Indian investors eye Sri Lanka’s economic resurgence

Amid Sri Lanka’s journey toward economic recovery, Indian investors and businesses are closely monitoring the emerging opportunities in the local market said Vice Chairman of the Indo-Sri Lanka Chamber of Commerce and Industry (ISCCI) Dr. Naresh Bana. (Pictured)

Despite strong tourism ties, Indian investment in Sri Lanka’s tourism sector remains cautious. “Indian investors, like their counterparts elsewhere, rely on credible data, projections and business prudence.”

The country’s credit rating challenges, influenced by banking and financial institutions, often determine the final investment decisions. However, trading relations between the two nations remain robust. On recent economic reforms, Dr. Bana highlights Sri Lanka’s efforts to diversify investment instruments through municipal bonds, real estate investment trusts (REITs), and SME listings.

“These initiatives, if executed effectively, could accelerate economic growth,” he states, adding that Indian businesses are observing these developments while awaiting more consistent, reliable data to guide their decisions. The ISCCI plays a crucial role in building Indo-Lankan economic ties. “We assist companies in securing industry tie-ups, facilitate bilateral trade, and disseminate policy-related information,” Dr. Bana shares. The Chamber’s initiatives aim to create a supportive environment for Indian investors and help Sri Lankan businesses establish a foothold in India.

The Blue Economy presents significant collaborative potential for India and Sri Lanka. With expansive coastlines, the two nations can leverage marine resources for mutual benefit. Dr. Bana outlines key areas for cooperation, including Marine Domain Awareness (MDA) and maritime security, Fisheries and aquaculture, offshore energy, including hydrocarbons and wind farms, Maritime trade and connectivity, Tourism and marina development and Research and innovation.

“Collaboration in these areas would unlock economic and ecological benefits for both nations.”

India remains Sri Lanka’s largest trading partner, with bilateral trade reaching $5 billion in 2023. The relationship is anchored by India’s ‘Neighborhood First’ policy, which includes development aid, credit lines, and infrastructure investments. The Tata Group, Bajaj, ITC Hotels, Indian Oil and Airtel have significant investments in telecommunications, automotive, petrolium leisure and financial services and have established a robust presence across Lanka’s economy Additionally, the Adani Group has made strategic investments, including the development of the Colombo West International Terminal and the acquisition of Singha Cement.

All these ventures underline the strengthening economic ties and mutual business interests between India and Sri Lanka.

Source: Daily News