Sri Lanka Crisis Impact on India: Due to the unrest in Sri Lanka, its trade with India has almost come to a standstill and in such a situation the concerns of exporters about their payments are increasing. Sri Lanka is facing the most unprecedented economic crisis in seven decades. Here the public is struggling to buy food, medicines, fuel and other essential items.
Indian export organizations
Federation of Indian Export Organizations (FIEO) Vice President Khalid Khan said, “Our exports and imports have come to a complete standstill. Exporters are very cautious about political crisis and payments.” However, he expressed hope that the situation may improve after the formation of a new government in Sri Lanka.
FIEO Director General Ajay Sahai said that political stability will help in business resumption. “At present, such goods are being sent there which come under the credit facility provided by SBI or Exim Bank. These include raw material for industry, medicine, fertiliser, food and textiles,” he said.
Trade statistics between India and Sri Lanka
In the financial year 2021-22, there was an export of $ 5.8 billion from India to Sri Lanka, in April this year it was $ 550 million. In the last financial year, there was an import of $ 1 billion, while in April 2022 it was $ 74.68 million. The Free Trade Agreement between India and Sri Lanka was signed in the year 2000.
Sharad Kumar Sarraf, Mumbai-based exporter and president of Technocraft Industries, says, “Trade has come down sharply. Exporters are worried about payments. My trade with Sri Lanka fell 25 per cent since January.” Rajesh Menon, director general of SIAM, an association of vehicle manufacturers, said Sri Lanka is an important market for the domestic automobile industry. “We hope that the economic situation there will improve as soon as possible,” he said.