[Draft Book Chapter] South Asia in transition: India-Sri Lanka relations in the twenty-first century Arijit Mazumdar, Phd assistant Professor of Political Science University of St

United States in South Asia

During the Cold War, Sri Lanka was part of the non-aligned world and hence had limited interactions with the US. It did not loom large in US security calculations. With respect to South Asia, Afghanistan, Pakistan and India were priority states for the US during the Cold War. However, after economic liberalization during the late-1970s, Sri Lanka began to cultivate a strong relationship with the West, including the US. The US soon became an important export destination for its garment products. In 2011, total bilateral trade amounted to $2.4 billion up 13.4% over the previous year (Office of the United States Trade Representative 2012).

Sri Lanka enjoyed a positive trade balance with the US in 2011 as it exported $2.1 billion worth of goods, while importing $307 million worth of goods. In order to address the trade deficit, the US government is in the process of negotiating with the GoSL to reduce the high tariffs on US agricultural products, open the Sri Lankan market for agricultural biotechnology products, provide transparency in government procurement and enforce intellectual property rights. Foreign Direct Investment (FDI) from the US amounted to $130 million in 2010 (Office of the United States Trade Representative 2012). Greater market access for US companies is expected to lead to higher volumes of investment. The US government has provided development assistance through USAID and was one of the major contributors to the international tsunami aid in 2004.
During the civil war, the US refused to supply lethal military weapons to the GoSL because of concerns regarding its human rights record and the fear that such weapons could cause more civilian casualties (Mumtaz 2004). In 1997, the US Department of State designated LTTE as a foreign terrorist organization. Following 9/11, the US and other western countries placed restrictions on the ability of the LTTE to raise funds through the Tamil diaspora. This factor was crucial in choking off arms and ammunition for the LTTE leading to its military defeat. Since Sri Lanka’s independence, the US has always supported the sovereignty and territorial integrity of the country. It wants to see a solution to the ethnic conflict within the framework of a united Sri Lanka. It has supported the reconstruction process in the island. It has encouraged the GoSL to take measures to resettle the IDPs of the civil war at the earliest. It has voiced its support for the process of ethnic reconciliation on the island. The US has also expressed concern about the continuing Sri Lankan military presence and lack of a functioning provincial council in the north.
In recent times, the alleged human rights violations related to the final stages of the civil war have been of primary concern for the US (Vaughn 2011). Following the UN advisory panel report in 2011 calling for investigations into alleged war crimes committed by both the GoSL forces and the Tamil Tigers, the GoSL established the LLRC. However, the LLRC’s recommendations have yet to be implemented. Frustrated by the lack of progress on the issue, the US sponsored a resolution in the UNHRC calling upon the GoSL to implement the recommendations (Schaffer 2012). This action has strained bilateral relations. Rajapakse’s government suspects that the US wants to divide the island. For Sinhalese nationalists and Buddhist leaders, the actions of the US feed into the narrative that the majority community in the island is under siege.

Through the UNHRC resolution, western countries have indicated that there can be no reconciliation without accountability. A few have suggested an independent investigation into the allegations of human rights violations during the last days of the civil war. In July 2010, the EU suspended preferential treatment for Sri Lankan imports because the GoSL had yet to properly investigate human rights violations. The loss of the “Generalized System of Preferences (GSP)-plus” benefits would mean higher tariffs on imports from Sri Lanka, which are worth about $1.56 billion annually. Sri Lanka’s garment and fisheries industries would be hurt the most with some tariffs jumping from zero or near zero to as high as 18 percent (Bajaj 2010).

