India-Srilanka Relations: Evolution, Cooperation Areas, Challenges & Recent Developments

Due to the strategic location of Sri Lanka, many major powers have raced to claim their own interests in the nation. Currently, China is making use of Sri Lanka as a part of its BRI and string of pearls strategy. India too sees the significance of bilateral ties with the island nation. India and Sri Lanka’s bilateral ties are thousands of years of old, characterised by common culture, tradition and history. India, to counter China and create a balance of power in the region, must ensure close diplomatic ties with smaller neighbours like Sri Lanka.

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How did it all begin?

  • The bilateral relationship between India and Sri Lank is more than 2,500 years old since both the nations have a legacy of intellectual, cultural, religious and linguistic interactions.
  • In recent years, the diplomatic relationship is characterised by close contacts at all levels, leading to the growing trade and investment between the nations and cooperation in the fields of education, development, culture and defence.
  • India is also providing assistance in projects related to the development of the Internally Displaced Persons (IDPs) and the disadvantaged sections of the Sri Lankan population.

What happened during the Sri Lankan Civil War?

  • The Sri Lankan civil war came because of conflict and differences between Sri Lanka’s two major ethnic groups – Tamils and the Sinhalese, initiated even before Sri Lanka’s independence.
  • Many Tamils attended English language schools since they provided for greater opportunity for higher education and better employment opportunities during the colonial era.
  • Thus, the Tamil-dominated Northern Province had relatively better education and employment opportunities.
  • Following independence, the Sinhalese nationalism aimed to curb Tamils’ dominance in education and administration.
  • In1949, Tamils were marginalised in the country due to the rise of Sinhalese nationalistic activities.
  • The enactment of the infamous “Sinhalese Only Bill” in 1956 and constitutional provisions in the 1972 Constitution have discriminated Tamils, leading to the formation of Liberation Tigers of Tamil Eelam (LTTE) in 1972 and initiation of 1983 Civil War.
  • The bilateral relationship between India and Sri Lanka suffered in the 1980s with the rise of the Tamil Extremist militants in Sri Lanka and India’s implicit intervention during the civil war in Sri Lanka.
  • In 1987, to improve the diplomatic ties, the Indo-Sri Lankan Accord was signed between the two nations.
  • It called for a political solution to Sri Lanka’s conflict through the establishment of the provisional council system and devolution of the power of nine provinces in Sri Lanka.
  • Operation Pawan was also launched by India to perform peacekeeping mission in the country. This resulted in the assassination of the then Prime Minister Rajiv Gandhi.
  • After two years of military engagement, the Indian Peace Keeping Force was withdrawn due to its failure to defeat LTTE.
  • In 2009, the civil strife ended with the Sri Lankan government seizing the last area controlled by the rebels. India, during this time, agreed to reconstruct the war-torn areas and initiate rehabilitation programmes.
  • However, Tamil Nadu’s pro-LTTE governments have hindered the Central government decisions to provide humanitarian aid to Sri Lanka.
  • This along with India’s vote against Sri Lanka in 2009, 2012 and 2013 at the US-sponsored UN Human Rights Council resolution to investigate alleged human rights violation by Sri Lankan government against Tamil rebels led to the deterioration of the bilateral ties.

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The geopolitical importance of Sri Lanka:

  • Sri Lanka’s location in the Indian Ocean region has been a geopolitical significance to several major powers.
  • For instance, the island nation inked the British Defence and External Affairs Agreement in 1948 with the UK and the Maritime Agreement with the Soviet Union in 1962.
  • The US had at one point of time, chose Sri Lanka to build the Voice of America transmitting station. It is suspected to have been used to gather intelligence and electronic surveillance in the Indian Ocean.
  • China is currently making Sri Lanka as a part of its String of Pearl strategy to encircle India and dominate the Indian Ocean. Sri Lanka is now a part of China’s Belt and Road Initiative.
  • Since 2015, China has heavily invested in infrastructure projects in Sri Lanka, leading to its increased presence in the region.
  • Despite the losses due to the Hambantota port, China still invests in it due to the strategic significance.
  • Sri Lanka is housing some of the strategically significant ports located among the busiest sea routes.
  • Thus, Sri Lanka’s location makes it both commercially and militarily significant in the strategic point of view.

What are the areas of cooperation?

