INDIA SRI LANKA ECONOMIC AND TECHNOLOGICAL COOPERATION AGREEMENT

Copyright infringement is not intended

Context: Sri Lanka will soon resume talks with India on the stalled Economic and Technological Cooperation Agreement (ETCA), authorities said, as Colombo looks to trade pacts and foreign direct investments to rebuild its crisis-hit economy.

Details:

• 11 rounds of bilateral talks have been held between 2016 and 2019 with the aim of broadening and deepening the [ISFTA] that is in force since India-Sri Lanka Free Trade Agreement
• The ETCA faced considerable resistance from sections within Sri Lanka, mainly from nationalist groups and trade unions who saw the pact as giving India an unfair advantage.
• The ETCA itself followed decade-long, but futile, negotiations on yet another pact — the “Comprehensive Economic Partnership Agreement (CEPA)”.
• Sri Lanka’s recent emphasis on FTAs and FDIs is part of President Ranil Wickremesinghe’s strategy for economic recovery in the island nation, reeling under the impact of its worst economic crash.
• The country’s economy contracted by an estimated 9.2% this year and is estimated to contract by a further 4.2% in 2023, according to the World Bank. Meanwhile, the government is talking to its creditors to restructure its foreign debt and qualify for IMF support early next year.
• Sri Lankan PM underscored the need for Sri Lanka to have greater access to the world market. Towards this end, Sri Lanka has resumed efforts to integrate with key markets such as India and China.
• India and China are the top two sources of import for Sri Lanka.

https://epaper.thehindu.com/Home/ShareArticle?OrgId=GTKAK34HA.1&imageview=0