India and Sri Lanka: A Changing Relationship
Sri Lanka has been one of India’s assertive neighbours. In the past the island state’s desire to assert its identity in international relations and its cultivated threat perception marred India-Sri Lanka relations. As a matter of fact the bilateral relationship weathered many potentially destabilizing storms and even touched the rock bottom in the mid-1980s but never did they reach a point of saturation or complete disruption or breakdown. That both the countries have developed adequate strength to withstand the stresses and strains is a notable feature of their bilateral relations. However, the entire gamut of their relations spreading over five decades cannot be viewed in a single framework. There have been shifts and changes in the pattern of relationship marked by mutual differences, irritants, co-operation and friendship. In this framework there has been simultaneity of divergence and convergence of views and perceived common interests between the two countries.
The purpose of the paper is to analyse the trajectories India-Sri Lanka relations have followed in the post-independence period. Based on the nature of relations and the issues dominating the bilateral agenda, the whole history of relations can be divided into four distinct phases—Decades of differences (1947-63), Resolving the disputes (1964-82), Troubled years (1983-90) and Restoring friendship (since 1991). Each of these phases is critically examined against the backdrop of factors determining India-Sri Lanka relations.
Determinants
There are five important factors that have determined the relationship. First, the geo-strategic configuration of both the countries has been the most compulsive factor in their relations. India is Sri Lanka’s closest neighbour, separated by a narrow stretch of waters in the Palk Strait covering about 20 miles. The implication of such a close proximity is that developments in each country have affected the other. Their bilateral relations have been influenced accordingly. The geo-strategic factor is significant in a different way also. Sri Lanka is located in what Prime Minister D.S. Senanayake called “the strategic highway”. Its centrality in the Indian Ocean has had strategic advantages and disadvantages. While the island’s location increased its vulnerability mostly during the cold war period marked by the militarization of the Indian Ocean, it has also been an asset from the standpoint of Sri Lanka’s foreign and security policy. Buttressed by a strategically important natural harbour in Trincomalee in the Eastern province, Sri Lanka had used its location to neutralise India’s position by cultivating extra-regional powers and even expressing its desire to give base facilities especially to the United States in the 1980s. India is always worried about the harbour’s status; its occupation by any external power is considered as a threat to its security. It must be stated that much of the strategic divergence in the 1980s arose out of the Sri Lankan government’s conscious decision to use its strategic location against the Indian interests.
Second, asymmetry of power between India and Sri Lanka is also a factor in their relations. India is over 50 times more than Sri Lanka in terms of area and population. Unlike India Sri Lank has a very small economic and technological base. Tea and tourism industries form a mainstay of the Sri Lankan economy. The country’s military strength is inadequate even to protect its national security. The asymmetrical power factor made the Sinhalese ruling elite deeply suspicious of India in the past. They looked upon India as, in the words of Ivor Jennings, “a mountain that might, at any time, send down destructive avalanches”. J.R. Jayewardene, former President, said in 1954 that “History has shown that adventures and men with imperialistic ideas may at any moment gain control of the reins of government in a state, and if that happens in India, the smaller nations that are her neighbours would have to seek protection not from external aggression but from Indian aggression”.
Third, Sri Lanka’s historical antecedents formed a factor in its relations with India. The island’s history is integrated with that of India, which played a significant role in shaping the course of events in the past. India’s strong influence or ‘Indian-ness’ is quite evident in the Sri Lankan society, as the roots of most of its population lay in India. The Sinhalese went from the Indo-Gangetic plain in the ancient period and the Sri Lankan Tamils migrated from South India. Buddhism was introduced from India during the rule of King Ashoka. The Sinhalese language belongs to the Indo-Aryan language family. As a result, Sri Lanka has always felt the need to assert its separate identity in the foreign policy arena. In this context, the memories of frequent Tamil invasions from Tamil Nadu and destruction of the Sinhalese Buddhist civilisation and the cross-boundary ethnic linkages between the Tamils across the Palk Strait have created a fear complex in the minds of the majority Sinhalese. In the past, they considered themselves as a minority in the South Asian regional context despite the fact that they formed a numerical majority in the island. The fear and minority complex of the Sinhalese reflected in the country’s foreign policy and relations with India.
