India and Sri Lanka Signed Seven Pacts

On 09 June 2010, India and Sri Lanka signed seven pacts and MoUs in New Delhi during 3-day visit of Mahinda Rajapaksa to India.

• The two nations signed the pact on establishing Talaimannar-Madhu rail link.
• Both nations signed a treaty on mutual legal assistance in criminal matters and MoU on transfer of settled prisoners.
• They renewed MoU on SDP scheme and agreed to set up a centre to rehabilitate war widows.
• The two nations also signed a MoU to renew the cultural exchange programme between the two countries.
• Two MoUs were signed to exchange convicted persons of both sides and to provide each other legal assistance to improve the cooperation between the two countries.
• A MoU to interconnect electricity grids of the two nations. This will result into supply of 1000 MW to Sri Lanka whose power infrastructure is in bad shape post the LTTE war. Deep sea power cables will be established to interconnect the grids of the two countries.
• MoU to set up a Woman’s trade facilitation and community learning centre with help from SEWA, a NGO based in Ahmedabad.

Visiting Sri Lankan President confirmed his nation’s support for India’s candidature for non-permanent seat In UN Security Council for the year of2011-12 and India’s bid for permanent seat in the council.

Besides, the two nations discussed plans for the rehabilitation of displaced ethnic Tamils in Sri Lanka post LTTE war and peaceful solution to the issue of ethnic Tamils based upon 13th amendment in Sri Lankan constitution. Both nations also discussed Comprehensive Economic Partnership Agreement already proposed between them but not finalised yet because of protest by the opposition parties in Sri Lanka. The two sides already have Free Trade Agreement (FTA) between them.

• FTA is a kind of agreement between two countries under which tariff is reduced or removed during bilateral trade between the two sides.
• India was Sri Lanka’s largest trading partner in 2008 and second largest investor in the island nation.

Maintaining good relationship with Sri Lanka is significant for India because at several world forums like UN and SAARC they work together and Sri Lankan support is essential for India. Moreover, Sri Lanka is a close neighbour of India and the two nations share strong cultural and ethnic bonds. Besides, the strategic location of Sri Lanka in Indian Ocean makes it both strategically and economically important for India. If any other country like China gains influence in Sri Lanka it would exert pressure on India using Sri Lanka as a base.