On the occasion of the 64th Independence Day of India, I extend my greetings and best wishes to my fellow citizens of India and to the people and the Government of the Democratic Socialist Republic of Sri Lanka.

During the past year, India has reiterated its position as a responsible member of the comity of nations. In the troubled world that we live in, there is now widespread respect for India’s role as a force of moderation, reason and stability. The vibrancy of our democracy, our commitment to pluralism and secularism and the strength of our economy are acknowledged by the international community. India displayed remarkable resilience in dealing with the fallout of the global economic crisis. Our leadership was able to fashion a set of policy responses and interventions whose effectiveness has been praised by the world. In the current fiscal year, we are confident of achieving a growth rate of 8.5 per cent or more, returning to pre-crisis levels of growth. This will enable the Government to continue to devote significant resources for infrastructure and social sector spending, including rural and agricultural development, healthcare and education.

Our relationships with neighbouring countries are a matter of high priority for us. With Sri Lanka in particular, India is linked by civilizational ties of history, language, culture, religion and trade. Anchored in extensive people-to-people exchanges, our relationship has matured and diversified with the passage of time, encompassing all areas of contemporary relevance, including trade and investment, development cooperation, science and technology, culture and education. India’s relationship with Sri Lanka has always been a special category in our foreign policy. As friends, both countries have helped each other in times of need, whether due to natural disasters or conflict. The true quality of friendship was evident during the recent difficult times when India stood steadfast by Sri Lanka’s side.

Today, more than a full year after the conclusion of armed conflict in Sri Lanka and with strong economic recovery on the horizon, our two countries have an excellent opportunity to realize the full potential of bilateral relations. India’s growth trajectory, population and consumer base is an opportunity and a market for goods and services throughout the world, including Sri Lanka, which can take full advantage of its strategic location next to a market of a billion consumers and be a preferred partner for India in the quest for shared prosperity.

We have already seen how Sri Lanka has been able to develop Colombo Port as a shipping hub taking advantage of the transhipment business from India. Bilateral trade between India and Sri Lanka has increased by six times in the last ten years; there are positive signs of a robust recovery in two-way exchange of goods in 2010 after the temporary decline in 2009 owing to the global economic crisis. Tourist arrivals from India are increasing rapidly. Several Sri Lankan private sector companies have invested profitably in India, Indian companies are expanding their presence in Sri Lanka, and there is every reason for our economic partnership to be further enhanced. The India-Sri Lanka Free Trade Agreement has yielded positive dividends over the past decade, and we are now discussing how to put in place a more comprehensive framework for economic cooperation.

The landmark State visit of H. E. Mahinda Rajapaksa, President of Sri Lanka, to India in June 2010 has given a marked fillip to the dynamic and multifaceted partnership between India and Sri Lanka. The visit set out a forward-looking and comprehensive agenda for bilateral engagement, which is amply reflected in the Joint Declaration released on the occasion of the visit.

Following the visit, India and Sri Lanka have engaged in discussions to finalize agreements related to the utilization of nearly US $800 million in lines of credit offered by India for railway projects in Northern Sri Lanka. Discussions are also about to be concluded on the setting up of an NTPC-CEB Joint Venture for a 500 MW thermal power plant at Trincomalee, utilizing a line of credit of US $200 million extended by India. An agreement to conduct a feasibility study for the inter-connection of the Indian and Sri Lankan electricity grids has already been signed and work on the study has started. Both countries have decided to resume the ferry services between Colombo and Tuticorin and between Talaimannar and Rameswaram in keeping with the desire to restore the traditional connectivity between the two countries. We have also launched the India-Sri Lanka Knowledge Initiative. I have no doubt that, together with the expected establishment of Consulates General of India in Jaffna and Hambantota, these developments will reinforce mutually beneficial linkages between the two countries.

India has always been committed to the unity, sovereignty and territorial integrity of Sri Lanka and to the restoration of lasting peace through reconciliation. It is our hope that the vision and leadership that resulted in an end to armed conflict will now be employed in the quest for a genuine political process resulting in national reconciliation among all the communities of Sri Lanka. The recent elections enabled the people to elect their representatives and it is now up to the latter to engage in result-oriented dialogue that treats all parties as equal stakeholders. India believes that there is today a historic opportunity for the people and leadership of Sri Lanka to address all outstanding issues in a spirit of understanding and mutual accommodation. We will continue to support Sri Lanka’s commitment to heal the wounds of the past and to build a caring society which ensures a life of equality and dignity to all its citizens.

An important building block for this process is the rehabilitation of the devastated livelihoods of internally displaced people in conflict-affected areas. India has contributed and will continue to contribute to the humanitarian relief, rehabilitation and resettlement of internally displaced persons in Sri Lanka. Our assistance package of 5 billion (USD 110 million approx) for immediate relief, resettlement and reconstruction is already under implementation and we will continue to engage with the Government in fulfilling the needs of those affected by the conflict. A major initiative to undertake construction of 50,000 houses for IDPs in Northern, Eastern and Central Provinces of Sri Lanka is now on the drawing board. The outlay for this project is estimated to be in excess of 10 billion (USD 220 million), which will be funded by the Government of India. India will also be taking up several infrastructure and developmental projects in Sri Lanka, including rebuilding of railway infrastructure, rehabilitation of Kankesanthurai harbour and Palaly Airport, construction of a cultural centre in Jaffna and several vocational training centres, renovation of the Duraiappah stadium, rehabilitation of war widows, etc.

In conclusion, I would like to reiterate that our historic and strong friendship with Sri Lanka would continue to serve as keystone for an increasingly close and mutually beneficial partnership in the years ahead.