COLOMBO (EconomyNext) – India and Sri Lanka should "move boldly" to integrate their economies and trust each other more, Indian Prime Minister Narendra Modi declared Friday.
Modi told Sri Lankan and Indian business leaders in Colombo that he wants balanced trade growth and would make it easier for the island to do business with her neighbour.
"For me, this is one of the most important meetings in Sri Lanka," Modi told a business forum organised by the Ceylon Chamber of Commerce on the first day of his two-day visit to the island.
"This is because no matter how old and strong the relationship is, economic cooperation is often the locomotive that gives it momentum."
Modi said India is opening up to the world offering duty free access to poor countries and with Free Trade Agreements with others and said Sri Lanka should not "fall behind" in a competitive world.
"That is why India and Sri Lanka should move boldly to conclude a Comprehensive Economic Partnership Agreement," he said.
"You should also attract investments from India for exports to India. That should be the natural outcome of our proximity and your strengths."
Indian investments can also upgrade and expand the island’s infrastructure, he noted.
"It is also natural that Indian investors are more likely to invest here because of familiarity and proximity. They are already here. And, I know that there are many large commitments in the pipeline. They are looking for your support."
Modi said there were many in India who argue that India is too large to need her neighbours and who worry that India’s economic size will hurt them.
"I disagree with both views," he declared. "For one, we all need a stable and peaceful neighbourhood to concentrate on national development.
"I also believe that countries do better when the entire region moves together."
In the last quarter, India was the fastest growing global economy and is confident it can grow even faster, Modi said.
"The world’s engagement with India is at a new level. But, the first claim on us should be that of India’s neighbours."
Modi said India could be a catalyst for economic growth in the region where trade, investment, ideas and people "move easily across the borders."
South Asian countries should work to integrate their markets more.
"We will make trade smoother and possible through the most direct routes," Modi said.
"We will invest in regional connectivity. As a friend and neighbor, we attach the highest importance to Sri Lanka’s economic progress."
India is Sri Lanka’s largest trading partner and one its largest sources of investment.
Modi said he knows Sri Lankans are concerned about the huge trade imbalance with India and that he was ready to work with them to address them.
"I want balanced growth in trade. We will try to make it easier and smoother for you to access the Indian market."
India, he added, will also be supportive in advancing Sri Lanka’s commercial interests.
"We should engage more. We should open up to each other more. We should move forward with greater belief in our own strengths; more trust in each other; and, more confidence in the fruits of our partnership."