New Delhi: In a major development, Prime Minister Narendra Modi announced to supply of liquefied natural gas (LPG) to Sri Lanka’s power plants during a joint presser with the visiting Sri Lankan President. The announcement came during a joint presser of PM Modi and President Anura Kumara Dissanayake. During the event, the Prime Minister said New Delhi will work on connecting the power grids of the two countries as well as lay a petroleum pipeline between the neighbours.
Energy Development
Emphasising the need for reliable, affordable and timely energy resources for ensuring energy security and meeting the basic needs of the people, both leaders underscored the importance of strengthening cooperation in the energy sector and facilitating towards timely implementation of ongoing energy cooperation projects between India and Sri Lanka. In this regard, the leaders agreed to:
i. Take steps towards the implementation of the solar power project in Sampur and further augment its capacity as per the requirements of Sri Lanka.
ii. Continue consideration of the several proposals which are in different stages of discussion including:
(a) supply of LNG from India to Sri Lanka.
(b) establishment of a high-capacity power grid interconnection between India and Sri Lanka.
(c) cooperation amongst India, Sri Lanka and UAE to implement a multi-product pipeline from India to Sri Lanka for supply of affordable and reliable energy.
(d) joint development of offshore wind power potential in Palk Straits, while prioritizing environmental protection including fauna and flora.
Acknowledging the ongoing cooperation in the development of Trincomalee Tank Farms, both leaders decided to support the development of Trincomalee as a regional energy and industrial hub.
Strategic & Defence Cooperation
Recognizing the shared security interests of India and Sri Lanka, both leaders acknowledged the importance of regular dialogue based on mutual trust and transparency and giving primacy to each other’s security concerns. As natural partners, both leaders underscored the common challenges faced by the two countries in the Indian Ocean Region and reaffirmed their commitment to work together in countering traditional and non-traditional threats as well as to ensure a free, open, safe and secure Indian Ocean Region. India is Sri Lanka’s closest maritime neighbour, President Disanayaka reiterated Sri Lanka’s stated position of not permitting its territory to be used in any manner inimical to the security of India as well as towards regional stability.
Expressing satisfaction at the ongoing defence cooperation in training, exchange programs, ship visits, bilateral exercises and assistance to augment defence capabilities, both leaders agreed to advance maritime and security collaboration.
President Disanayaka thanked India for its support through the provision of a Dornier Aircraft for maritime surveillance; and establishment of the Maritime Rescue and Coordination Centre in Sri Lanka amongst other assistance vital for Sri Lanka to enhance its maritime domain awareness. He further appreciated India’s role as a ‘first responder’ for Sri Lanka in the field of Humanitarian Assistance and Disaster Relief. Importantly, the recent success in collaboration efforts of Indian and Sri Lanka Navies in the seizing of vessels trafficking a large quantity of narcotics with suspects was mentioned and President Disanayaka expressed his gratitude to the Indian Navy.
Debt Restructuring
President Disanayaka conveyed his deep appreciation for the unwavering support extended by India to the people of Sri Lanka during and after the unprecedented economic crisis in 2022. Recalling his profound commitment to fulfilling the aspirations of the Sri Lankan people for a prosperous future, greater opportunities, and sustained economic growth, he looked forward to India’s continued support for the achievement of these objectives. Prime Minister Modi assured President Disanayaka of India’s full commitment in this regard, in keeping with the special place Sri Lanka occupies in India’s ‘Neighbourhood First’ policy and ‘SAGAR’ vision.
President Disanayaka thanked Prime Minister Modi for India’s support in stabilizing the Sri Lankan economy through unparalleled and multi-pronged assistance including emergency financing and forex support worth USD 4 billion. He acknowledged India’s crucial assistance in Sri Lanka’s debt restructuring process, including as co-chair of the Official Creditors’ Committee (OCC), as being instrumental in finalising the debt restructuring discussions in a timely manner. He further thanked the Government of India for extending financial assistance of USD 20.66 mn to settle payments due from Sri Lanka for projects completed under existing Lines of Credit thereby significantly reducing the debt burden at a critical time. Underscoring the close and special ties with Sri Lanka, Prime Minister Modi reiterated India’s consistent support to the country in times of need and in its quest for economic recovery and stability, and prosperity for its people. The leaders instructed officials to finalize discussions on the bilateral MoU on Debt Restructuring.
Both leaders agreed that a strategic shift from debt-driven models towards investment-led partnerships across different sectors would ensure a more sustainable path to economic recovery, development and prosperity in Sri Lanka.
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