New Sri Lanka President’s India-China Plans

Anura Kumara Dissanayake – Sri Lanka’s new Marxist President – has said he wants to avoid being “sandwiched” between India and China but recognises each as a “valued partner”, as he tries to resolve a financial crisis that has roiled his country since 2019 and led to a sovereign default in April 2022.

The former grassroots leader made it clear he intends to steer clear of geopolitical rumblings in South Asia or the Indian Ocean region. He acknowledged that each can provide much-needed financial aid but said he also wanted closer ties with the West, the Middle East, and even Africa.

The remarks were made in an interview with The Monocle, a global affairs and lifestyle magazine, in early September (before his election win was confirmed), in which he spoke about his foreign policy.

“There are many power camps within a multipolar system… but we won’t be part of that geopolitical fight, nor will we be aligned with any party. We also don’t want to be sandwiched, especially between China and India. Both are valued friends and we expect them to become closer partners.”

Mr Dissanayake, 55, a previously fringe Left leader, was catapulted into the limelight after winning the presidential election; he pulled over 42 per cent of the votes.

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Rumoured close ties to China raised eyebrows, particularly in Delhi, which expressed concerns over Beijing’s growing influence on Sri Lanka, which sits on key shipping lanes in the Indian Ocean. Added to that, the South China Morning Post claimed Beijing expects Dissanayake will seek “maximum support” via foreign direct investment.

That report cited an economics professor from the University of Colombo as saying it is “highly probable” Mr Dissanayake would prefer to work with Beijing over Delhi.

However, Mr Dissanayake has, publicly at least, sought to reassure both Delhi and the United States, which too is wary of China’s growing influence. 

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Speaking to an Indian publication on voting day (on Saturday), Mr Dissanayake said India is “crucial” to his country’s hopes for economic stability and regional security.

“We will consider how our economic measures impact our country (while) recognising the importance of India’s support in our development efforts,” he told The Week.

Prime Minister Narendra Modi has spoken to Mr Dissanayake, stating he looks forward to working closely with him to further strengthen the Indo-Lanka multifaceted cooperation. Mr Modi’s post on X also contained a reference to Colombo’s “special place” in Delhi’s Neighbourhood First policy.

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Mr Dissanayake responded, “I share your commitment… Together, we can work towards enhancing cooperation for the benefit of our peoples and the entire region.”

The Sri Lankan leader also played down fears – expressed by both Delhi and Washington – his country would become a military base for Beijing; as recently as last month three Chinese Navy ships were berthed at Colombo Port, at the same time as India’s front-line warship, INS Mumbai, docked.

“We are committed to maintaining our sovereignty and will not become subordinate to any power in this geopolitical race…” Mr Dissanayake said this month.

Delhi has played a key role – recognised by the International Monetary Fund, which has provided a $3 billion bailout programme – in guiding Colombo through the ongoing financial crisis, having provided aid – food, medicines, fuel, etc., – worth nearly $4 billion since the storm broke.

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Mr Dissanayake, however, has said he will try to renegotiate the IMF’s loan conditions, some of which led to tax hikes and spending cuts, which many in Colombo said actually exacerbated the cost-of-living crisis that sparked the violent protests of 2019 and 2020. Reviewing the debt plan, though, risks delaying additional loans he needs to meet fiscal criteria before more funds are released.

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