Fourth, the internal political forces in India have influenced the tenor of relations. Given its strong ethnic linkages and geographical proximity with the island, Tamil Nadu has always showed an interest in India-Sri Lanka relations. Successive governments in Delhi could not ignore the views and sentiments of Tamil Nadu because of its being a politically sensitive and articulate state. In succumbing to the Tamil Nadu pressure, the national political parties have had their electoral interest and federal cohesion in mind. It must be noted that while responding to Tamil Nadu’s pressure, the Indian government has never allowed the state’s opinions to shape and determine the nature of its response. Three incidents can be quoted here. India signed the 1964 agreement on repatriation of the stateless Indian Tamils totally against the wishes of Tamil Nadu. Similarly, the 1974 agreement on Kachchativu was contrary to the dominant wishes of the state. In the mid-1980s, while responding to Tamil Nadu’s demand for a direct Indian role in the conflict, the Central government rejected the state’s pressure to undertake a military intervention with the objective of creating a separate Tamil eelam. It shows the limitations of Tamil Nadu in influencing India-Sri Lanka relations. Yet, the state remains an important factor in the bilateral context.
Finally, understanding at the level of political leadership and regime has been an important factor in India-Sri Lanka relations. Evidently the Congress regime in India and the Sri Lanka Freedom Party (SLFP) government in Sri Lanka have always enjoyed good relations. On the contrary, the United National Party (UNP) leaders did not enjoy a good rapport with the Congress leaders, but they enjoyed mutual understanding with the non-Congress leaders. Thus, the relations remained cordial when the Congress and the SLFP were in power in India and Sri Lanka respectively. Both the countries faced difficulties and irritants under the UNP and Congress regimes. At the same time, the relationship was cordial under the UNP government headed by President J.R. Jayewardene and Janata Party government led by Prime Minister Moraji Desai. It must be noted that though the ‘personality factor’ played a role in determining the pattern of bilateral relations, it did not work to change the Sri Lankan leaders’ rigid position on their country’s problems with India. Instead the Indian leaders became more amenable to the Sri Lankan demand on the issues such as statelessness of the Indian Tamils and the Kachchativu dispute. Importantly, at least since 1994, the personality factor has lost its importance in the bilateral relationship because both the UNP and the SLFP leaders follow a pragmatic policy of cultivating India irrespective of the party in power in India.
Decades of Differences (1948-63)
Three issues dominated the bilateral relations in the first phase. The ticklish issue was related to the statelessness of Indian Tamils who went to the island during the British colonial period to work on the plantations. The future political status of the Indian Tamils had loomed large as an issue in the politics of Sri Lanka even during the colonial period. However, it attained highly emotive dimensions only since 1948 when the Sinhalese ruling elite undertook measures to progressively whittle down the basic political rights of the Indian Tamils. Perceiving the Indian Tamil votes as a major threat to the electoral prospects of the UNP, the Sri Lankan government under the UNP Prime Minister, D.S. Senanayake, enacted Citizenship Acts of 1948 and 1949. They were made rigid and restrictive primarily to deny citizenship to all those who were not indisputably indigenous. The majority of the Indian Tamils found it difficult to comply with the provisions of the legislation, and thus became stateless.
