Economists say no immediate effect on Lanka
Sri Lanka will not suffer grave economic downfall owing to the tense
situation between India and Pakistan, economists predict. However, there
may be a trickle down impact on the country if the situation continues
and will be a setback to the government’s efforts to revive trade within
“Whether this will be something more than a short-term situation or
not remains to be seen. If the issue continues the whole geo-political
uncertainty will prolong and that could have an impact on South Asian
countries in terms of not only trade but also the way portfolio
investors view the region,” Lead Economist, Frontier Research, Shiran
Fernando told the Sunday Observer.
Considering the region as a whole, it doesn’t trade as much as it
should, and the key reason is the India-Pakistan issue.
“Sri Lanka’s hopes of reviving trade within the region may face a
setback due to this. But as trading within the region is not optimal, it
won’t be major,” Fernando said. International relations Sri Lanka has
maintained with the two countries have been very independent and
moderate, says Head, Department of International Relations at the
Colombo University, Dr. Maneesha Pasqual.
“Sri Lanka has always been able to balance issues between India and
Pakistan because we’ve had close relationships in terms of proximity and
in terms of economic and cultural relationships with India whereas our
relationship with Pakistan is more on military-defence ties. But SL can
and always acted as a mediator between these two countries. This has
been our role historically and we can offer it as part of our foreign
policy to prevent it from escalating, and if it has escalated to tone it
down a little,” he said.
The indefinite postponement of the of South Asian Association for
Regional Cooperation (SAARC) is not good for the Organisation as this is
the third time the conference has been postponed.
“In terms of SAARC this is a disappointment as this shouldn’t have
been the case. Although the postponement was inevitable this is the
third time the SAARC summit has been postponed in the 30 year history of
this organization and it doesn’t look good for the organization, a this
should be the venue for discussions amongst the countries in the region
and not something to be pushed aside,” Dr. Pasqual said.