The GoSL believes that economic development, not a political settlement will lead to lasting peace on the island (Schaffer 2012). It believes that the primary reason for the ethnic conflict is the lack of economic development in the northern and eastern provinces. Therefore, addressing the economic issues will reduce alienation among Tamils. Responding to political grievances is subordinate to the larger task of economic development. The GoSL is also aggrieved by US insistence on addressing the human rights and reconciliation issues. It believes that the US should be lauding Sri Lanka’s successful prosecution of its war on terrorism and would project it as a model for other countries. It finds it difficult to understand why the US would be voicing support for what it believes are pro-Eelam forces within the country. The Rajapakse government’s belligerence has strained relations with Western countries. Some countries have called for an independent investigation, but if the government continues to stonewall then there may even be calls for an international probe. The government cannot afford to be isolated by the international community, especially the US.
The interests of the US and India coincide to a large degree with regard to Sri Lanka. In recent times, the US has recognized that India is a major player in South Asia and accepted its hegemony over the region (except when it comes to Pakistan). It has coordinated with India to achieve its objectives in South Asia, including Sri Lanka. It is dependent on India’s support to maintain pressure on the GoSL to address human rights concerns. It has attempted to articulate its concerns utilizing both bilateral and multilateral forums. Like India, the US has also supported the unity and territorial integrity of Sri Lanka but wants to see measurable progress in the reconciliation process and greater accountability regarding human rights.
The US wants the GoSL to act with a sense of urgency to deal with the growing problems in the northern province. It is also concerned about the growing authoritarianism on the island and continuing attacks on media persons and journalists. It is concerned about the lack of access to individuals settled in government-run camps and the relatively slow process of their resettlement (Vaughn 2011). For the most part, it has attempted to use quiet diplomacy, instead of public condemnation to encourage the GoSL to respond to its concerns. The US does not want to seem to be coercing Sri Lanka because this may alienate the populace. It wants to remain engaged in Sri Lanka and no let any single issue dominate the agenda. Sri Lanka has already suffered from the loss of the EU ‘GSP-plus’ treatment. It was in danger of losing the GSP trade benefits provided by US as well due to concerns about worker rights in Sri Lanka. However, following a review of practices in Sri Lanka in 2012 the Office of US Trade Representative declared that the government had made noteworthy efforts to address worker rights issues over the past few years.
Apart from an interest in the human rights accountability, ethnic reconciliation and the resettlement and reconstruction process in the post-civil war period, the US is drawn to Sri Lanka because of its strategic location of the island in the Indian Ocean (Mumtaz 2004). Maritime trade routes between Persian Gulf and South-East Asia pass through Sri Lanka’s Colombo port. A majority of India’s imports from the Persian Gulf pass through Colombo port. In addition to India, China has also expanded its presence in Sri Lanka leading both the US and India to adopt a more conciliatory approach to Sri Lanka. The two countries fear that pushing Sri Lanka too hard on the issue of human rights violations and national reconciliation would be counter-productive since it would drive the country into the arms of China. Already, press reports in Sri Lanka have hailed China as a ‘true friend’ of the country for its vote against the UNHRC resolution (De Alwis 2010).
In recent times, China has emerged as the largest supplier of military weapons and equipment to Sri Lanka (International Crisis Group 2011). During the civil war, China supplied fighter-aircrafts, air surveillance radars and anti-aircraft guns to Sri Lanka. When India refused to provide military aid to Sri Lanka, China stepped in to help Sri Lanka out. The GoSL has more than once expressed its gratitude for this support, even as India and the US refused to supply lethal weapons and equipment to it. China has enhanced its profile in Sri Lanka (Jain 2010: 149). Chinese cover allowed the GoSL to bring the civil war to a successful conclusion despite western pressure to halt the military offensive. After the civil war ended, China prevented the UNSC from considering a resolution regarding allegations of human rights violations by Sri Lankan forces (De Alwis 2010). It strongly opposed the UNHRC resolution in March 2012. China has provided development assistance to the island country in terms of grants and loans. In 2009, China emerged as the largest aid donor to Sri Lanka. It is an important trading partner and lender for Sri Lanka. Unlike the West, China did not tie the expansion of commercial relations to progress on human rights and political settlement.
China is engaged in rebuilding the infrastructure of the war-ravaged country. The primary hub of Chinese activity in Sri Lanka today is Hambantota port located in the south of the island (Das 2010). It is the closest port to commercial shipping routes between the Persian Gulf and South-East Asia. The Chinese government has sanctioned over $300 million for the development of the first phase of the project, which include building oil and gas terminals and berth and terminal facilities. China is believed to be interested in developing Hambantota port because it would provide refueling and docking facilities for Chinese merchant ships traveling along the shipping routes (Kaplan 2010: 195).
