Suchergebnisse

section 1. Country studies: India / S. Irudaya Rajan ; Pakistan / Rizwana Siddiqui ; Sri lanka / Nisha Arunatilake, Priyanka Jayawardena and Dushni Weerakoon ; Bangladesh / Selim Raihan and Syed Al-Helal Uddin ; Nepal / Jagannath Adhikari ; Bhutan / Sonam Tobgay ; The Maldives / Deshal De Mel and Suwendrani Jayaratne ; Afghanistan / Tilani Jayawardhana and Roshini Jayaweera -- section 2. South Asia: South asia : issues on migration and development / Piyasiri Wickramasekara ; Case for a south asia migration commission / Farooq Sobhan.

Revised version of papers presented at the International Conference on "Trade in Services in South Asia : Opportunities and Risks in Liberalization", held at Colombo during 4-5 April 2007

This article fills a gap in the literature by focusing on the growing economic links between China and Sri Lanka. Starting from the 1952 Rubber-Rice Pact, the economic relations between the two countries have grown over the years with an unprecedented growth since 2005. Chinese military assistance helped overcome three decades of conflict in North/East Sri Lanka and Chinese financial assistance to other areas of the Sri Lankan economy, in particular, infrastructure development have also strengthened. Although Sri Lanka's trade and investment links with China are not very strong, the increased Chinese financial assistance has had some spill over effects in strengthening these in recent years. Sri Lanka will sign a Free Trade Agreement with China most probably in 2014 but growing economic relations with China present both opportunities and challenges to Sri Lanka.

The India-Sri Lanka Free Trade Agreement has been in operation for more than a decade. The paper provides the Sri Lankan perspective of the Free Trade Agreement (FTA) highlighting both the positive outcomes and the negative aspects. The paper shows that the FTA has worked in favor of Sri Lanka but its full potential has not yet been realized due to market access problems in India, and the lack of supply capacity for some products in Sri Lanka. The India-Sri Lanka Comprehensive Economic Partnership Agreement addressed many of the negative aspects of the FTA in a broader economic integration framework but was unable come into operation due to public misconceptions and lack of entrepreneurial and political leadership in Sri Lanka.

The India-Sri Lanka Free Trade Agreement (ISLFTA) shows how bilateral cooperation can lead the way for regional cooperation. In operation, it has led to the rapid growth and diversification of Sri Lanka's exports to and imports from India. India's investment in Sri Lanka has also increased; India is now the second largest investor in Sri Lanka; and service sector cooperation has followed the growth of trade and investment. There were problems along the way but they were resolved. Moreover, this economic cooperation has overshadowed whatever political problems there were in the past. Now a Comprehensive Economic Partnership Agreement is expected to come into operation by the end of December 2006. The ISLFTA dispels the myth that economic cooperation between a large and small country benefits only the large country. Dormant complementarities can be invigorated through a bilateral free trade agreement, and new comparative advantages can be discovered, further stimulating trade.

Peace can generate an economic dividend, which can be further increased by appropriate economic reform. This dividend can in turn be used to raise popular support for conflict resolution measures along the road to achieving a final political settlement, a strategy that characterizes the recent period in Sri Lanka. However, despite an increase in economic growth following the cessation of hostilities between the Liberation Tigers of Tamil Eelam (LTTE) and the government, no substantial dividend materialized for either government supporters in the South or LTTE supporters in the war-torn Northeast. The causes of this failure include delays in disbursing aid which would have eased adjustment to economic reforms—resulting in cuts to public spending that affected Southern households—and weak institutions that impeded the effective use of aid in the Northeast. The Sri Lankan experience highlights some important lessons for both government and donors on making use of an economic lever for consolidating a peace process and conflict resolution. It also highlights some of the dangers in relying too much on economic levers to consolidate a peace process when levels of mistrust are very high.