Talks on trade, power, China on the cards as Sri Lanka president visits India
New Delhi: India and Sri Lanka are expected to discuss economic connectivity and China during the visit of president Ranil Wickremesinghe, who arrives in New Delhi today. This is Wickremesinghe’s first visit to India since taking office after his predecessor, Gotabaya Rajapaksa, was swept from power after mass protests in 2022. The visit comes even as Sri Lanka continues to grapple with a protracted economic crisis.
Inflation remains high at 25.2% despite cooling since January, according to the country’s central bank. The International Monetary Fund (IMF) has forecast that Sri Lanka’s economy is expected to contract 3.1% in 2023. Millions have been plunged into poverty as the country’s economy has struggled.
Wickremesinghe has spent much of his year in office pushing painful economic reforms. His government has raised taxes, hiked interest rates and has also batted for the privatization of state-owned banks and airlines. India moved quickly to help Sri Lanka stabilize its economy and provided close to $4 billion in assistance to the island nation.
This included credit lines for the purchase of food and essential medicines as well as currency swap arrangements. India also provided financing assurances to the IMF as it mulled a $2.9 billion bailout for Sri Lanka, which was eventually approved in May 2023. As Wickremesinghe visits Delhi, economic matters may be foremost on the agenda.
Both sides are expected to explore avenues to increase trade, through settlement in national currencies among other proposals. Sri Lanka will also be looking for increased investment from India. In the leadup to the visit, Tata Sons Chairman N Chandrasekaran visited the country.
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