SL and India to sign power grid linking pact: Milinda

• Sri Lanka is now seeking to enhance trade and investments as it moves to close a $2.9 billion loan from the International Monetary Fund

Sri Lanka and India will sign a pact to link their power grids and start negotiations on an upgraded trade agreement within two months, Sri Lankan envoy to India Milinda Moragoda said on Wednesday, Reuters news agency reported.  

India has provided some $4 billion in assistance to its southern neighbour since the crisis hit early last year, but Sri Lanka is now seeking to enhance trade and investments as it moves to close a $2.9 billion loan from the International Monetary Fund, he said. “We need to have growth, otherwise basically the economy will shrink,” Moragoda told Reuters.

“As far as growth is concerned, India offers that prospect. So we will have to move on that. Tourism from India, investment from India, integration with India. That’s what we have to do.”  
“We need to have more sources of foreign exchange and electricity will be ideal,” he said. The neighbours will also start negotiations within weeks on enhancing an existing free trade agreement, Moragoda said, as part of a push by Sri Lanka to seal deals with key trading partners, including China and Thailand.

“On our side, we are just about to nominate the (negotiations) team,” he said, adding that the focus would be on enhancing trade in sectors including textiles and garments, a major foreign exchange earner for Sri Lanka.     

• We need to have more sources of foreign exchange and electricity will be ideal,”