However, Chinese involvement in this project has raised concerns in India. This project is seen as an essential element of China’s ‘string of pearls’ strategy that involves the development of ports across the South-East and South Asian region (Kaplan 2010). The Hambantota project appears similar to other Chinese port development projects like Gwadar (Pakistan), Chittagong (Bangladesh) and Sittwe and Kyaukpyu (Myanmar). Some sections of India’s strategic community believe that China is attempting to ‘encircle’ India through these projects and undermine its regional hegemony. Instead of serving as refueling and docking stations for merchant ships, these ports are expected to be utilized by the Chinese navy. India is also concerned about the possibility of the Chinese navy gaining access to Trincomalee harbor on the eastern side of the island. The harbor has been coveted by many foreign navies in the past because of its large size and all-weather access to all types of ships. Using the harbor as a base, any large navy could easily project force and monitor maritime traffic throughout the Indian Ocean.
Growing Sri Lanka-China relations has accelerated India’s engagement with Sri Lanka. Fears about being ‘outflanked’ by the Chinese have forced India to pay greater attention to its South Asian neighbor. However, there is little reason for India to be excessively worried about Chinese influence in Sri Lanka. In reality, China has a legitimate interest in ensuring the security of its maritime trade routes to the Persian Gulf (Kaplan 2010). Although Chinese investment, equipment and personnel are helping develop Hambantota port, once the project is complete there will not be any Chinese presence. India needs to understand that unlike Afghanistan, Pakistan (through Pakistan-administered Kashmir), Nepal and Bhutan, Sri Lanka does not share a land border with China. It is thousands of miles away, with no direct road or rail access. As such, China’s influence on Sri Lanka would therefore be relatively limited (Hariharan 2012).
Sri Lanka cannot afford to depend solely on China for its needs. India is after all the largest investor and trade partner. The Sri Lankan tourism sector is dependent on tourists arriving from India in large numbers. India is also the only neighbor of Sri Lanka. Unlike China, Sri Lanka and India share language, ethnic and cultural ties, beyond commercial ties (Das 2010). In addition, the US and EU are important trading partners. Since Rajapakse’s government is interested in rebuilding Sri Lanka, support from India and the Western countries is crucial. It should be understood that China would also not want to unduly provoke India as its own commercial relations with that country are stronger than ever. China is India’s largest trading partner and as the relationship grows, it is expected that China will be mindful of India’s sensitivities regarding its regional interests.
The US is also apprehensive about China’s growing influence in Sri Lanka. At present, the US is in the process of trying to persuade Sri Lanka to respond to its concerns. It has also declared support for the growth of a strong democracy in Sri Lanka. For India, US engagement in Sri Lanka serves to keep the pressure on the Rajapakse government to respond to human rights accountability and national reconciliation issues. In conjunction with the US, India hopes to persuade the Rajapakse government to reverse the recent trend of centralization of power in Sri Lanka. It also hopes that US engagement will help it to maintain influence in Sri Lanka and be a counter-weight to China. It is true that India is to some degree wary about growing US influence in South Asia, but since the regional interests of the two countries coincide to a large degree US presence has been welcomed.
Both the US and India can work together to usher in change in Sri Lanka. The US could pressure Sri Lanka to respond to allegations of human rights violations and initiate a national reconciliation process, while India can appear supportive and sympathetic to Sri Lanka’s concerns (essentially both countries can play the ‘good cop/bad cop’ routine). A ‘carrot-and-stick’ approach may help bring about changes in Sri Lanka. However, both the US and India must take care not to marginalize or isolate Sri Lanka. As mentioned before, the GoSL could seek Chinese assistance to deflect pressure, but geographic and political realities will mean that whatever Chinese assistance that comes will be limited in nature.
The US and India should understand that even if they don’t push Sri Lanka, the latter may still pursue greater engagement with China. As such, both the US and India should support the process of democratic consolidation in Sri Lanka. There is little possibility of alienating Sri Lanka because the latter would not want to jeopardize its traditionally close ties with the US and India. The two countries should support the emergence of a strong civil society in Sri Lanka. The strong state in the country can only be ‘balanced’ through an active civil society that can hold the government accountable. Ethnic reconciliation will be a slow process but the two countries should insist that Sri Lanka stay the course and not brush the issue under the carpet.
Reversing the process of centralization of power, assisting in reconstruction and rebuilding and initiating national reconciliation is necessary for India to develop a comprehensive relationship with Sri Lanka. The recent US involvement in Sri Lanka’s affairs is a positive development for India. It is expected to give a push to the Rajapakse government to reform. It would also be a hedge against greater Chinese influence in the South Asia region. Much like US involvement in other countries, its interactions with Sri Lanka are likely to produce changes within the domestic political system (not just democratic transition) of the country and assist in the process of re-orientation of India’s ties with its southern neighbor. Greater US engagement in Sri Lanka serves India’s interests through encouragement of national reconciliation, support for democratic norms, and controlling Chinese influence. This is expected to contribute to further growth in bilateral ties between India and Sri Lanka.
Summary and Conclusion

