Last week, Indian External Affairs Minister S. Jaishankar visited Sri Lanka; his first in the region since his reappointment in Prime Minister Narendra Modi’s Cabinet. 

Though the one-day visit was a routine affair and meant to appraise the Southern neighbour of New Delhi’s commitment to the bilateral relationship, Dr. Jaishankar reportedly took stock of the progress of the Indian-funded development projects and, more importantly, underscored the need for policy consistency in Colombo, and non- derailment of India funded projects, whatever the outcome of the upcoming elections.

That is a legitimate concern, considering the fickle economic policies in Sri Lanka and increasingly virulent political rhetoric in talk shows and press conferences, promising to revisit agreements, including the life-saving programme with the IMF. 

Fickle politics aimed at personal and political glory has been the bane of Sri Lanka’s economic policy, which has seriously

undermined investor confidence and strained bilateral relations. The calls for consistency in policy and honouring the agreements that have already been entered have been a demand by all major development partners- from China, India, Japan and the US.

Tokyo, which had maintained cordial relations, even during the height of the war, was the first to demand laws to make successive governments abide by the contractual obligations of bilateral agreements as a pre-condition for future cooperation after Gotabaya Rajapaksa unilaterally scrapped the Japanese-funded Colombo monorail project.  

New Delhi itself has regularly complained about the slow progress of India-funded development projects, owing to bureaucratic red tape, though such actions were not necessarily confined to Colombo. The regular high-level meetings serve as grease that expedites the clogged machines of the state bureaucracy. 

The president’s office, in a media communiqué stated that President Wickremesinghe and External Affairs Minister Dr. Jaishankar discussed ongoing and proposed initiatives aimed at enhancing energy connectivity and developing the renewable energy sector, LNG supply, a proposed petroleum pipeline linking the two countries, and advancing oil and gas exploration projects, India’s support for developing Trincomalee and expanding the Kankasanthurai ports and Sri Lanka’s unique digital identity card project.

It was also announced that construction of the Sampur Solar Power Plant is set to commence in July 2024. 
Some of the projects that were mentioned, such as energy connectivity through pipelines and Indian-funded digital national ID cards, have been opposed by the usual culprits in the JVP, insular ethno- nationalists and Rajapaksa acolytes. 

Dr. Jaishankar also formally commissioned the Maritime Rescue Coordination Centre (MRCC), comprising a main centre at the Colombo Naval Headquarters, a sub-centre in Hambantota, and unmanned installations in strategic locations across Sri Lanka’s coastline. 

Backburner

This innocuous maritime security arrangement was also vehemently opposed during the Gotabaya Rajapaksa administration and remained on the backburner until now. 

It is generally accepted that the smaller nations could enhance their security and international profile by providing public good (which the MRCC intends to provide) and integrating themselves into global supply chains, thereby interlocking their security and survival with the security of the rest, including the great powers. 

But, a good number of smaller countries also elect dogmatic fools who often scuttle plans for greater association and cooperation in mutually beneficial arrangements. 

Conspicuously absent in the media statements was another key bilateral partnership, the Economic and Technology Cooperation Agreement (ETCA) which has the potential to turbo-charge  Sri Lanka’s service exports by interlocking itself with India’s massive ICT industry. India’s service exports for the fiscal year 2023-2024 were valued at US$ 339 billion. However, local pundits and trade unions have opposed the deal, fearing Indian techies would steal their jobs. Talks have regularly been stalled due to domestic political calculations.

The absence of any mention of ETCA may also be due to the same concerns as the country is heading for a presidential election.

Policy inconsistency, or the absence of a coherent economic policy, is a salient feature of Sri Lanka, where the state policy has been a victim of the whims and fancies of politicians whose short-termism prevails over the national interest. The cancellations and reneging of previous agreements are devoid of any economic logic and are driven by personal and political calculations of the political leadership at the time. 

Gotabaya Rajapaksa reneged on a MoU signed with Japan and India over the Colombo Port’s Eastern terminal and later, after an international outcry, handed over the Western Terminal of the Port to the Adani Ports, projecting it, erroneously as a government-to-government agreement.

Gotabaya also scrapped Japan’s development agency-funded Colombo monorail project, not so much out of economic merit, but, since it was initiated by his political opponents. Simultaneously, as if it were a consolation prize, Gotabaya launched the construction of the second terminal of the Katunayake International Airport, funded by JICA, which Ranil Wickremesinghe negotiated but was prevented from implementing by the local pundits who thought they knew better than the Japanese.

The Chinese-funded Colombo Port City was one of the earliest victims of fickle domestic politics, and so was the Millennium Challenge Cooperation grant of US$ 480 million. 

As Sri Lanka concluded the debt restructuring with its bilateral and private creditors and the president addressed the nation on Wednesday - the country should also evolve a consensus on the economic policy. However, the ugly truth about the multiparty democracy in countries with low economic and social development is that the ecosystem favours charlatans, who bring neither value nor integrity but only amplify the cacophony of discordant voices.   

Daily Mirror reported Dr. Jaishankar briefed Prime Minister Dinesh Gunawardene on how the Modi campaign prevailed over India’s teaming population. 

Probably Sri Lanka should take lessons from India’s government on a far more important matter. How Prime Minister Modi managed to bring coherence to an enormous, fragmented and bickering state, often overlooked as a backwater in economic growth, into the engine of global economic growth for the next twenty years.

Congress administration 

Some observers point out that the growth rate of the previous Congress administration of 2004-2014 was slightly higher than that of Modi’s two terms. Though statistically, that may be true, that is, a hit-and-run economic growth achieved in blind, a product of India’s latent capacity and much less due to the role of the government as a catalyst for growth. Until recently, India did not even have a unified GST sales tax. Whereas Modi has transformed the state into a juggernaut of economic mobilisation, an able manager of economic modernisation, a feat hitherto conferred to the Chinese Communist Party, and provided a long-term growth trajectory built on long-term coherent state policies, probably with a dose of authoritarianism, which is a necessary evil, if one is to survey the development pathways of all successful high growth nations in East and South East Asia. 

Ranil Wickremesinghe should probably ask what Sri Lanka could learn from Modi’s transformation of the Indian state. Whether there is a particular recipe or solely a product of Modi’s personalisation of the state is a concern. But, some of the lessons can be replicated in Sri Lanka. 

However, since the days of Suhartos and Pinochets are long gone, Wickremesinghe will have to win the election first. 

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