Remarks by High Commissioner of India, H.E. Santosh Jha
at 45th National Conference of CA Sri Lanka
on 14 October 2024 

Mr. Heshana Kuruppu, President CA Sri Lanka

Chairman organizing committees of 45th National Conference 

Past Presidents

Members of the CA Sri Lanka

Friends, Ladies and Gentlemen

Good evening, Ayubowan, Namaskar, Vanakkam

I am truly delighted to have this opportunity to address the 45th National Conference of the Institute of Chartered Accountants of Sri Lanka. I am truly honored and privileged to have received this invitation. 

Friends,

It is a pleasure to be among high quality professionals, who see themselves as changemakers in Sri Lanka. I am told this Conference is the largest annual business gathering in the country. For you to invite the Indian High Commissioner to such a gathering tells me something. One, of course, is the natural interest that you have in India, being our closest neighbor. My guess is that it is perhaps also a reflection of a growing desire in Sri Lanka to look at India afresh – and to seek advantages from the Indian growth story. If so, this is a legitimate aspiration. We must work hand-in-hand and grow and prosper together. Like it or not, we are naturally intertwined and interlinked – by geography, history, tradition and by our future. We are irreplaceable, indispensable and inextricable as partners. Any attempt to drive a wedge can only be detrimental to our shared future and for our shared aspirations. It will be a negative not just for one side alone but to the other as well – and that too in equal measure. We must, therefore, transcend old mindsets and overcome past hesitations. We must actively work together for our shared goals, objectives and aspirations.

Friends, 

I have been asked to speak on global trends, India’s place in it, the opportunity for Sri Lanka in India’s growth, and on our bilateral potential as well. Obviously, this is a lot to cover in the short time available. But let me make an honest and sincere attempt. 

World has become a difficult place, it is moving and changing at an unprecedented pace. Just a few days ago, my External Affairs Minister Dr. Jaishankar described the major global trends in three words: (i) Rebalancing; (ii) Multipolarity; and (iii) Plurilateralism.

Rebalancing implies the shifting of the economic, political and strategic weight of the global order from the Atlantic to the Indo-Pacific. The Indo-Pacific is the center of activity today – it is the epicenter of global growth and dynamism. If one looks at the G20, the top 20 economies of the world, there are many more Indo-Pacific economies in the list than there were a few decades ago. Their economies have not only risen at a faster rate than the others, their rise is also likely to be more enduring and impactful. 

Let me digress a bit and add that within the G20, the Indian economy has been a star performer. It is the world’s fastest growing major economy. Its solid fundamentals will ensure that India’s high growth is likely to continue for decades to come. Just to elaborate, ten years ago, India was the 10th largest economy in the world; we are now the fifth largest; and we will soon be the third largest before the end of this decade. Many global experts predict that India could emerge as the second largest economy by 2050. Not surprisingly by 2047, when we celebrate 100 years of independence, we set ourselves a target to emerge as a developed nation. 

So, India is clearly emerging as a key player in this ongoing rebalancing. Our share of the global GDP growth, too, is rising exponentially. Sri Lanka, as our closest maritime neighbor, has an obvious opportunity in this context. To plug in to the regional growth engine that is India and to leverage it to rebuild its own growth and prosperity. 

The ongoing rebalancing has also led to a world where it is increasingly the G20, and not the G7, that matters, when it comes to global growth, maintaining global order and addressing global issues and challenges. In other words, there are today multiple centers of decision making, multiple growth engines and multiple paths of convergences. This confirms that we are moving towards a multipolar world increasingly and decisively. India and the Indian subcontinent are very much one of these multiple poles. 

The ongoing shifts in global power also implies that the traditional institutions that had managed the global order are increasingly inadequate to deal with them. This includes the UN, the WTO, the WHO and others. They are today completely out of sync with contemporary realities, unrepresentative in terms of emerging global power configurations, and unable to address global challenges. This was most ominously evident during the Covid pandemic, when the UN was mostly a bystander. Metaphorically speaking, their software is not only outdated but also in need of an urgent update. 

Ineffectual global institutions have given rise in turn to the phenomenon of plurilateralism. This refers to a group of countries taking recourse to mechanisms that serve their limited agenda and shared interests in an agreed theater. The QUAD, BRICS, BIMSTEC or IORA or the more recent Colombo Security Conclave are best examples. Sri Lanka is already a part of the BIMSTEC, IORA and Colombo Security Conclave. Recently, it has also announced its intention to seek membership of the BRICS. These enable Sri Lanka a role in designing and shaping regional structures and to leverage them to benefit from security and economic structures that are set up within these groupings. Obviously, India as a member of these groupings provide Sri Lanka with another vector for engagement with India. Another example of such plurilateral mechanisms, which is interesting from Sri Lanka’s perspective, is the IMEC – or the India-Middle East-Europe Economic Corridor. This initiative aims to connect India, Middle East, and Europe. A connectivity corridor between India and Sri Lanka, therefore, can open doors to Sri Lanka to connect with the rest of the world and to access markets and opportunities beyond India that are presently not leveraged.