Subsequently, Sri Lanka took the stand that all those persons who did not qualify for the island’s citizenship were to be repatriated to India. India however maintained that the Indian Tamils were no longer Indian nationals, but the residents of Sri Lanka who ought to be Sri Lankan citizens owing to their long stay in the island and contribution to the economic buoyancy of the country. It however expressed its willingness to absorb as its nationals only those persons who satisfied the citizenship provisions of the Indian Constitution
In this atmosphere of disagreement both India and Sri Lanka conducted bilateral negotiations in the 1950s to arrive at a working compromise on the status and rights of the Indian Tamils. Following the official talks in January 1954, Prime Minister Nehru and Premier John Kotelawala signed an agreement which inter alia stated that Sri Lanka agreed for the expeditious registration of stateless persons as its citizens under the Indian and Pakistani Residents’ (Citizenship) Act of 1949. Those Indian Tamils who were not registered as Sri Lankan citizens would be allowed, if they so desired, to register themselves as Indian citizens in accordance with the provisions of Article 8 of the Indian Constitution. The Pact, however, was not implemented scrupulously for several reasons, some of which arose out of the conflicting interpretations of its provisions. Under these circumstances, another bilateral meeting was held in New Delhi in October 1954 to resolve the difference. Some progress was made in this regard, but in actuality very little was achieved.
The dispute over Kachchativu, a tiny barren island in the Palk Strait, formed another source of bilateral discord. All historical evidence shows that the island formed a part of the Zamindari of Raja of Ramnad in Tamil Nadu. At the same time, Sri Lanka did not have sufficient evidence to show that the island belonged to it. However the Sri Lankan government made a claim on the ground that its ownership of the island was tacitly accepted by the British Indian government. While disagreeing with Sri Lanka, successive Indian leaders showed apathy and indifference towards the territorial dispute. Nehru and his successors underplayed the dispute in the interest of bilateral relations. This was evident from their various statements. Nehru virtually toed the Sri Lankan line of argument when he said that the Zamindari rights of the Raja of Ramnad did not confer sovereignty over the Kachchativu island. He showed his ignorance and casual approach to the problem when he stated that he was not sure about the location of the disputed island. He appeared to be over-cautious about Sri Lanka's sensitivity when he maintained that there was no "national prestige" involved in the issue. Similarly, fearing an adverse impact on bilateral relations, Indira Gandhi was even reluctant to take a pro-India position on Kachchativu which, in her opinion, was a "sheer rock with no strategic significance".However the dispute remained unresolved until 1974.
The third bilateral issue during the first phase of relations was related to divergent security perceptions and policies of both the countries. The crux of the matter was that successive Sri Lankan leaders had perceived India to be a potential threat to the island’s security. On this ground, they justified the 1947 Sri Lanka-UK defence agreement. India did not contribute in any way to Sri Lanka’s insecurity. As such, India had been deliberately made out to be a potential source of threat by successive ruling elite because of their strong desire to assert Sri Lanka’s identity and achieve a status for themselves vis-à-vis the Indian leaders. Prime Minister Nehru tried to allay the unjustified fears of Sri Lanka by assuring the UNP leaders of India’s goodwill and peaceful intentions. The fact that they were not convinced of India’s assurance and remained baselessly suspicious of its intentions showed Colombo’s extra-strategic considerations in pursuing a kind of defence policy that Senanayake and Kotelawala preferred. The policy demonstrated their desire to counterpoise India’s pre-eminence through an adroit strategy of military co-operation by using the country’s locational advantage in the Indian Ocean. The 1947 defence agreement with Britain was an outcome of this hidden agenda of the UNP government’s foreign policy; it could also be seen as a small country’s attempt to assert its independence and identity against a big neighbour, India.
India did not criticise Sri Lanka’s defence policy. Any adverse reaction would have lent credence to Sri Lanka’s threat perception and justified its policy action to counter India. However, the SLFP government during 1956-65 was sensitive towards India’s strategic concerns. India was particularly happy about Prime Minister S.W.R.D. Bandaranaike’s decision in 1956 to renegotiate on the British air and naval bases in Sri Lanka. Although this step sufficiently represented the SLFP government’s demonstration of its friendship with India and Bandaranaike’s closer identification with Nehru, what intrigued, not as much India’s foreign policy establishment as the unofficial quarters, was the future legal status of the 1947 Sri Lanka-UK defence agreement, which was not abrogated. This means that it can be validated at any time if both the countries so desire.
