Lankan Economists And Indian Traders Stress Benefits Of Indo-Lanka Land Bridge


(MENAFN- NewsIn) By K/Daily News

Colombo, February 13: In his speech at the seventh Indian Ocean conference (IOC) in Perth, Australia on February 10, Sri Lankan President Ranil Wickremesinghe reiterated the plan to build a land bridge between Sri Lanka and India to boost trade and economic integration between the two countries.

He had proposed a bridge across the Palk Strait when he was Prime Minister between 2002 and 2004 and named it the“Hanuman Bridge”. Since then, Wickremesinghe has been advocating economic links between Sri Lanka and the South Indian States particularly, because these are not only nearer Sri Lanka but are growth centres in India.

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He would highlight the fact that, collectively, the four South Indian States of Tamil Nadu, Kerala, Karnataka and Andhra Pradesh have a GDP of US$ 500 billion. Sri Lanka could link up with these growing regional economies.

However, despite the favourable conclusion of a feasibility study on a land bridge in the early 2000s, the idea fell by the way side due to political opposition in Sri Lanka and Tamil Nadu.

When Wickremesinghe was on visit to India in Jul 2023, he again proposed a land connection between India and the ports of Colombo and Trincomalee. The Indian Prime Minister Narendra Modi endorsed the idea and the two countries decided to conduct a feasibility study at an early date, the Vision Statement issued in New Delhi said.

“Since then, there have been several indications that both countries are keen to go ahead with the project. Such a bridge will facilitate trade and people-to-people contact,” Wickremesinghe said at the Perth conference which was organized by the India Foundation in collaboration with India's Ministry of External Affairs and the Australian Government, with support from the S. Rajaratnam School of International Studies, Singapore, and the Perth-US Asia Centre.

Land connectivity will help India's Southern States as well ports on India's Eastern seaboard like Vishakhapatnam, Kolkata and Chennai. Ships from these ports now have to go around Sri Lanka to reach Colombo, the only major commercial port in Sri Lanka. But if a land link is established with a bridge across the Palk Strait, traders can use road/and rail transport which are cheaper and less time-consuming.

In 2002-2004 Sri Lanka envisaged a four-lane highway with a parallel single rail track that was estimated to cost US$ 1 billion. The Sri Lanka Institution of Engineers and the Indian Institution of Engineers (Tamil Nadu Centre) prepared a Concept Paper which supported the plan. But as stated earlier, it did not get political support from both the Tamil Nadu and the Sri Lankan side.

In June 2015, the Indian Road Transport Minister Nitin Gadkari proposed building the 23 km bridge with ADB assistance of US$ 2.8 billion as part of the Asian highways project. But Wickremesinghe, who was Prime Minister then, was non-committal. Vasudeva Nanayakkara, a leftist politician, said that if the bridge was built the 60 million Tamils from Tamil Nadu would swamp Lanka.

However, Wickremesinghe now feels that the political climate in Sri Lanka is conducive for closer ties with India, given the significant role India has played in rescuing Sri Lanka from an economic abyss. Till now, no voices have been raised against the proposed 'land link'.

Support of Experts

Wickremesinghe's plan has the support from Lankan development experts Gayasha Samarakoon, Muttukrishna Sarvananthan and Prof. Rohan Samarajiva. Samarakoon and Sarvananthan said in a paper published by Routledge, that a land bridge would bring down the transport cost in India-Sri Lanka trade by 50%.

It will also save on time. According to them, the 23 km bridge could be traversed in less than an hour. And from the arrival point at Talaimannar, it would take another 7–8 hours to reach Colombo by road (roughly 367 km). The total travel time between India and Colombo would be 9 hours with a few more hours to accommodate Customs requirements.

They further said the waiting time for Customs clearance and other formalities could also be significantly reduced if the land route was used because the land route would involve only exports/imports to/from India, whereas the Colombo Harbour would be handling trade to and from all over the world.

Lower transport costs would bring down prices of goods in Sri Lanka. An uptick in trade would also create thousands of direct and indirect jobs. The road link with Colombo and Trincomalee would also contribute to the economic development of backward provinces like the Northern Province, the North Central Province and the Eastern Province.

“The business communities in the Northern and North Central Provinces have long complained about their inability to directly engage in international trade. Presently, businesspersons in the Northern and North Central Provinces can engage in export/ import trade only through exporters/importers in Colombo. The proposed bridge would boost direct international trade between the Northern, North-Central, and Eastern regions of Sri Lanka and India, particularly Southern India,” Samarakoon and Sarvananthan said.

Presently, only a small fraction of Indian tourists visits the Northern, North Central, and Eastern Provinces of Sri Lanka due to the long distance from Colombo, where the only international airport is located. The proposed bridge would boost tourist traffic to these marginalised provinces.

However, the successful realization of this grand vision necessitates concerted efforts to enhance the domestic road networks in Sri Lanka, the authors emphasised. There is a crying need to develop the coastal route from Talaimannar to Colombo through the Wilpattu wildlife sanctuary.

Writing in DailyFT, Rohan Samarajiva ,the founding Chair and CEO of LIRNEasia, an ICT policy and regulation think tank in Colombo, pointed out that Global Production Networks (GPNs) have become increasingly significant in world trade, encompassing developing as well as developed economies. The process of producing goods (and services), from raw materials to finished products is increasingly carried out wherever the necessary skills and materials are available at competitive cost and quality. Sri Lanka should join such networks through Indian hubs. Sri Lankan firms could join the auto agglomerate, electronic components or iPhone industry in Chennai.

Lower transport costs and the time factor that are associated with proximity are a strong influence especially for trade. The fact that this has not happened so far suggests that there may be merit in looking at ways to reduce transportation costs through a bridge connecting Talaimannar and Rameswaram, Samarajiva said.

However, a road link with India to tie up with industries in Tamil Nadu will require the development of the Northern and North Western provinces, he added.

“If Sri Lanka is to fully realise the benefits of integration with automotive, electronic or other supply chains, it may be necessary to create export processing zones with good access to the bridge in the Northern and North Central Provinces. Such zones require access to pools of human resources and the amenities to support the workers and their families,” he said. All this will lead to the development of these areas.

Traders' Voice

Representatives of Indian companies who exhibited their products at the Jaffna International Trade Fair in January 2017 were unanimously of the view that for the development and trade and investment between India and the Northern Province of Sri Lanka, the construction of a road linking Rameswaram in Tamil Nadu with Thalaiamannar in North Sri Lanka is a must.

“Having to land our goods at Colombo in the south, we take another eight hours to reach Jaffna in the far North. The long journey puts investors and traders off. It will help if we are able to go by road from Rameswaram to Thalaimannar across Palk Strait and thence to Jaffna,” explained Amandeep Azad of Azad Engineering Company based in Ghaziabad near Delhi.

“The other advantage in having a direct road link with India is that it will eliminate the Colombo-based middle men. This will bring down prices in the Jaffna market,” Azad added.

According to Jaffna trade sources, more than 40% of the goods sold in the Jaffna market are from South India. These will be cheaper of there is a road link, they said.

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