Friends, 

Let me turn your attention now to the major disruptions and its impact on global trends. For ease of understanding, let me simplify them as the 3Cs - COVID, Conflicts, and Climate Change. While COVID was a wake-up call, the world has been witnessing repeated shocks – conflicts in Ukraine and Gaza, and of course, disruptive climate events and challenges. These disruptions have challenged global solidarity, underlined the need for coordination among the Global South and also reminded us once again the need for urgent reforms to the global order. 

But most of all, it has brought to the fore the need for reorganization of globalization as we know it. Indeed, the world is more interconnected and inter-penetrated than ever before. Globalization is here to stay but not in the way we knew it. The disruption as signified by the 3Cs coupled with uneven benefits of globalization and concentration of manufacturing in certain geographies, which is a direct consequence of globalization, has led to several countries seeking greater redistribution and diversification of manufacturing. It has also underlined the need for building more resilient, reliable and redundant supply chains.  

Here again lies an opportunity for India. Multinationals that are looking at diversifying their supply chains want to shift to regions and countries with open democratic systems, and those which operate on open and transparent market economic principles. India is a natural candidate here. Realizing this opportunity, India has undertaken bold economic reforms. It has sought to build a world-class infrastructure at unprecedented speed and scale in the last decade. It has made a massive strategic shift to renewable energy. It has extended massive financial incentives and improved the ease of doing business to attract foreign investors. It has continued to improve its processes and procedures to compete with peers and do better than them in bringing best practices, the most advanced technologies and ever greater foreign investments. And, of course, it has leveraged its massive talent pool and its large and growing markets.

As India attracts more foreign investors, there is a potential for Sri Lanka to attract business from those who are seeking to enter India. Sri Lanka can position itself as India plus one, in several areas - from services to manufacturing. It can leverage its location, and of course, its strong bilateral business and commercial links with India.

Another emerging global trend, and perhaps the most consequential one, is the growing salience of technology as a determinant of global power. In fact, the global competition today is most of all a competition in the realm of technology. The digital era is here to stay! And so also its emerging offshoots - Artificial Intelligence, Quantum Computing, Robotics, and other new technologies. India is both a player as well as an arena in this disruption. 

Its preeminence in the digital domain has led to this decade being termed as India’s Techade. From semiconductor manufacturing to space exploration, new age technologies, its large talent pool, growing defense capabilities, and rapid advancements in telecommunications – India is not just keeping up but is actively shaping the global technology landscape.  We are also working to prepare our young population to emerge as key players in the emerging global work place. We are expanding our educational infrastructure – we are building 2 colleges per day for the last 10 years. We are also preparing to impart new age skills to our youth to fill not just the skill gap in India but around the world. 

For India, technology, especially digital technology, is also a means to fulfill millions of aspirations. The Digital Public Infrastructure (DPI) we have built is the best in the world. It is playing a critical role in ensuring last-mile delivery of public services to the citizens. When even the strongest banking systems in the world faltered during the COVID pandemic, banks in India continued to operate uninterrupted. We were able to vaccinate 1.4 billion people at the same pace and speed, as the developed regions of the US and Europe. We have emerged as the global leader in fintech and in digital financial transactions. Whether it is payment systems such as the UPI or RuPay card, or digital public goods such as Digi Locker, or Digi Yatra, various digital platforms have become part of everyday life for the people of India.

As everything goes digital, a word of caution is due as well. Technology today is as intrusive as it is expansive. Going digital implies you are interlinked by default. Investment decisions in digital and telecom networks are driven by tests of trust and transparency. Even broader economic links require a security filter given the dual nature of technologies employed. Distinguishing them as purely security or economic is no longer possible. The choice of technology we make, therefore, will become a key determinant of our trade, economic and business linkages. For any bilateral economic partnership, trust and goodwill will become a necessary condition for it to flourish without impediments.

The massive surge in the use of technology and its promising future in India provides an obvious opportunity for Sri Lanka. We are not merely geographical neighbors, we are civilizational twins. Our relations are age-old and wide-ranging. We share our antiquity, and are bound to share our future too. So, choices we make now are that much more vital and will be a determinant of our success in fulfilling the potential of our bilateral relationship.

In its relations with Sri Lanka, India is guided by its Neighbourhood First policy and SAGAR vision. Over the years, we have been a dependable and reliable partner for Sri Lanka. We have been the first responder whenever Sri Lanka has needed our support and assistance. 

