‘India Calling’: Sri Lanka businesses sees new opportunities, sharper challenges in India

Sri Lankan businesses are being urged to look beyond traditional India trade ties and position themselves for a more competitive, opportunity-rich market, at the inaugural ‘India Calling’ forum organised by the Lanka India Business Association (LIBA) spotlighted the shifts reshaping bilateral commerce and investment. Below are key learnings from the forum;

1. India should be treated as a platform for scale

The central message was that Sri Lankan businesses should not view India merely as another export destination. India can provide manufacturing capacity, customers, capital, distribution and access to the Middle East, Africa and other Global South markets.

JETRO proposed a model, where Sri Lanka supplies specialised components and intermediate products, with final manufacturing or assembly taking place in India.

Potential areas identified included:

n Electronic components, printed circuit boards and wire harnesses

n Automotive and industrial components

n Natural graphite, silica and other mineral-based inputs

n Rubber-based industrial products

n Medical-device components

n Renewable-energy and battery-related inputs

n Food processing and selected agricultural products

2. Entering India requires a focused local strategy

India cannot be approached as one uniform market; it operates more like several distinct markets with different consumer preferences, regulations, languages, distribution systems and price points.

The Maliban/Elephant House–Reliance examples showed that the strongest route is usually a strategic local partnership rather than a basic distribution agreement. Sri Lankan companies should bring a clear capability, such as a trusted brand, intellectual property, R&D, technology or specialised expertise while the Indian partner provides local knowledge, manufacturing and distribution.

Products may also require significant localisation. Even similar consumer products may need different formulations, packaging, positioning and pricing across Indian states. A company should therefore start with one state, customer segment or vertical and expand after validating the market.

3. Partnerships must be structured carefully

A recurring point was that partnerships should create mutual value rather than dependence. Before entering a joint venture, businesses should clearly define:

n What each party contributes

n Ownership and decision rights

n Protection against dilution

n Board and voting rights

n Intellectual-property ownership

n Exit and dispute-resolution mechanisms

The recommendation was to conduct proper partner due diligence and use strong joint-venture or shareholder agreements rather than being influenced only by the size or reputation of the Indian partner.

4. Sri Lanka’s main investment problem is uncertainty, not lack of interest

The panels indicated that Indian companies are interested in Sri Lanka, but policy inconsistency, approval delays, unclear governance, customs procedures and fragmented institutions prevent many proposed investments from reaching execution.

The strongest statement was that businesses can price identifiable risks, but they cannot price continued uncertainty. Transparency and consistent governance are therefore more important than promotional events or investment announcements.

5. Investments should be measured by economic capability created

Large investments should not be judged only by their headline value. The more relevant questions are whether they create:

n Skilled employment

n Technology and knowledge transfer

n Local suppliers and service providers

n Productivity improvements

n Foreign-exchange earnings

n Long-term operational capabilities

6. Supply-chain resilience and sovereignty are becoming commercial drivers

Geopolitics is increasingly influencing decisions around manufacturing, cloud infrastructure, AI, energy and critical technology. Businesses and governments are moving away from selecting suppliers purely on the lowest cost and are placing greater importance on trusted partners, shorter supply chains, resilience and reduced dependence on a single country.

This strengthens the case for positioning Sri Lanka as a trusted regional location for specialised manufacturing, digital infrastructure, cloud services, AI workloads and business continuity.

7. Sri Lanka must improve productivity and competitiveness

Sri Lanka’s problem is not only a shortage of talent, but also low productivity, limited exposure to competition and a tendency to protect existing industries rather than forcing them to improve.

India benefits from scale, infrastructure, networks and a high concentration of talent and capital. Sri Lanka cannot replicate that scale, but it can compete through narrow specialisation, speed, quality and export-oriented capabilities.

8. Startup ecosystems need coordination, not isolated program

India’s startup ecosystem was described as an organised network linking founders, universities, investors, corporates, Government programs, incubators and first customers.

Sri Lanka has talent and ambition, but the organisations supporting entrepreneurs frequently operate in silos. The lesson is to connect market access, mentorship, funding, technical support and customer introductions around selected sectors rather than creating more disconnected programs.

Conclusion

The opportunity is not simply to “sell products to India.” It is to identify a specialised Sri Lankan capability and combine it with India’s capital, customers, manufacturing capacity and distribution.

The businesses most likely to succeed will be those with a clearly differentiated capability, a strong local partner, properly protected IP and governance, and a focused market-entry strategy.

(The author is a Financial Analyst at Plus94, a corporate advisory and private equity firm, where she works on financial analysis, market research, deal evaluation and transaction structuring. She can be reached at [email protected])