Political relations:

  • Sri Lanka, after its Civil War, had faced human rights allegations from the international community.
  • The geopolitical interests of the foreign powers influenced its domestic politics and international relations.
  • The diplomatic interactions between India and Sri Lanka have always been marked by high-level exchanges of visits frequently.
  • In February 2015, Sri Lanka’s newly elected President Maithripala Sirisena had officially visited India for the first time and Prime Minister Modi paid a return visit in March of the same year. This made him the first Indian Prime Minister to undertake a stand-alone visit to Sri Lanka in 28 years.
  • Sri Lanka, being the part of SAARC and BIMSTEC, is of significance to India’s Neighbourhood First Policy.
  • In June 2019, the first overseas visit of the Indian Prime Minister to Sri Lanka in his second term shows that the Neighbourhood First Policy has become the priority area for the Indian government.
  • BIMSTEC member nations were also invited to the Prime Minister Modi’s swearing-in ceremony to highlight aspect.
  • Though India’s is taking steps to improve the ties with Sri Lanka, China’s presence in the region makes it highly difficult.

Economic ties:

  • For India, Sri Lanka is one of the major trading partners among the SAARC countries while for Sri Lanka, India is the largest trading partner globally.
  • India’s exports to the island nation, between 2015 and 2017 stood at $5.3 billion and imports from the country were at $743 million.
  • Sri Lanka is also a priority destination for the direct investment from India.
  • India-Sri Lanka Free Trade Agreement (ISFTA) was signed in 1998 and had come to force in 2000. This led to rapid growth in trade. Though Sri Lanka was able to increase its exports to India, it was not on par with India’s exports. This led to the balance of trade crisis for Sri Lanka.
  • The Comprehensive Economic Partnership Agreement (CEPA), which is yet to be concluded, aims to move FTA beyond goods – towards greater integration and increased incentives and interactions in the bilateral economic cooperation.
  • In recent years, there is an increasing trend of investment in India from Sri Lanka.
  • Also, India is currently the largest contributor to Sri Lanka’s tourism industry.

Cultural and educational cooperation:

  • The two countries have signed the Cultural Cooperation Agreement in 1977. This agreement is the basis for frequent Cultural Exchange Programmes.
  • The Indian Cultural Centre in Colombo is currently promoting awareness about Indian music, dance, Hindi and Yoga. The cultural troupes from both nations exchange annual visits.
  • In 2014, both the nations’ governments celebrated the 150th anniversary of the Anagarika Dharmapala, the Sri Lankan (Sinhalese) revivalist and writer.
  • The India-Sri Lanka Foundation, established in 1998, is an intergovernmental initiative that aims to improve the scientific, technical, educational and cultural cooperation through people-to-people interactions.
  • Education is also one of the key areas of cooperation wherein India offers scholarships to the deserving Sri Lankan students.
  • Also, under the Indian Technical and Economic Cooperation Scheme and the Colombo Plan, India ensures cooperation in human resource development.
  • In 2015, the Indian government had launched the e-Tourist Visa (eTV) scheme for the Sri Lankan tourists to enhance people to people interactions. Later, the visa fee for the eTV was reduced.

Defence and Security cooperation:

  • Both nations have a long history of security cooperation. In the last few years, the two sides are increasing their military ties.
  • The bilateral army exercise, Mitra Shakti and Naval exercise, SLINEX is being conducted annually.
  • Defence training is also provided by India to the Sri Lankan forces.
  • India, Sri Lanka and the Maldives have signed trilateral maritime security cooperation agreement to enhance surveillance, anti-piracy operations and reducing pollution in the Indian Ocean Region.
  • In April 2019, India and Sri Lanka signed the agreement to counter drug and human trafficking.

Indian Diaspora:

  • The People from Indian Origin (PIOs) consisting of Sindhis, Borahs, Gujaratis, Memons, Parsis, Malayalis and Telugu speaking persons have settled in Sri Lanka. Majority of them settled only after the partition and are currently engaged in the numerous business ventures.
  • Though they are quantitatively less than those of Indian Origin Tamils (IOTs), they are economically well developed.
  • Each of these communities in Sri Lanka has individual organisations that organise festivals and cultural events.
  • The IOTs are mostly dependent on tea or rubber plantations in Central, Uva and Sabaragamuwa provinces for their livelihood in the last decade. Currently, this community’s youth is migrating to Colombo to search for employment. Many in this community are involved in business endeavours.
  • As per the 2011 government census, the population of the IoT community is approximately 1.6 million.