Resolving the Disputes (1964-82)
The second phase of India-Sri Lanka relations was noteworthy for the resolution of bilateral problems. Solutions to two contending problems—statelessness of the Indian Tamils and Kachchativu—were found in 1964 and 1974 when the Congress Party and the SLFP were in power in India and Sri Lanka respectively. The Sirimavo-Shastri Pact of 1964 began the process of resolving the stateless question. The Pact, the first of its kind to repatriate the Overseas Indians, stated that out of 9.75 lakh stateless persons in the island, Sri Lanka would grant citizenship to 3 lakh (along with their natural increase), while India agreed to accept repatriation to India of 5.25 lakh people (together with their natural increase) after granting its citizenship to them. The future status of the remaining 1.5 lakh stateless persons, it was agreed, was to be the subject of a separate agreement between the two governments. The Agreement also laid down that both the processes of granting Sri Lankan citizenship and the repatriation to India would have to be completed in 15 years (the duration was extended to 17 years in 1973) and would have to be as evenly phased as possible.
As regards the residue stateless people (numbering 1.5 lakh), India and Sri Lanka agreed to share them in equal numbers under the Agreement of 1974. The Agreement, which was to be implemented in two years, would begin its operation only after the complete implementation of the 1964 Pact. Therefore, by concluding two agreements for the Indian Tamils’ repatriation, India abandoned its insistence that the stateless people were Sri Lanka’s responsibility. Rather, it was the joint responsibility of both the governments. Such a shift in India’s stance was largely made because of its intention to develop irritant-free good neighbourly relations with Sri Lanka, which, in turn, affected the interests of the Indian Tamils.
In 1974 India and Sri Lanka resolved the Kachchativu dispute. In an extraordinary move to cultivate and befriend the Sri Lankan government, India had easily acceded to Sri Lanka’s claim over the Kachchativu island under the maritime agreement signed on 26 June 1974. This was one of the very few instances of India surrendering a small portion of its territory over which it enjoyed a rightful claim of ownership by virtue of the historical evidence that the island formed part of the Ramanathapuram Samasthanam. India underrated the strategic value of Kachchativu. Today its importance has increased considerably in view of the expanding maritime activities of the people of coastal Ramnad and the steady rise in the commercial value of marine products, especially prawns. It was unfortunate that the Indian leadership looked at the Kachchativu dispute entirely in a territorial context and ignored the future commercial importance of the Palk Bay region. As such, it did not foresee the problems which Indian fishermen are facing today.
India’s ineptitude handling of the dispute can be gauged from the most ambiguous way in which Article 5 of the Agreement was framed and understood. It said that "...Indian fishermen and pilgrims will enjoy access to visit Kachchativu as hitherto, and will not be required by Sri Lanka to obtain travel documents or visas for these purposes". While India interpreted the Article in a manner to include the traditional fishing rights of the fishermen around Kachchativu, Sri Lanka denied to have conferred such rights. Its rather fallacious argument was that the fishermen merely had the right to dry their fishing nets on the island. The point here is that why did not India seek a clear and well-meaning provision for the Indian fishermen's rights, instead of the ambiguous one which contained in the agreement? Was the Indian foreign policy establishment so callous that it left everything to the decision of Sri Lanka?
The 1976 maritime Agreement between India and Sri Lanka had removed the ambiguity at the official level when it stated that "the fishing vessels and fishermen of one country shall not engage in fishing in the waters of the other". But, for the fishermen of Ramnad such official decisions and proclamations of withdrawing their traditional fishing rights are arbitrary and, therefore, hardly acceptable. Lured by a heavy stock of demersal fish around Kachchativu, they knowingly or unknowingly cross the Indian maritime boundary to only get shot or captured by the Sri Lankan Navy. Thus, the Kachchativu agreement resolved the territorial dispute but introduced a new irritant in Indo-Sri Lanka relations.
