Authors : Harsh V. Pant | Aditya Gowdara Shivamurthy  Courtesy Observer Research Foundation 

Since Anura Kumara Dissanayake of the Janatha Vimukthi Peramuna (JVP) was elected as the ninth executive president of Sri Lanka, there is speculation about the new government’s foreign policy. Given the economic and geopolitical scenario, pragmatism is likely to take precedence — Sri Lanka will continue to balance between India and China. The new dispensation’s quest for good governance and reforms will also likely benefit India in the long run.

At its inception in the 1960s, the JVP was a staunchly anti-Indian organisation with its Marxist and Sinhala nationalist ideology. Fighting Indian expansionism” in South Asia was one of its core ideological themes. Its first insurrection against the Sri Lankan State in 1971 ended quickly, with India stepping in to secure the Colombo airport and conducting maritime patrols at the request of the Sri Lankan government. However, the second insurrection, between 1987-1990, became even more anti-Indian with the JVP criticising the Indo-Lanka accord that permitted the deployment of Indian Peace Keeping Forces (IPKF) in Sri Lanka.

Given the economic and geopolitical scenario, pragmatism is likely to take precedence — Sri Lanka will continue to balance between India and China.

While the JVP renounced its armed struggle and entered mainstream politics in 1994, it remained a non-traditional choice. It was during the economic crisis and the 2022 Aragalaya movement that Dissanayake emerged as a popular choice for a populace disenchanted with traditional elites. JVP’s rising popularity compelled India to enhance its engagements with the party. The unpredictability of the elections also meant that India maintained engagements with all the key contenders. Delhi invited Dissanayake on an official visit, even as external affairs minister S Jaishankar and national security advisor Ajit Doval met Sri Lankan leaders across party lines in the run-up to the elections (including the JVP).

India’s pragmatic engagement is part of its Neighbourhood First policy and Security and Growth for All in the Region (SAGAR) vision. As Sri Lanka’s geopolitical significance increases, India has pushed for connectivity to further its leverage. In fact, during the island-nation’s recent economic crisis, India stepped in to offer assistance of $4 billion. As a result, India will be managing and upgrading airports and maritime ports in Sri Lanka, developing the Trincomalee region, and investing in renewable energy projects, oil refineries, an energy grid, and a bi-directional petroleum pipeline. Multiple Indian firms have expressed interest in investing in Sri Lankan State-owned enterprises (SOEs), and India and Sri Lanka are also discussing a land bridge and the Economic and Technology Cooperation Agreement (ETCA).

On their part – the JVP understands that Cold War-era alliances and affiliations make little sense in the contemporary world order. This realisation existed even before the elections and underpinned its outreach towards India. It recognises that India’s geopolitical clout and economic growth will help the country recover and strengthen its economy. Several promises in Dissanayake’s manifesto, such as developing Sri Lanka into a maritime hub, a port and trading hub, and a regional logistics management hub, will depend on the latter’s connectivity with India. Dissanayake wants to improve tourism and information technology revenues for which India will again prove to be an important country. It is this growing importance of connectivity and economic leverage that has prompted JVP to be sensitive to India’s concerns. Its manifesto specifies that the country’s land, sea, and air spaces will not be permitted to threaten or risk the national security of any country, particularly India.

Several promises in Dissanayake’s manifesto, such as developing Sri Lanka into a maritime hub, a port and trading hub, and a regional logistics management hub, will depend on the latter’s connectivity with India.

That said, the new government will balance relations with China, too. Beijing will even attempt to enhance its relationship, leveraging the new regime’s Communist leanings. Dissanayake had visited Beijing before he visited Delhi; several high-level Chinese delegates had also visited him before the elections. As the world’s second largest economy and one of the biggest lenders to Sri Lanka, Beijing will continue to engage with the government to further its interests in the Indian Ocean. This capacity to invest and assist will continue to woo an economically recovering Sri Lanka.

But having won the election with strong rhetoric on transparency and accountability, the government’s balancing will be subject to more pressure. Dissanayake aims to promote a rigorous and transparent tender process for all foreign investments, avoid privatisation of critical SOEs, conduct detailed debt audits on foreign loans, and enact legal action against those misusing these loans. On a short-term basis, this will be challenging current Indian and Chinese competition for a stake in crucial SOEs, and their investments . The call to suspend the Adani energy project is a case in point.

However, in the longer term, scrutinising loans and the new investment conditions (if implemented) are not likely to go down well with Beijing, which has exploited systemic loopholes, promoting corruption, and opaque loans. On the contrary, this could be more beneficial for India and its like-minded partners who are genuinely interested in strengthening institutions and promoting transparency and accountability in the country’s governance.

---

This commentary originally appeared in Hindustan Times.