Since ancient times, India and Sri Lanka have shared deep cultural and economic ties. Dravidian culture and Buddhism spread to the island from India. Two distinct ethnic groups, the Sinhalese and Tamils have made the island home. Although there are records of historical battles between Sinhalese and Tamil kingdoms, the relationship between the two groups have been relatively cordial through the centuries. During the nineteenth century, a strong Buddhist revival movement and Sinhalese nationalism strained relations between the majority community and the Tamils. After independence, successive Sinhalese-dominated governments implemented laws that favored the majority community, while ignoring the interests of the Tamils. The marginalization and frequent pogroms against Tamils set the stage for the civil war in Sri Lanka. After thousands of deaths, the twenty-six year-long war finally came to an end in 2009.

Both India and Sri Lanka gained independence from the British around the same time. They inherited political institutions and democracy from the British. However, the paths of the two countries diverged significantly during the decades after independence. In Sri Lanka, the Tamils struggled to receive a fair treatment from the state. India could not remain immune to the events taking place in Sri Lanka. The political status of the Tamil minority in Sri Lanka soon became an issue of concern for India. India’s acceptance of some plantation Tamils inadvertently set the stage for continuing Indian involvement in the ethnic conflict on the island. Relations between the two countries were cordial until the late-1970s, when Sri Lanka began to pursue an economic liberalization program and drew closer to the West.
Around the same time, militant Tamil groups, including the LTTE, began a campaign of violence against the state. Uneasiness about Sri Lanka’s growing links with extra-regional actors and concerns about the plight of Sri Lanka’s Tamil citizens forced India to intervene in 1987. However, the intervention proved a failure and strained bilateral relations. Later, India adopted a ‘hands-off’ policy towards the ethnic conflict on the island. Bilateral trade grew during the first decade of the twenty-first century, but India refused to supply arms to the Sri Lankan military or mediate in the civil war. India welcomed the end of the civil war not least because it was happy at the military defeat of the LTTE, which it felt was not representative of the Tamils and was a stumbling block towards achieving national reconciliation in Sri Lanka.

The end of the civil war provides both countries an opportunity to reshape ties. There are several reasons for this. First, there is less fear about the ethnic conflict spilling over into Tamil Nadu. Second, the military defeat of the LTTE is a victory against international terrorism in the region. Third, India is now in a position to engage Sri Lanka without the baggage of the civil war. Tamil Nadu-based political parties can no longer pressure India to restrict ties with Sri Lanka claiming that Indian economic and military assistance would contribute to more deaths among Sri Lankan Tamils. Fourth, there is greater opportunity to develop economic ties now. The FTA provides both countries with the framework to enhance trade and investment links. When the CEPA is finalized, it would help Indian investors gain access to more services sectors in Sri Lanka. The end of the civil war would also lead to less disruption in trade and create a better investment climate in Sri Lanka.

Fifth, India can now explore the possibility of defense cooperation with Sri Lanka. The Indian Navy is particularly interested in gaining access to Trincomalee harbor, but this would only be possible after the development of strong ties between armed forces of the two countries. This was not possible during the civil war, again because of opposition from Tamil Nadu-based political parties. Sixth, there is less opportunity (or need) for Sri Lanka to develop military links and/or alliances with extra-regional actors. India’s refusal to provide weapons and equipment to the Sri Lankan forces during the civil war forced the GoSL to look to other states. This was one of the major concerns of India and contributed to the downturn in bilateral relations. Seventh, the pressure exerted by the US on Sri Lanka regarding human rights violations and reconciliation serves India well. Together with the US, India is in a position to persuade the Sri Lankan government to reverse the trend of centralization of power and relax emergency laws. The strengthening of democratic forces on the island will have a positive impact on bilateral ties. Finally, the Indian government can finally pressure the GoSL to fully implement the provisions of the thirteenth amendment, which represents a possible blueprint for securing political and economic rights for the Tamil minority. In the past, the GoSL could claim that it was engaged in a civil war and any political settlement would have to wait until the LTTE was defeated. Now that the war is over, the GoSL has no excuse but to seriously consider the full implementation of the thirteenth amendment.
Majoritarian institutions in Sri Lanka have failed to cater to the demands of the minority/opposition groups within these countries. A ‘winner-takes-all’ system has contributed to a situation where there is little consensus on issues like national ideology, the nature of the state, economic policy and foreign relations. In Sri Lanka, majoritarian institutions contributed to ethnic polarization between the majority Sinhalese and minority Tamils, resulting in violent conflict. Since the 1990s, Sri Lanka has attempted to build a strong economic relationship with India. This is the result of greater capacity and dynamism of the Sri Lankan economy. The challenge for India and Sri Lanka is to now craft a bilateral relationship that builds on the existing economic links. Currently, India-Sri Lanka relations are better than they have ever been. However, it will require political will on both sides to ensure that bilateral political issues, sidelined earlier in favor of economic ties, are addressed to mutual satisfaction. If this is the case then it is quite likely that India-Sri Lanka relations may become a model for India’s relations with other South Asian countries in the future.

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