India and Sri Lanka lay the groundwork for closer economic ties | East Asia Forum
India and Sri Lanka lay the groundwork for closer economic ties East Asia Forum
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Sustainable Development Goals (SDGs) and Bilateral Connectivity: India-Sri Lanka Partnership
Authors: Ganeshan Wignaraja and Manjeet Kripalani, Gateway House
Introduction
Sri Lankan President Ranil Wickremesinghe’s visit to India on 21 July 2023 concluded with an ambitious agenda for bilateral connectivity. The visit was another step in the new partnership that India began with Sri Lanka in 2022, but forging closer economic ties will require fostering supply chains, a comprehensive free trade agreement, and greater central bank cooperation.
Economic Element of the Bilateral Relationship
The joint statement issued after the meeting clearly emphasized the economic element of the bilateral relationship. In the past, India’s security concerns over China’s role in Sri Lanka, disputes over fisheries, and the unresolved issue of ethnic reconciliation have held back bilateral economic cooperation. But India played a crucial ‘Neighbourhood First’ role with foreign aid of US$4 billion to Sri Lanka after the island economy defaulted on its foreign debt in April 2022 and slipped into an economic crisis.
Partnership Focus Areas
This time, it is not just a government-to-government plan. The partnership encourages investment from India’s private sector and joint ventures with Sri Lankan companies. Three areas — logistics, energy, and tourism — are the focus of this partnership. This includes improving regional logistics and the development of ports in Colombo, Trincomalee, and Kankesanthurai, ferry services between Indian and Sri Lankan ports, and greater air connectivity between both countries. These are business investments that also enable people-to-people movement.
Bilateral Energy Engagement
Bilateral energy engagement is significant. The most important projects include proposals to build an oil pipeline from India to Sri Lanka and to connect the two countries’ electricity grids. India already has oil pipelines and power links with Bangladesh and Nepal — providing a template that
SDGs, Targets, and Indicators in the Article
1. SDGs Addressed or Connected to the Issues Highlighted in the Article
- SDG 8: Decent Work and Economic Growth
- SDG 9: Industry, Innovation, and Infrastructure
- SDG 17: Partnerships for the Goals
2. Specific Targets Under Those SDGs Based on the Article’s Content
- SDG 8.1: Sustain per capita economic growth in accordance with national circumstances and, in particular, at least 7% gross domestic product growth per annum in the least developed countries.
- SDG 9.1: Develop quality, reliable, sustainable, and resilient infrastructure, including regional and transborder infrastructure, to support economic development and human well-being, with a focus on affordable and equitable access for all.
- SDG 17.16: Enhance the global partnership for sustainable development, complemented by multi-stakeholder partnerships that mobilize and share knowledge, expertise, technology, and financial resources.
3. Indicators Mentioned or Implied in the Article to Measure Progress towards the Identified Targets
- Gross Domestic Product (GDP) growth rate
- Investment from India’s private sector
- Number of joint ventures between Indian and Sri Lankan companies
- Improvement in regional logistics and development of ports
- Increase in air connectivity between India and Sri Lanka
- Construction of an oil pipeline from India to Sri Lanka
- Connection of the electricity grids of India and Sri Lanka
- Increased bilateral trade and foreign direct investment flows
- Reduction in trade costs and improvement in regional trade and transport-related infrastructure
- Digitization of trade processes and reduction in red tape
- Central bank cooperation and establishment of an early warning system for economic crises
- Expansion of the IMF Capacity Building program in South Asia
Table: SDGs, Targets, and Indicators
| SDGs | Targets | Indicators |
|---|---|---|
| SDG 8: Decent Work and Economic Growth | Target 8.1: Sustain per capita economic growth in accordance with national circumstances and, in particular, at least 7% gross domestic product growth per annum in the least developed countries. | Gross Domestic Product (GDP) growth rate |
| SDG 9: Industry, Innovation, and Infrastructure | Target 9.1: Develop quality, reliable, sustainable, and resilient infrastructure, including regional and transborder infrastructure, to support economic development and human well-being, with a focus on affordable and equitable access for all. | Investment from India’s private sector Number of joint ventures between Indian and Sri Lankan companies Improvement in regional logistics and development of ports Increase in air connectivity between India and Sri Lanka Construction of an oil pipeline from India to Sri Lanka Connection of the electricity grids of India and Sri Lanka |
| Target 9.2: Promote inclusive and sustainable industrialization and, by 2030, significantly raise industry’s share of employment and gross domestic product, in line with national circumstances, and double its share in least developed countries. | Increased bilateral trade and foreign direct investment flows Reduction in trade costs and improvement in regional trade and transport-related infrastructure Digitization of trade processes and reduction in red tape |
|
| SDG 17: Partnerships for the Goals | Target 17.16: Enhance the global partnership for sustainable development, complemented by multi-stakeholder partnerships that mobilize and share knowledge, expertise, technology, and financial resources. | Central bank cooperation and establishment of an early warning system for economic crises Expansion of the IMF Capacity Building program in South Asia |
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Source: eastasiaforum.org
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