Sri Lanka needs to connect with India to benefit from its industrial success: President Wickremesinghe

The cash-strapped country has introduced a set of hard reforms to address its economic woes.

Sri Lankan President Ranil Wickremesinghe. File | Photo Credit: AP

President Ranil Wickremesinghe on Wednesday said Sri Lanka needs to connect with neighbouring India to reap the benefits of its massive industrial development.

“Our neighbour India is going through a phase of massive industrial development. Tamil Nadu, Telangana and Andhra Pradesh are experiencing it. We must also join in,” said Mr. Wickremesinghe in his address at the Industry 2024 event in Colombo.

The president said he was hopeful of discussing with External Affairs Minister Dr. S. Jaishankar, who is due to arrive in Colombo on Thursday, about the follow-up on his interaction with Prime Minister Narendra Modi during his visit to India.

“Usage of solar and wind powers and to obtain liquid hydrogen are areas where we hope to work in collaboration with India," Mr. Wickremesinghe, also the finance minister, said, adding that Adani projects in Sri Lanka have pioneered these efforts.

Sri Lanka in the second quarter of 2022 had declared bankruptcy announcing the island’s first ever sovereign default.

Negotiations with the International Monetary Fund for a bailout began almost immediately and the first tranche of the $2.9 billion facility was released in March 2023.

The cash-strapped country has introduced a set of hard reforms to address its economic woes.

Despite the outstanding issue of debt restructuring, three tranches worth $1 billion of the $2.9 billion bail-out have been materialised subject to reforms.

Mr. Wickremesinghe said that by ongoing debt restructuring negotiations, the government was hoping to get time until 2042 to repay.

He said it was important for Sri Lanka to convert into becoming an export-oriented economy from the current import-oriented one.

“Since we are an import-oriented economy, we have to find money to import. To become an export-oriented economy, we have to be competitive with our industries to become a production economy,” the president said.

The IMF while commending Sri Lanka’s recovery efforts said the island nation's economy is far from being safe unless persisted with hard reforms needed.