Troubled years (1983-90)
The July 1983 ethnic violence in Sri Lanka and the subsequent civil war between the Sri Lankan army and the LTTE have made a decisive impact on the bilateral relations. India’s expression of concern over the killing of innocent civilians and its strong desire to protect the interest of Sri Lankan Tamils had created a strong sense of fear in the minds of the Sri Lankan government. The bogy of Indian intervention to create a separate eelam drove the Sri Lankan leadership to undertake a global search for security in 1983-84. What annoyed India more was Sri Lanka's strategic gestures to the West against India's security sensitivities. In desperation to win the US support the Jayewardene administration allegedly extended refuelling and recreation facilities to visiting US naval ships. It sought to make itself closer to the Western strategic interests by granting a contract for leasing of oil storage tanks in the strategic harbour of Trincomalee to a Singapore-based US company. The contract was subsequently revoked when India exposed the manipulation in selecting the tender. Furthermore, Sri Lanka entered into an agreement with the US in December 1983 to set up a powerful Voice of America (VOA) station in the island. It was expected to be the largest radio station with a powerful transmission facility established outside the US. India's apprehension was that the VOA could be used for intelligence purpose for the US Navy in the Indian Ocean. Not only these, Jayewardene tried to seek Britain's direct involvement in the conflict by giving a fresh lease of life to the 1947 defence agreement.
India's firm and categorical stand against external involvement in Sri Lanka frustrated, to a large extent, Colombo's frantic move to build up a strategic design and nexus in the region aimed at countervailing India. Though many countries (including the UK, the US, China and Pakistan) supplied arms or allowed military sales on a grant or commercial basis and extended training facilities to the Sri Lankan Army, none of them was prepared to become Sri Lanka's strategic partners in a real sense. The Western powers did not buy Sri Lanka's argument of India as a potential aggressor; their advice to the Jayewardene administration to seek India's help in resolving the ethnic conflict revealed their understanding of the ground reality. In this context, India's well-knit diplomatic campaign, clarifications and assurances worked towards convincing the West of its bona fides vis-à-vis Sri Lanka's security and discouraged countries like the US from accepting a strategic foothold in the island. Given their anti-India postures in foreign policy the Chinese and Pakistani military support to Sri Lanka was not surprising. Even they, like the US and the UK, demonstrated the limits of their military support when India undertook the infamous "Operation Eagle" in June 1987 to para-drop relief supplies to beleaguered Jaffna. They disapproved or condemned the Indian action and stepped up military supplies subsequently, but were not prepared to commit themselves for Sri Lanka's security.
Amidst the bilateral strategic differences India played a direct role in resolving the conflict since 1984. It adopted a two-pronged strategy of persuasion and coercion both against the Sri Lankan government and the Sri Lankan Tamil groups on different occasions. The objective behind such a strategy was to evolve a viable structure of political settlement through negotiations. Thus, if India supplied arms and extended training facilities to the militants, it was to increase the Sri Lankan Tamils’ bargaining power vis-à-vis the Sri Lankan government. The underlying assumption was that the militants’ empowerment would intensify their insurgency in the North-East. This coupled with the international pressure (especially from Sri Lanka's aid donors) would form a greater force to compel the Sri Lankan government not only to give up its military approach but also its tough position in negotiations with the Tamils. Many in the island did not understand the real purpose of India's strategy of empowerment and misinterpreted it as a retrograde step to divide Sri Lanka.
