Sri Lanka

1. Why Sri Lanka matters to India

Sri Lanka occupies a pivotal position off India’s southern coast, near sea lanes linking the Strait of Malacca with the Arabian Sea and the Suez route. Developments around Colombo, Hambantota and Trincomalee consequently affect India’s maritime security, commercial connectivity and regional influence. Colombo is an important transshipment hub for Indian cargo, although India’s expanding port capacity may gradually alter this dependence.

Geography is reinforced by civilisational ties. Buddhism travelled from India to Sri Lanka, traditionally associated with Mahinda and Sanghamitta during Ashoka’s reign. Hindu pilgrimage, linguistic connections, education, tourism and migration sustain contemporary exchanges. Sri Lankan Tamils, concentrated particularly in the north and east, and Indian-origin Tamils, historically associated with plantation labour in the central highlands, are distinct communities with different historical experiences.

For India, Sri Lanka connects neighbourhood diplomacy with its wider Indian Ocean approach. Cooperation supports maritime domain awareness, humanitarian assistance, disaster relief and secure trade. For Sri Lanka, India offers a nearby market, emergency support and development opportunities. However, differences in size create sensitivities about dependence and interference. Effective diplomacy therefore requires partnership rather than an assumed entitlement to strategic compliance.

• Relevant frameworks include Neighbourhood First, SAGAR—Security and Growth for All in the Region—and regional cooperation through BIMSTEC and the Indian Ocean Rim Association.
• Tamil Nadu’s political concerns make Sri Lanka an important example of the interaction between domestic politics and foreign policy.

2. Ethnic reconciliation and the legacy of intervention

Post-independence citizenship and language policies deepened ethnic divisions in Sri Lanka. The Sinhala Only Act of 1956 became a major symbol of Tamil exclusion. Anti-Tamil violence, particularly the July 1983 pogrom, helped transform separatist mobilisation into a prolonged civil war. India initially became involved through refugee management, Tamil political pressures and engagement with militant organisations, before attempting a negotiated settlement.

The 1987 Indo–Sri Lanka Accord sought to preserve Sri Lanka’s unity while addressing Tamil political aspirations. The Indian Peace Keeping Force was deployed under the accord but subsequently fought the Liberation Tigers of Tamil Eelam. Its withdrawal in 1990 and the LTTE’s assassination of former Prime Minister Rajiv Gandhi in 1991 profoundly reshaped Indian policy. The war ended in May 2009 with the military defeat of the LTTE, but questions of accountability, missing persons, land restitution and reconciliation remained.

India supports a united, stable Sri Lanka alongside equality, justice, dignity and peace for Tamils. It has consistently advocated meaningful devolution and implementation of the Thirteenth Amendment. Provincial councils provide a constitutional framework, but politically sensitive powers, particularly police powers, remain contested. Devolution should not be confused with secession: the policy challenge is to accommodate diversity within Sri Lanka’s constitutional order.

At the UN Human Rights Council, India has had to balance concerns about minority rights and post-war accountability with sovereignty, bilateral cooperation and the risks of external polarisation. Housing, education and livelihood projects in affected regions provide a complementary, people-centred channel of engagement.

3. Economic recovery and connectivity

Sri Lanka’s 2022 crisis reflected interacting domestic and external weaknesses: fiscal imbalances, major tax cuts, depleted foreign-exchange reserves, debt vulnerabilities, the collapse of tourism during the pandemic and higher import costs. The abrupt restriction on chemical fertilisers also disrupted agriculture. Sri Lanka suspended servicing much of its external public debt in April 2022, while shortages of fuel, food and medicines triggered mass protests.

India’s approximately US$4 billion support helped finance essential imports and ease immediate liquidity pressures. India also provided financing assurances that supported the IMF programme and participated in the Official Creditor Committee, co-chaired with France and Japan. Emergency assistance strengthened goodwill, but durable recovery depends on Sri Lankan fiscal reform, debt restructuring, better governance and protection of vulnerable households.

