China emerges as Sri Lanka’s main import source replacing India
China has emerged as Sri Lanka’s main import source replacing India, the country’s major import origin since 2001. China became the main import origin of the island in 2016, accounting for 21.7 per cent of total expenditure on imports recording an increase by 13.6 per cent to US$ 4,215 million, Central Bank(CB) statistics showed.
The main items imported to the island during this period were textiles, machinery and equipment, building material transport equipment and chemical products.
India has been pushed to second largest import origin, accounting for 19.7 per cent of total imports, registering a decline of 10.6 per cent at $3,815 million, CB data revealed.
The reduction in imports from India was mainly due to the decline in import expenditure on petroleum products and vehicles including three wheelers and cars, a senior official of the Commerce Department told the Business Times.
According to CB data, Singapore, the third largest import origin accounted for 6.1 per cent of total imports mainly comprised petroleum products, machinery and equipment, diamonds and precious stones.
“China’s gain as the leading import nation of the country is significant at a time both countries expect to sign a Free Trade Agreement (FTA) this year, the year of celebrating the 60th anniversary of the establishment of diplomatic relations with China and the 65th anniversary of the Rubber-Rice Pact between the two countries,” the official said.
Chinese tourists are the second largest group to the South Asian country, following those from India. In the past three years, Chinese total tourist arrivals have risen by 300 per cent. Chinese tourism numbers in Sri Lanka may surpass those of India in just two years, he predicted.
The 5th round of the China-Sri Lanka FTA negotiation was held in Colombo recently, he disclosed adding that the two sides exchanged views on issues concerning trade in goods, trade in service, investment, economic and technical cooperation, rule of origin, customs procedures and trade facilitation, technical barriers to trade (TBT), and trade remedy. Positive progress has been made in those negotiations.