India to invest $2 billion in Sri Lanka over 3-4 years

Updated - September 27, 2016 11:31 pm IST

Published - September 27, 2016 11:29 pm IST - COLOMBO:

Commerce Minister Nirmala Sitharaman.

Commerce Minister Nirmala Sitharaman.

India will invest $2 billion in Sri Lanka in the next three-four years, Commerce and Industry Minister Nirmala Sitharaman said on Tuesday.

Ms. Sitharaman, who was here for talks on the Economic and Technological Cooperation Agreement (ETCA), called on Prime Minister Ranil Wickremesinghe and later met senior Ministers to discuss the terms of the agreement.

“Of course, there are issues that will have to be sorted out in good detail,” she said, adding that while opportunities exist, it was important to recognise that the negotiations had to be done in detail.

Unsuccessful CECA

The ETCA initiative follows unfruitful negotiations, spanning nearly a decade, on a Comprehensive Economic Partnership Agreement (CEPA) between the neighbours. India and Sri Lanka already have a Free Trade Agreement since 1998.

Both New Delhi and Colombo are keen on signing the ETCA, though there is considerable opposition to it within Sri Lanka, coming both from a section of medical and IT professionals, and from trade unions. Sri Lankan businessmen too have raised concerns over the trade agreement, Ms. Sitharaman said, adding India was “willing to sit and talk to them”. Asked about negotiations over non-tariff barriers, she said India viewed them along with standards, sanitary and phytosanitary measures.

‘One whole market’

On taxation, Ms. Sitharaman said the passing of the Goods and Services Tax Bill made India one whole market. Sri Lanka’s Minister of Development Strategies and International Trade Malik Samarawickrama said the two countries will complete negotiations “as soon as possible”, amid speculation that the pact might be inked by December this year.

The second round of negotiations on the ETCA is scheduled to take place in New Delhi on September 29 and 30.

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