The bilateral Free Trade Agreement has supported goods trade, although rules of origin, standards, non-tariff barriers and concerns about uneven gains remain important. Negotiations on a broader Economic and Technology Cooperation Agreement have faced domestic sensitivities in Sri Lanka, especially over services and employment. Proposed agreements must therefore be assessed through transparent evidence rather than assumptions that liberalisation automatically benefits all groups.

Connectivity cooperation spans ports, shipping, aviation, energy and digital payments. The Nagapattinam–Kankesanthurai passenger ferry was launched in 2023, while UPI services were launched in Sri Lanka in February 2024. Cooperation around the Trincomalee oil tank farm and discussions on power interconnection illustrate energy opportunities. Proposed grids, pipelines and land connectivity should be distinguished from completed infrastructure; feasibility, financing, ecology and local consent determine their viability.

4. Maritime security and strategic competition

Chinese infrastructure finance and port-related investments have expanded Beijing’s presence in Sri Lanka. Hambantota Port’s 99-year lease to a Chinese-led company in 2017 became a symbol of strategic anxiety. However, describing Sri Lanka’s entire debt crisis as a Chinese debt trap is analytically inadequate: international sovereign bonds, macroeconomic choices and external shocks were also significant. Commercial ownership or operation of a port does not automatically establish a foreign military base.

India nevertheless has legitimate concerns about submarine visits, intelligence collection and dual-use research vessels near sensitive waters. The arrival of the Chinese vessel Yuan Wang 5 at Hambantota in 2022 illustrated the tension between Sri Lanka’s sovereign decisions and India’s security expectations. Clear procedures for foreign vessel access and advance communication can reduce mistrust without requiring Sri Lanka to abandon all relations with China.

India and Sri Lanka cooperate through naval and coast guard exchanges, the SLINEX naval exercise, the Mitra Shakti army exercise and the Colombo Security Conclave. Their shared agenda includes terrorism, trafficking, cyber threats, maritime safety and disaster response. Sri Lanka also engages other partners, including Japan and the United States; its diplomacy is better understood as diversification and balancing than as a simple choice between India and China.

• India’s comparative advantages include proximity, rapid emergency response, cultural familiarity and civilian capacity-building.
• Strategic reassurance is most credible when projects are financially sustainable, transparent and responsive to Sri Lankan priorities.

5. Fisheries, political sensitivities and the way forward

The fisheries dispute centres on Indian vessels crossing the International Maritime Boundary Line, especially in the Palk Bay, and the ecological consequences of bottom trawling. Northern Sri Lankan Tamil fishers, whose livelihoods suffered during the civil war, object to competition and damage to seabed habitats. Arrests, vessel seizures and episodes involving force create recurring humanitarian and diplomatic tensions.

The 1974 maritime boundary agreement placed Katchatheevu on the Sri Lankan side; the 1976 arrangements further regulated maritime boundaries and fishing access. Access associated with pilgrimage or other provisions should not be treated as an unrestricted right to fish in Sri Lankan waters. Reopening territorial rhetoric does not by itself resolve depleted stocks, destructive gear or livelihood insecurity.

A durable settlement requires humane enforcement, prompt consular access, fisher-to-fisher dialogue and implementation of bilateral fisheries mechanisms. On the Indian side, alternatives to bottom trawling must include affordable finance, appropriate vessels, training, landing facilities and reliable markets. Deep-sea fishing cannot succeed merely through vessel subsidies. Joint ecological monitoring and protection of breeding habitats can frame conservation as a shared interest.

The broader relationship should combine predictable security consultation with timely development delivery. India should engage governments across Sri Lanka’s political spectrum, support reconciliation without appearing prescriptive, and avoid presenting every project as a contest with China. Mutual benefit, institutional continuity and respect for sovereignty offer a stronger foundation than crisis-driven generosity alone.

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