India and Sri Lanka are neighbouring countries to each other and are in very near proximity. The Southeast Asian countries are actively participating in a close bilateral trade with each other as among India and Sri Lanka, the latter is in a hugely problematic situation with multiple stressors.
Though India has provided assistance to Sri Lanka in battling its ongoing economic crisis, India’s neighbouring country might be on the verge to record a loss in shipments from India in the upcoming months, most likely due to the inability to pay, as per the analysts.
India-Sri Lanka Bilateral Trade
India and Sri Lanka share a close relationship in bilateral trade as India is Sri Lanka’s biggest trading partner with a total worth of imports and exports amounting to $4.02 billion and $980.7 million respectively for the year ending 2021. Imports are, of course, the highest here.
The representation of Sri Lanka’s imports and exports in relation to India is shown below for the past 4 years, spanning from 2018 to 2021. The highest amount of imports and exports of Sri Lanka in relation to India in recent years has increased in 2021 after the pandemic in 2020.
India’s Top Exports To Sri Lanka
Major products exported from India to Sri Lanka for 2021 include sucrose products ($277.2 million), mixed medicinal products ($261.5 million), knitted or crocheted fabrics ($343.4 million), and spices of pepper, chilly powder ($112.4 million) with other commodities featured in the list.
Major exported products from Sri Lanka to India for 2021 include spices of pepper, chilly powder ($123.1 million), animal fodder preparations ($111.3 million), fresh or dried nuts ($51.0 million), hydrogenated oils ($48.8 million), and recovered waste paper ($44.7 million) with others.
Have Imports In Sri Lanka Went Down?
The answer to the question of “are imports in Sri Lanka from India going down?” is— “not exactly”. According to analysts, as per recent reports on the internet, Sri Lanka imports are expected to go down. The decline in imports might be only due to the financial crisis and inability to pay, not the availability of enough commodities in Sri Lanka.
If anything, Sri Lanka needs more consignments to meet the domestic demand. Fabric commodities, essential staple food such as sugar, and medicines are the highest imported commodities for 2021 in Sri Lanka from India. The below represented comparison chart/graph shows the comparison between the two periods in the years 2021 and 2022 respectively with monthly values. The value in 2022 is comparatively less than the 2021 values but in motion.
It comes pretty clear that as of now, demand for several commodities in Sri Lanka exists and will prevail for a while till the country pull itself out of the economic crisis with the help of neighbouring countries such as India, Bangladesh, and China. Sri Lanka’s agricultural industry is a volatile commodity market and could uplift the economy with the exports of commodities such as textile, garments, tea, spices, and other similar commodities.