WION Summit| 'India can offer zero-tariff access': Sri Lanka industry leaders call to rethink India–Sri Lanka trade ties

At WION Global Innovation and Leadership Summit in Colombo, on Saturday, Sri Lankan business leaders made a strong case for rethinking trade dynamics with India, urging deeper economic integration and more ambitious policy moves. Santosh Menon, the President of the Lanka India Business Association, said India could consider “a non-reciprocal zero-tariff arrangement for all Sri Lankan exports to gain access to India”. He noted that while India’s first free trade agreement was with Sri Lanka in 2000, there remains “an opportunity for a significantly improved dynamic in India–Sri Lanka trade”.

Menon pointed to stark imbalances to underline the untapped potential. “Indians are investing almost $30 billion every year around the world, yet only about $1 billion has come into Sri Lanka,” he said. “There are around 30 million Indian tourists travelling globally, but only about 452,000 visit Sri Lanka. All of these figures represent a huge opportunity.” He added: “Why is trade not benefiting both countries in a significant way? There is a huge opportunity for India, as the larger partner, to do something significant to change the narrative.”

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Ports, minerals and agriculture identified as key sectors

Nimal S Cooke, Executive Director of the Sri Lanka's Capital Maharaja Group, outlined three priority areas for collaboration: minerals, ports and agriculture. “The first and most important right now is the mineral resources in this country, for which India has a lot of technology and markets which we do not have,” he said. On infrastructure, he highlighted the potential of Trincomalee Harbour, particularly Sampur, noting it ‘has not been developed at all’ and that India can do a lot with that kind of Sri Lankan port.

Cooke also pointed to agricultural innovation, especially India’s development of nano fertiliser. “We have recently seen great innovation… which has shocked the world. As far as I know, there is no other nano fertiliser producer. We have a need for that; we can reduce our carbon footprint, and India can supply it,” he said. He further stressed Sri Lanka’s renewable energy potential, estimating “over a hundred thousand megawatts capacity in solar and wind”, adding that integration with India could enable conversion into green hydrogen through interconnectivity.

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Market access and MSME growth concerns

Tania Abeysundara, Chairperson of the Sri Lanka United Business Alliance, focused on trade barriers affecting smaller businesses. “Our total exports are $5 billion, and the Indian economy is mammoth compared to ours,” she said. “The garment industry is permitted to export only 800 million pieces.” She argued that a fully tariff-free, duty-free framework would be “a gesture of respect and genuine appreciation” and would significantly benefit small and medium enterprises.