India boosts financial allocation for Sri Lankan grant projects by 50%
Daily FT: Responding to rapid changes in the economic landscape of Sri Lanka, Government of India (GOI) has increased the financial allocation by 50% for various grant projects being implemented across the length and breadth of the country.
Financial allocation has been increased for nine ongoing projects which are being executed under the India-Sri Lanka High Impact Community Development Project (HICDP) framework.
The overall financial commitment for these nine projects currently stands at close to Rs. 3 billion, after the increase. These projects cut across sectors ranging from education and health to agriculture, among others.
The India-Sri Lanka HICDP framework has been instrumental in fostering bilateral cooperation between the two nations. Since its inception in 2005, and with subsequent renewals, the framework has played a pivotal role in channeling support to various districts across Sri Lanka.
With over 60 grant projects already completed, covering all 25 districts of the country, and an additional 20 projects at various stages of implementation, the impact of this partnership is far-reaching. The GOI had previously increased the ceilings for individual projects and the overall financial capital outlay under this framework in January 2023, underscoring its unwavering commitment to the development of Sri Lanka.
GOI’s comprehensive development cooperation partnership portfolio in Sri Lanka is substantial, amounting to around $ 5 billion, with a generous $ 600 million designated for grants. These initiatives are designed to be demand-driven and people-centric, encompassing critical areas such as infrastructure development, housing, livelihood assistance, and more.
Among the noteworthy projects completed by GOI in Sri Lanka are the 1990 Emergency Ambulance Service, Railway Track rehabilitation, Integrated Water Plants, Indian Housing Project, and the Jaffna Cultural Centre.
OSL take:
Sri Lanka and India enjoy strong bilateral and trade ties spanning centuries and India is one of the main development partners of Sri Lanka. India has invested in many development projects in Sri Lanka covering key economic sectors in the country. Many Indian businesses have also expanded into Sri Lanka and have posted continuous growth and profits indicating that Sri Lanka is open for business. With India now committing funds for grant projects, there are new business opportunities opening up for local and foreign businesses. While Indian businesses could also explore the growing opportunities in Sri Lanka, they could also look at forming partnerships or joint ventures with local businesses to expand operations locally and internationally. Sri Lanka’s close proximity to India, the operational free trade agreement (FTA) between India and Sri Lanka are also encouraging signs for Indian businesses/investors to explore the expanding opportunities in Sri Lanka. Also, given Sri Lanka’s close ties with India, other foreign businesses/investors could look at setting up base in Sri Lanka to engage with India using the preferential treatment enjoyed by Sri Lanka when engaging with India.
| Article Code : | VBS/AT/20230914/Z_3 |