Indian CEO forum flags opportunities in island nation; backs visa-free entry for Sri Lankans

There has never been a better time for Indians to invest in Sri Lanka, the Indian CEO Forum here said, even as it invited the Indian private sector to take advantage of the current business environment in the island.

“There is tremendous scope for investment in many sectors, from food to apparel to electrical appliances,” said Umesh Gautam, president of the Colombo-based organisation, which has close to 60 Indian investors and corporate leaders operating in Sri Lanka. “Indian businesses could offshore part of their supply chain in Sri Lanka to re-export to the Indian market.”

Mr. Gautam is the CEO of Lanka Ashok Leyland, set up in 1982 as a joint venture with the Government of Sri Lanka. “We [Indian investors] were here during the war, during the most troubled times. But now, keen on tapping the country’s peace dividend, many other countries are rushing to invest here. India should not miss the bus,” Mr. Gautam said in an interview.

The Indian CEO Forum had welcomed Sri Lanka’s recent budget, lauding the government’s efforts towards “structural reforms” and greater “trade liberalisation”.

‘Easier to do business’

While the World Bank’s ‘Ease of doing business’ rankings for 2017 place India at 100 and Sri Lanka at 111, the island nation is more business friendly, according to Mr. Gautam.“From my 30 years’ experience of living and working in Sri Lanka, I can tell you that the ease of doing business is far greater here than in India.”

India must also make it easier for Sri Lankans to visit, he said. “India must enable visa-free travel for Sri Lankans.” The island nation is India’s largest trading partner in South Asia, with total bilateral trade in 2015-16 surpassing $6 billion.

The two countries are currently negotiating an Economic and Technology Cooperation Agreement (ETCA), building on an existing free trade pact. The business community in Sri Lanka is divided, with a section opposed to the proposed accord citing non-tariff barriers imposed by India. Trade unions, on the other hand, are worried about implications for the Sri Lankan labour force that is under enormous pressure with growing precariousness and stagnant wages.

Making a case for ETCA, Mr. Gautam said: “Much of the opposition... to ETCA from within the business community stems from personal inconveniences that Sri Lankan businessmen have had in India. Once that is addressed, everyone will welcome the agreement.”