The sustained and prolonged negotiations under Indian mediation resulted in a bilateral peace accord, which Prime Minister Rajiv Gandhi and President Jayewardene signed on 29 July 1987. Importantly, by listing out wide-ranging obligations, the Agreement envisaged a participant role for India in the conflict. It undertook to guarantee the implementation of the Agreement by promising various steps--denial of base facilities to the militants in India and the Indian Navy's co-operation to prevent their activities--in the event of the Tamil militants' refusal to accept peace. In return, Sri Lanka agreed to address India’s security concerns. The letters exchanged between Prime Minister Rajiv Gandhi and President Jayewardene clearly spelt out the extent to which Sri Lanka addressed India's concerns over the presence of `foreign military and intelligence personnel', activities of `foreign broadcasting organisations', possible military use of Trincomalee port by external powers and contracting foreign firms to restore and operate the Trincomalee oil farm. While agreeing to consult India on the relevance and employment of external military and intelligence agencies and seeking its involvement in the restoration of oil tank farm, Sri Lanka undertook to review its agreements with foreign broadcasting organisations to ensure their use solely for public broadcasting and deny Trincomalee port for military use by "any country in a manner prejudicial to India's interests". These were simple commitments made by Sri Lanka
Thus, in the spirit of reciprocity and mutual accommodation, both India and Sri Lanka sought to remove each other's security concerns and threat perception. But the general impression was that India, a regional power, coerced a strife-torn small country to make extensive unilateral security concessions and offered its military help to the Sri Lankan Army with a view to restricting the island's external defence contacts. The arrangement was seen as a demonstration of India's desire for regional hegemony, subjecting Sri Lanka to be a country dependent on India for its security and survival. It was for this reason that some Sinhalese hard-liners even argued that by conceding to India's security demands, Sri Lanka compromised on its independence and sovereignty.
The noteworthy and serious commitment of India was to extend, as and when Sri Lanka requested, military assistance to implement the Agreement. Since it was primarily for this assistance that Jayewardene carved out an intervener for India, the request came immediately. India sent a contingent of peacekeeping force of about 8,000 men on 30 July 1987; their number rose to around one lakh in course of a full-scale military operation which began against the LTTE in mid-October 1987 in the wake of their refusal to accept the Agreement. In the process Sri Lanka itself legalised the trans-nationalization of the conflict and added a strong military dimension to it. The very fact that the need for the IPKF was envisaged in the Annexure to the Agreement indicated the impending problems and obstacles in its smooth implementation. In other words, at the time of concluding the Agreement, India and Sri Lanka seemed to have anticipated trouble from the LTTE. Once the Indian Army's involvement was sought and promptly obtained by the Sri Lankan President, the use of force to implement the Agreement was well within India's commitment. But the cost of intervention was heavy for the intervener as well as the LTTE. More than 1,200 soldiers (including a good number of officers) were killed and about 2,500 injured. India spent more than $ 180 million on the operation. The LTTE also suffered a heavy loss. Above all, several hundreds of civilians were dead or injured in the IPKF-LTTE war. Had the Indian foreign policy and defence establishments jointly tried to inject finesse in politico-military planning, much of the confusion regarding the IPKF's definite goal and strategy would have been avoided and the cost of its operation could have been minimised considerably.
Nevertheless, for India, the IPKF operation turned out to be a thankless job. Hated by the Sri Lankan Tamils and the Sinhalese alike, the IPKF was characterised as an army of occupation by the Premadasa regime. India protected Sri Lanka's national interest at its own heavy cost, but the Sinhalese refused to acknowledge and appreciate its sacrifice. Instead, the Premadasa government successfully used all unceremonious means to send the IPKF off the island; the most notorious way was arming of the LTTE against the IPKF and normalisation of relations with the LTTE leadership by holding peace talks during May 1989-June 1990. When India rightly insisted on the full implementation of the Agreement as a pre-requisite for the withdrawal of the IPKF, the same government that had invited India to underwrite the Agreement now asked India to abandon it. The IPKF's withdrawal in March 1990 without fulfilling the objectives laid down in the accord led to its de-legitimisation.
Restoring friendship (since 1991)
In the post-1990 period, India-Sri Lanka relations have registered an all-round improvement. The young generation of leaders who have succeeded the hawkish old leaders have been pragmatic in pursuing a policy towards India. The latter’s new policy of non-intervention in the ethnic conflict has also contributed to removing the cultivated fear complex of Sri Lanka. The leadership and the people in the island have changed their mindset and thinking about India; for the first time, India is considered as an asset rather than a threat to the island’s security.
