Sri Lanka Wants India’s AI & IT Expertise to Rebuild Economy After 2022 Crisis

Sri Lanka is betting on a digital-first recovery—and is turning to India to help build it.

In a key diplomatic signal, President Anura Kumara Dissanayake has sought India’s support to strengthen the country’s digital and IT ecosystem, positioning technology as the centre of its economic revival.

The proposal was discussed during the visit of CP Radhakrishnan, Vice President of India, to Colombo, where both sides reviewed ongoing projects and explored new areas of cooperation.

India’s Foreign Secretary Vikram Misri, according to an ANI report, said the request was closely linked to Sri Lanka’s ambition to tap into emerging technologies following the Sri Lankan President’s recent visit to India.

“This kind of assistance… in the digital technology sector, in the IT sector, would be enormously beneficial to Sri Lanka, and it would allow the country to explore new opportunities in the booming and ever-growing digital sector,” Misri said, referring to Dissanayake’s remarks.

India has responded positively, with the Vice President indicating that the proposal would be examined by relevant authorities—signalling potential movement towards deeper digital cooperation.

Laying the Foundation for a Digital Economy

The renewed focus on technology marks a shift in how both countries view their partnership.

A key pillar under discussion is Sri Lanka’s planned Unique Digital Identity system, which officials say could serve as a foundational layer for innovation—much like India’s Aadhaar ecosystem.

Misri suggests that once such infrastructure is in place, it can unlock a wide range of applications across sectors.

“Once the basic digital backbone is established… the sky’s the limit in terms of the kinds of applications and products that Sri Lankan companies… can build,” he says.

The emphasis is not just on governance tools, but also on enabling fintech, startups, and digital services that can drive economic activity.

Indian IT Industry Signals Early Interest

This push is being complemented by growing interest from India’s IT industry.

According to a press release issued by the High Commission of India (HCI) in Sri Lanka, a delegation led by NASSCOM President Rajesh Nambiar visited Colombo in December last year to explore opportunities for collaboration with Sri Lankan firms and policymakers.

At the time, Sri Lankan Prime Minister Harini Amarasuriya had pitched the country as a natural extension for Indian tech firms.

She “encouraged them to consider Sri Lanka as a destination for their business expansion and growth”, citing strong cultural and economic linkages.

Nambiar, in turn, underscored the Indian IT industry’s willingness to support Sri Lanka’s recovery through innovation partnerships and AI skilling initiatives.

Energy & Connectivity Anchor the Partnership

While digital collaboration is gaining prominence, it sits alongside major infrastructure discussions—particularly in energy and connectivity.

Projects such as the Trincomalee energy hub and a proposed India–Sri Lanka oil pipeline were also discussed during the talks, reflecting the strategic depth of the partnership.

Misri highlights the importance of these initiatives in the current global context.

“The point was made as to the value of such energy connectivity… when the entire world… is facing the fallout of an energy crisis,” he notes.

From Aid to Architecture

The broader shift is clear: India-Sri Lanka ties are moving from crisis-driven assistance to long-term capability building.

New Delhi, which played a critical role during Sri Lanka’s 2022 economic crisis, is now positioning itself as a partner in building digital and economic infrastructure.

The proposed Economic and Technology Cooperation Agreement (ETCA) is expected to provide a framework for this transition, with technology at its core.

According to HCI Sri Lanka, the proposed ETCA between India and Sri Lanka is essentially an upgrade to their existing free trade pact, designed to deepen economic integration by expanding cooperation beyond goods into services, investment, and technology.

Unlike the earlier agreement, ETCA places strong emphasis on sectors such as IT, digital services, research, and professional mobility, while also aiming to streamline trade rules, customs procedures, and regulatory standards. It is intended to create a more integrated economic framework that boosts bilateral trade, attracts investment, and enables technology transfer, thereby making Sri Lanka more competitive in areas like digital services and innovation. 

Negotiations, which resumed in 2023 after a pause, cover a wide range of areas, including trade in services, technology cooperation, and economic facilitation. This reflects a broader shift towards a technology-led partnership model between the two countries.

Building a Cross-Border Digital Ecosystem

For Sri Lanka, aligning with India’s digital ecosystem offers a faster path to economic diversification and global integration.

For India, it reinforces its ambition to export digital public infrastructure and deepen regional influence through technology partnerships.

As Colombo looks to rebuild, the message is unmistakable: the next phase of India-Sri Lanka ties will not just be about support—it will be about shared systems, shared platforms, and shared digital growth.