Policy synergy needed to boost SL-India growth: Sitharaman

• Indian Finance and Corporate Affairs Minister says private sectors and Govts. of both countries should focus on specific policy goals 
• Optimistic of stronger relations and investment opportunities based on Budget proposals 
• Says SL focus on self-reliance does not deter from stronger trade  
• India’s COVID-19 vaccine focus to help meet global demand

Sri Lankan and Indian Governments as well as their respective private sectors should present specific policy changes to improve bilateral trade, which could also be assisted by Budget 2021 proposals for improved investment and manufacturing opportunities between the two countries, India Finance and Corporate Affairs Minister Nirmala Sitharaman said yesterday.   

Minister Sitharaman, delivering the keynote address at the Sri Lanka Economic Summit ‘Roadmap for Takeoff: Driving a People-Centric Economic Revival’ organised by the Ceylon Chamber of Commerce, spoke of the warm relations enjoyed by the two nations. She also pointed out that the two countries had an estimated $ 3.5 billion in grants, projects and swaps, which could be further enhanced by working on aligning trade policies as well.  

“Both the Indian and Sri Lankan private sector should engage with both Governments to identify and clearly place before them policy or other regulatory interventions with which facilitation happens, so businesses can run with policy certainty. I underline the point that policy, either of taxation or any other policy, together with regulatory policy, should be consistent. I would think that both Governments and private sectors should engage to enable investor-friendly policies to be brought on the table,” she said. 

Comparing the economic policies of both countries, the Minister drew parallels between Sri Lanka’s emphasis on self-reliance and import substitution efforts and Prime Minister Narendra Modi’s India-focused manufacturing drive. She insisted that this would create more opportunities for trade within South Asia and argued that it made perfect sense given the challenges posed by COVID-19. 

“Like India, Sri Lanka is talking about a self-reliant Sri Lanka. I think it is more than coincidental that both countries are emphasizing on its peoples strengths, which is the core of building economic relationships. When you are talking about self-reliance it is not about saying you are looking inwards, it is not to say we are closed to the world. 

“On the contrary, it is to say each of us will engage with the world based on our strengths, based on our priorities and based on how the people of this country matter. It is complementary that there can be synergy built by us and this will only help us consolidate our relationship,” she added.  

Sitharaman pointed out that the Budget delivered in November spoke of sustained economic recovery, which she agreed was very important to Sri Lanka. The Minister likened Sri Lanka’s policies to what has been advocated by Indian Prime Minister Modi, who has also sought to provide a framework to provide immediate relief and subsequently a sustained growth path. 

“I’m glad to say after the lockdown was lifted, gradually there has been a revival and rating agencies have had to go back to their drawing boards to say that surprisingly the Indian economy’s growth is better than expected. India has proved itself during this pandemic, proved it can produce PPE, ventilators, oxygen and made sure its commitment to global healthcare is kept up. 

“Today India is the world’s second largest exporter of these items. India has also said it will support the development of a vaccine and structure it in such a way that not only will its own requirements be met, but it will support global demand,” stated Sitharaman.