India-Sri Lanka Commercial Diplomacy

South- East Asia Regional Collaboration 

By Srimal Fernando

India’s rising leadership role in the region and within the various membership forums such as the Association of Southeast Asian Nations (ASEAN) and the South Asian Association for Regional Cooperation (SAARC), makes it relevant to strengthen partnership and protect common interests of India and its southern neighbour, Sri Lanka.

The increasing interdependencies of India and Sri Lanka across many fronts are established on common strategic interests. This examination attempts to explain Sri Lanka’s new foreign policy direction in the light of its increasing importance for South-and East Asia regional collaboration mainly focusing on the commercial diplomacy between Sri Lanka and India

South Asia – India and Sri Lanka

 India being the largest nation in the region considers Sri Lanka important for its own geo-political and trade interest and in promoting Neighbourhood First Policy and SAGAR doctrine. The evolving geo-political concerns in South Asian region have prompted India to forge a deeper commitment to Sri Lanka. Trade instruments like the South Asian Free Trade Area (SAFTA) and the Indo-Sri Lanka Free Trade (ISFTA) agreements are some of the gainful tools with which the ASEAN nations can use to access South Asia’s consumer markets.

ASEAN – India

India, with its current foreign policy of Act East is powerfully positioned among the Association of Southeast Asian Nations (ASEAN) countries Furthermore; ASEAN-India cooperation has taken a huge leap as they successfully signed a free trade agreement, namely the ASEAN-India Free Trade Area (AIFTA) that came into force in 2010. India’s evolving position as a major Asian power is creating a major link for ASEAN nations to gain greater access to the other eight South Asian Association for Regional Cooperation (SAARC) countries.

The 17th ASEAN-India summit has taken India’s relations with the 10-nation Association of Southeast Asian Nations (ASEAN) to a whole new level, reinforcing cooperation across multiple sectors.

Sri Lanka following India in 2018 has entered into a free trade agreement with Singapore known as the Sri Lanka-Singapore Free Trade Agreement (SLSFTA). The SLSFTA reduced tariffs between the two countries by up to 80% cementing their by relationship.

Neighbourhood First and Sri Lanka’s India First

 In 2000 when the Indo Sri Lanka Free Trade Agreement (ISFTA) was implemented, Sri Lankan bilateral trade with its large neighbour has expanded generously. However Sri Lanka was among the leading trading partners in the SAARC region.

Sri Lanka’s foreign policy as an island nation should be to promote its national interest in synchrony with mainland India without compromising its relations with other major nations

With the new India First approach doctrine, Sri Lanka does not aim to jeopardise India’s ongoing strategic security interests in the India Ocean realm. The main aim of the policy is to create a shift in global order wherein Sri Lanka would no longer be reliant on a West-oriented policy.

As Sri Lanka’s closest neighbour, the new strategic security policy has an ‘India first’ approach though Colombo remains open to dealing with other key players. This new approach can influence trade, aid and maritime security that requires a new impetus in this era.

Indo – Pacific Foreign Policy

The US considers Sri Lanka as a gateway to the Indian Ocean and a key partner in the Indo-Pacific region. Its proximity to India, and being an island nation provide Sri Lanka with strategic importance in maintaining their political and economic interdependence. The location of India and Sri Lanka in the centre of the Indian Ocean can positively impact the economic future of the countries.

Conclusion

South Asia and East Asia are some of the world’s fastest growing regions.

All these mutually beneficial agreements are bringing South Asian Association of Regional Cooperation (SAARC) and ASEAN closer as these agreements are increasing the volume of trade between these regions by including inter and intra trade.

Historically, India has stood by Sri Lanka at the latter’s hour of need, and today it still abides by this policy by being a reliable partner and by helping ease the island nation’s economic burden. Therefore, Sri Lanka considers India as its most trusted and closest external partner which guarantees it with security and progress.

This opinion piece gives the views of the author, and not the position of the governments.

[Dr. Srimal Fernando is a recipient of the prestigious O.P Jindal Doctoral Fellowship and the SAU Scholarship under the SAARC umbrella. He is also an Advisor/Global Editor of Diplomatic Society for South Africa in partnership with DiplomaticWorld Institute (Brussels). He has also received accolades such as 2018/2019 ‘Best Journalist of the Year’ in South Africa, (GCA) Media Award for 2016 and the Indian Council of World Affairs (ICWA)accolade. He is the author of upcoming book Politics , Economics  and Connectivity : In Search of South Asian Union” ]