In recent years, India’s growing national capabilities is turning it into a better, more effective and meaningful partner for Sri Lanka in its quest for development. India is currently Sri Lanka’s largest source of investment and tourism and Sri Lanka’s top trading partner. We are willing to expand these opportunities by upgrading our Free Trade Agreement and our bilateral investment arrangements. However, the desire to do so has to be mutual and driven by a sense that they are in our mutual interest. As Sri Lanka turns the corner with its economic situation, there is immense potential to realize synergies by deepening our economic partnership. And we are deeply committed to working with Sri Lanka to realize this potential fully.

After the Presidential Elections in Sri Lanka, External Affairs Minister Dr. S. Jaishankar became the first foreign dignitary to visit Sri Lanka. This is indicative of the priority we accord to the bilateral partnership with Sri Lanka. In his meetings with the Sri Lankan leadership, EAM discussed ongoing initiatives in the field of cheaper energy production and grid interconnection, low-cost fuel and LNG supply, solar electrification of religious places, connectivity, DPI, health and dairy development. Our approach is closely linked to Sri Lanka’s priorities and seeks to strengthen the effort of the Sri Lanka Government to fulfill the growing aspirations of its people. Like in the domestic domain, our foreign policy towards Sri Lanka, too, is people-centric – the benefits to them are the only benchmark of our efforts. 

For this reason, India is looking at assisting development of Sri Lanka through investments and grants, and relatively less through debt instruments. This, we believe, serves Sri Lanka better given its recent experiences with debt burdens. For this reason, EAM Jaishankar announced that payments for 07 completed Lines of Credit projects to the tune of 20 million US dollars would be converted into Grant assistance. We have also converted the loan assisted KKS Port modernization project to a grant of 61.5 million US dollars. India has also agreed to Sri Lankan request for supply of 22 diesel locomotives as a grant. Our development projects now are implemented in all 25 Districts of Sri Lanka. We have completed over 60 Grant projects and implementing 16 more at this time. Our assistance includes over 05 billion US dollars of Lines of Credit and about 600 million US dollars of Grant assistance. We have also extended full support to Sri Lanka’s debt restructuring efforts, helped in securing IMF support, and extended bilateral financial support to overcome its immediate challenges.

Sharing best practices from India and replicating our successful experiments with inclusive development and good governance is another important objective. The key to India’s success in this domain has been India’s DPI, which we have offered fully to the Government of Sri Lanka. Going beyond the launch of the digital payments system in Sri Lanka earlier this year, we need to roll out the Sri Lanka-Unique Digital Identity Number project for the full impact of DPI to be felt in Sri Lanka. We are working with the Sri Lankan Government to expedite its implementation through a Grant of about 40 million US dollars. We are confident that this will bring the kind of transformations we have witnessed in India, in the last decade; transformations in the sense of improving governance, ensuring transparency, fostering innovation, or securing social safety nets for the poor and underprivileged. 

Once the foundational UDI is set up, the entire DPI stack can follow. We have also offered training and capacity building for officials through digitization of customs, VAT and direct tax structures as well, making them faceless, paperless and transparent as in India. In fact, senior civil servants from Sri Lanka have already undergone exposure and training in India on use of various e-governance platforms including e-procurement. We are also working to help set up the Gati Shakti platform in Sri Lanka, which is an innovative digital platform for integrated, coordinated and expedited implementation of infrastructure projects in the country. 

Our desire to support Sri Lanka’s economic recovery is reflected also in our efforts to encourage private Indian investments in Sri Lanka. The West Container Terminal at Colombo Port, the recently opened ITC Hotel, the dairy venture, and renewable energy projects are some recent examples. We have already invested in petroleum retail, tourism & hotel development, manufacturing, real estate, telecommunications, banking and financial services. These investments have mostly been in the form of joint ventures, have relied on Sri Lankan talent predominantly and seek to build and augment Sri Lanka’s capacities and capabilities. However, our success in promoting investments in Sri Lanka would, in a large measure, depend on the conditions that the Government helps create. A friendly, welcoming and conducive ecosystem for investments is an absolute necessity. Legal and regulatory stability and fair treatment of investors is key. 

Without a doubt, in a turbulent world, relationship between India and Sri Lanka has been one of the most stable. It has been a role model for neighborly friendship in the region and beyond. We hope that you too will take keen interest in this partnership and in some ways make it your own. That would mean seeking partnerships with your Indian counterparts and also raising your voices in support for more such partnerships. Your active participation can lend an edge to the relationship, especially in the sphere of trade, commerce and investments. 

Let me conclude here by once again thanking all of you for inviting me. I am also grateful for letting me share my thoughts with you. My best wishes to all of you. 

Thank you.