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Indian interest increasing, says Sri Lankan official

By Our Staff Reporter

BANGALORE, OCT. 5. More Indian firms were considering investments in Sri Lanka, for its "strategic location," mostly to use it as a base from which to export their products, said a visiting Sri Lankan official here to promote the island as a destination for business, on Tuesday.

The ease with which the government's Board of Investment (BoI) "facilitated setting up of operations" and more recently, access to the domestic market, were also reasons for Indian firms to start business in Sri Lanka. These firms were looking at sectors such as manufacturing, textiles, light engineering and business process outsourcing, said, C. Ignatius, a senior manager for trade promotion in the BoI.

Mr. Ignatius said Indian firms, which started taking more interest after the free trade agreement with India in 1998 that became effective four years ago, now numbered 73 in Sri Lanka. They had brought in investments of about $200 million.

Those numbers, of both firms and investment, were expected to double in the next 18 months: Some 75 firms would bring in investments of about $225 million. Nearly 80 per cent of these firms would set up export oriented units, he said.

Indian firms already in Sri Lanka included Ceat, Tata Tea, Apollo Hospitals, IOC, Ashok Leyland, Asian Paints, GDP Steels and the Taj Hotels. Ceat had become the single largest tyre maker in Sri Lanka, exporting its products to India, the Philippines, Singapore and Africa, he said.

Other areas where there was "scope for business" included IT education, and testing of products and concepts for global markets.

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