- Prime Minister Modi is visiting Sri Lanka to strengthen energy and defence ties, promote investments, and sign agreements in sectors like energy and healthcare.
- India plans to deepen its influence by helping build a solar power project and is discussing a potential joint oil refinery in Trincomalee.
Prime Minister Narendra Modi is visiting Sri Lanka for two days to strengthen ties in energy, defence, and investment. He will arrive on Friday evening, becoming the first global leader hosted by President Anura Kumara Dissanayake since he took office in September 2024.
India hopes to deepen its influence in the region, especially as China increases its presence in Sri Lanka through major infrastructure and energy projects. As a result, Modi’s visit holds significant political and economic weight. Sri Lanka actively seeks foreign investment to stabilise its economy after its 2022 financial crisis. During that time, India provided $4 billion in financial support, making it one of Sri Lanka’s key lenders.
India also agreed to restructure $1.36 billion in loans after Sri Lanka defaulted on its debt in May 2022. Sri Lanka’s presidential office said the visit would strengthen the historic ties between the two nations.
Both countries will sign agreements in energy, digitalisation, security, healthcare, and debt restructuring during the visit. These agreements aim to boost economic recovery and long-term cooperation.
The two leaders first met in New Delhi in December. They discussed Indian investments in Sri Lanka, energy grid connections, and the supply of liquefied natural gas (LNG). They also explored plans to create an energy and industrial hub in Trincomalee, located in eastern Sri Lanka.
President Dissanayake confirmed ongoing talks about a joint oil refinery project in Trincomalee in January. The project would focus on exports and compete with China’s $3.2 billion oil refinery in Hambantota, led by state-owned Sinopec.
India’s Indian Oil Corporation already plays a significant role in Sri Lanka’s fuel supply, ranking second to the state-owned Ceylon Petroleum Corporation.
India’s foreign ministry did not confirm whether the Trincomalee refinery would be discussed this week. Officials said Modi would attend the groundbreaking ceremony for a 120-megawatt solar power project. The project is a joint initiative between the Ceylon Electricity Board and India’s National Thermal Power Corporation (NTPC).
The two sides are also expected to finalise a defence cooperation agreement. Talks in December included plans for India to supply arms to Sri Lanka, aiming to strengthen its defence capabilities.