Tamil Nadu) but that changed in 1987 with Indian troops roped in to end the conflict. In [...]
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In recent years, India has been a friend – helping financially and in other ways, like for example the support for COVID-19 relief and in the aftermath of Cyclone Ditwah.
The island nation has hosted many Indian leaders including Prime Minister Narendra Modi and Foreign Minister Dr. S. Jaishankar among others. Foreign investment by Indian entrepreneurs has been on the rise.
Tourist arrivals from India have reached record highs with our ‘friendly’ neighbour being the biggest tourism source market for Sri Lanka. In October 2026 arrivals from India totalled 62,211, accounting for about 37 per cent of the monthly total arrivals while from January to October 2026, Indian arrivals totalled 499,625 visitors.
There have been multiple visits by Indian trade delegations, increasing trade and investment and this is the reason for today’s column: This year, India has ousted the United Kingdom (UK) as Sri Lanka’s second largest buyer, second only to the United States (US). The UK had for decades been Sri Lanka’s second largest buyer.
Many years ago, one could not have fathomed that Sri Lankan exports to India would grow by leaps and bounds particularly since India has rigid rules and regulations for incoming imports. Some years ago, the late Mineka P. Wickramasinghe, founder of Ceylon Biscuits Ltd tried to enter the Indian market without success. Later the company succeeded.
Recently Maliban Biscuits entered the market through a strategic partnership with Reliance Consumer Products Ltd (RCPL), a subsidiary of Reliance Retail. While ITC Ratnadipa is an Indian-owned hotel, the controversial and uncertain Krrish mixed-development project has marred relations between the two countries.
On the positive side, Sri Lanka’s exports to India and the surge in Indian tourists to Sri Lanka have enormously benefitted the Sri Lanka economy. To get a better understanding of this relationship, I called Ruwanputha , my young economist-friend.
“India is now a key partner in Sri Lanka’s progress,” he said, responding to a question on where he sees this partnership moving to. “In many ways, India has helped Sri Lanka in tourism particularly since there have been difficulties for Europeans to visit as they use airline transit hubs in West Asia which have been affected by the US-Iran war,” I said.
“The trade ties have been smooth and efficient. Sri Lanka has successfully managed the somewhat difficult rules in India to increase our exports,” he said. “A negative point, however, is that the balance of trade is still heavily in favour of India,” I said. According to 2025 trade figures, India’s exports to Sri Lanka totalled US$4.88 billion, whereas Sri Lanka’s exports to India totalled $1.4 billion with the balance of trade at $3.25 billion being in India’s favour.
It was that time of the day that I relished a second mug of my favourite brew – tea. Walking to the kitchen, for the second week in succession, Aldoris , the choon-paan karaya had arrived in the neighbourhood as there were piping hot ‘Maalu paans’ on the table. Picking up one and the mug of tea, I walked back to the office room but on the way distinctly heard the conversation under the margosa tree by the trio.
“Matha bedayak athiwela thiyenawa hamuduru namak gena. Eh swamin wahanselu janadhipathita kiyanney thava swamin wahanse kenekta samawa denna kiyala (There is some controversy about a Buddhist monk who has been urging the President to pardon another monk),” said Kussi Amma Sera . “Mama hithanney eh swamin wahanseta viruddawa thiyena chodanawa eyata pavulak innawa kiyala (I think the allegation is that he (monk) has a family),” noted Serapina . “Den mae kathawa digin digitama yanawa (This story is gaining momentum),” added Mabel Rasthiyadu .
Back to the India-Sri Lanka relationship progress: India’s exports to Sri Lanka are made up of Petroleum and Mineral Fuels; Vehicles & Transport; Food and Cereals; Pharmaceuticals; Textiles and Cotton; and Machinery and Steel while Sri Lanka’s exports to India consist of Pepper and Spices; Animal Feed; Petroleum and Mineral Oils; Tea and Coffee; Arecanuts; Apparel and Women’s Outerwear; Pulp of Wood, Paper and Waste/Scrap Paper; Furniture and Seats; and Ships and Boats.
For the record, Sri Lanka’s export sector reached the $12 billion mark in the first eight months of 2026, with total exports reaching $12.01 billion, an increase of 4.26 per cent compared to $11.52 billion recorded during the corresponding period of 2025, according to the Export Development Board.
This was mostly made up by the US nearly $2 billion worth of goods, India $776 million and UK $582 million. Last year, the country’s top three buyers were the US (24.2 per cent share of total exports), the UK (7.5 per cent) and India (7.3 per cent), while this year India has entered the picture as the second largest buyer. While exports to India surged in August 2026, exports to the UK declined by 7.65 per cent year-on-year.
Many of Sri Lanka’s chambers have found success after multiple visits to India and also hosting visits by chambers from there. The Ceylon Chamber of Commerce has played a key role in this area, dealing with and having MOUs with the Confederation of Indian Industry (CII) and the Indian Chamber of Commerce (ICC). The recent economic summit by the Ceylon Chamber resulted in the presence of many Indian trade delegations.
Colombo has also been a ‘safe’ refugee for Pakistan trade and investment delegations attending regional conferences where India plays a big role. Due to the ages-old animosity between India and Pakistan and with the regional body – the South Asian Association for Regional Cooperation (SAARC) – being a toothless tiger, Colombo has offered a pleasant environment for regional discussions including these two countries.
If called upon, the now-peaceful isle of Sri Lanka can play a key role as a ‘peace mediator’ in regional conflicts. While that role is sure to emerge in the future, Sri Lanka’s exports and trade with India is heading for a positive future.
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Print Edition – The Sunday Times, Sri Lanka
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