What are the challenges faced during the bilateral relationship?


  • China, in recent years, has invested billions of dollars as loans to Sri Lanka for infrastructure projects to increase its presence in the region.
  • It also supplied arms and developmental loans to Sri Lanka.
  • This is seen as a threat to the geostrategic interests of India.
  • Sri Lanka had also handed down the strategic Hambantota port for 99-years lease, as a part of its String of Pearls strategy to counter India.

India’s efforts to counter China:

  • Regardless of this trend, the bilateral ties between India and Sri Lanka have improved. To address India’s concerns with regards to the Hambantota port, the Sri Lankan government had ensured that China’s operations at the port are confined to the commercial operations and not for military purposes.
  • The two nations have signed the civil nuclear cooperation agreement. This is Sri Lanka’s first nuclear partnership with any country in the world.
  • India is also investing in Sri Lanka’s infrastructure projects in the Northern and Southern provinces to increase its presence in the region.
  • India, in collaboration with Japan and Sri Lanka, has agreed to develop the Port of Colombo to increase the port’s container volume and enhance marine transportation in and around South Asia.

Fishermen problem:

  • Due to the proximity of the territorial waters of India and Sri Lanka, especially in the Palk Strait and the Gulf of Mannar, incidents of illegal fishing are common.
  • The India government, in response to the financial crisis of the 1960s, had taken steps to stimulate the economy through seafood exports.
  • Thus, the government provided the fishermen with subsidised trawlers. This led to excessive fishing and destruction of the sea floor’s ecosystem. This has quickly depleted the fish supplies. By the late 1970s, the India fishermen needed new waters to fish. This led to them undertake illegal fishing in the Sri Lankan waters at the time of Sri Lankan Civil War.
  • After the Civil War, the Sri Lankan fishermen had weaker fishing boats. This led to the Sri Lankan Navy’s stringent response of ceasing the trawlers and arresting the illegal Indian fishermen.
  • The Indian fishermen had a greater advantage over their Sri Lankan counterparts. They had free reign in the Bay of Bengal, Palk Bay and the Gulf of Mannar until 1974 and 1976 when the treaty was signed to demarcate the International Maritime Boundary Line (IMBL).
  • This did little to address this issue.
  • Both the countries’ governments have taken various measures to solve this issue in a humane manner.
  • The nations have agreed to set up a Joint Working Group (JWG) on Fisheries between the Ministry of Agriculture and Farmers Welfare of India and Ministry of Fisheries and Aquatic Resource Development of Sri Lanka as a mechanism to deal with this issue.

Katchativu Island:

  • The “Katchativu Island Pact” was signed between the two nations, leading to India ceding the uninhabited Katchativu island to Sri Lanka on the conditional basis in 1974.
  • This island was later declared as the sacred island by the Sri Lankan government due to the presence of the Catholic shrine.
  • Though the Union government of India recognises Sri Lanka’s sovereignty over this island, the Tamil Nadu State government still claim that it is a part of the Indian territory and that the Tamil Fishermen have traditionally used it for the fishing purposes and thus, it belongs to India.

What can be the way forward?

  • India must prioritize in the committed developmental projects in Sri Lanka to gain popular support from the island nation. This would improve diplomatic ties and address India’s strategic interests.
  • Joint Working Group on Fisheries must hasten the process of addressing the issue of illegal fishing.
  • The Indian government must make use of the coast guards and the Navy to curb the Indian fishermen from crossing the IMBL.
  • Other economic opportunities must be provided to the fishermen so that they are not tempted to illegally cross the maritime boundary.
  • Allowing economic development of Sri Lanka and ensuring an improved balance of trade for the country can assure long-term diplomatic ties.
  • The people-to-people contact must be improved between the two nations so that there are synergy and stability in the region.
  • Mutual recognition of each other’s issues and interests can allow for an improved diplomatic relations between the two nations.


India, being a prominent Asian nation with vital national interests in South Asia, is responsible to ensure peace and stability at the nearby regions. Therefore, it must take steps to promote the economic development of the economically weaker neighbouring nations. Sri Lanka’s support is vital for India’s aspiration to create power balance with China and become a permanent member of the UNSC. Therefore, India must take steps to recognise the concerns of Sri Lanka and address them in a mutually beneficial manner.

Test yourself:

Critically analyse the geostrategic significance of Sri Lanka and the steps that can be taken to improve the ties with the island nation.

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