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AnalysisGatewayHThursday, 3 September 2026

Striking a new bargain on India–Sri Lanka free trade

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Summary
The India–Sri Lanka Free Trade Agreement (ISFTA), implemented in 2000, has significantly expanded India–Sri Lanka trade, investment and tourism. But it now needs to be deepened beyond goods to make the most of the modern, supply-chain-driven global economy. Any ISFTA 2.0 should update rules of origin, liberalise services, digitise customs, strengthen investment protections and deepen connectivity to help Sri Lanka integrate into India-centred supply chains. The post Striking a new bargain on Ind
Key Facts
TypeAnalysis
SourceGateway House
PublishedThursday, 3 September 2026
Affected Population63 million MSMEs, export-import community
Key Numbers
Merchandise exports: $437 billion (2024-25)
FDI inflow: $71 billion (2024-25)
PLI scheme: Rs 1.97 lakh crore across 14 sectors
GDP: $3.9 trillion (2025 est.)
Key Authorities
Ministry of Commerce & IndustryDPIITDGFTMinistry of FinanceRBI
Key Stakeholders
ExportersImportersMSMEsTaxpayersBanks & NBFCsInvestors
Government Context
NDA IIIBJP-led NDA
Centre-Right
LeftCentreRight
Explore Sectors
Trade & Commerce140 tracked→Finance & Economy668 tracked→
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