India’s current stand on the ethnic conflict is characterised by its non-involvement and, at the same time, continued interest in the conflict. While refusing to play any direct role in the conflict, India is supportive of the peace process. Departing from its traditional stand against external involvement in South Asia, India has extended its wholehearted support for the Norwegian facilitation of the peace process. The US, the European Union and Japan also play a proactive role in the peace process. With the LTTE, India does not want to maintain any relations. The LTTE remains a banned terrorist organisation in India and its chief V. Prabhakaran is wanted for trial in the Rajiv Gandhi assassination case. Though the extradition of the LTTE leader is a matter in bilateral relations and often the Indian leaders have made statements to this effect, it is not a serious issue between the two countries. Despite the fact that the LTTE is ostracised, the Indian government seeks a political solution to the ethnic conflict through sustained negotiation. It favours a political solution within the framework of a united Sri Lanka that will satisfy the aspirations of all the communities. Such a solution should be a home-grown one, resulting from the peace process even if it is facilitated by the international community. In other words, the Indian stand is that the Sri Lankan people themselves should find an amicable solution instead of allowing the external powers to impose one on them. In order to democratise the Sri Lankan Tamils dominated North-east where the LTTE controls the entire political life, India insists on the principles of democracy and pluralism and respect for individual rights.
There is a growing defence co-operation between India and Sri Lanka. This was unthinkable some two decades ago. India supplies military hardware, shares intelligence information with the Sri Lankan navy to contain the LTTE’s activities in the Palk Strait and provide training to the Sri Lankan armed forces. Now, both the countries are engaged in discussions to conclude a defence agreement presumably to cover all the existing co-operation and intensify their military interactions.
On the economic front, India and Sri Lanka signed a free trade agreement in December 1998 which became operational from 15 December 2001. India has committed to provide immediate duty free on 102 items and 50 per cent duty concession is given on 400 items which would become duty free in three years. The bilateral trade has registered a significant expansion and increase in the last three years. It has reached $ 1 billion mark and Sri Lanka’s trade deficit is decreasing. Now, both the countries are engaged in a serious dialogue to conclude a comprehensive economic partnership agreement (CEPA). A Joint Study Group set up for this purpose has completed the work and its recommendations have been presented to the Prime Ministers of the two countries. It is said that the CEPA will cover services and investment; it will take the two countries to a “qualitatively new level of engagement by intensifying and deepening bilateral economic interaction, building on the advantages of close political and geographic proximity”.
In June 2002, India offered a credit line of $ 100 million to Sri Lanka. It was meant for purchasing capital goods, consumer services and food items from India. On exhaustion of the first instalment of $ 45 million, an agreement to release the second instalment of $ 30 million was concluded in October 2003. In October 2001 India gave Sri Lanka a loan of $ 20 million for its economic stabilisation. India also extended a special credit line of $ 31 million to purchase wheat. Importantly, in June 2002, the Indian Oil Corporation and the Ceylon Petroleum Corporation signed a MoU under which the former is allowed to engage in retail oil trade in the island as well as to manage and operate, on a long lease, the Trincomalee oil tanks. Both the countries have planned to start a ferry service between Colombo and Cochin. There has been significant increase in the travel services between the two countries.
The issue of Tamil Nadu fishermen (who often cross over to Sri Lankan waters) is a major concern for India. Frequent arrest of the Indian fishermen by Sri Lanka has not however affected the bilateral relations. In order to end this irritant problem, India has made a proposal for the introduction of a system of licensed fishing in Sri Lanka’s north-eastern waters. In view of the humanitarian dimension of the problem, India and Sri Lanka have agreed to deal with the fishermen issue in a “practical and compassionate way”.
Conclusion
In the last one decade, significant changes have taken place in India-Sri Lanka relations. The nature and pattern of relations are completely different. The comprehensive improvement in relations can be assessed both in qualitative and quantitative terms. It must be stated that the leadership in both the countries should be given the credit for taking the bilateral relations to such a new height. The ending of mutual misperception and the increase in mutual understanding have brought about this desired change. The new regional environment has also provided the right condition for the improvement of relations. Now, the main task of the leaders of both the countries is to maintain the same pattern of relations by providing a continuity in co-operation and strengthening their mutual understanding.