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Joint Press Statements

State Visit Of H.E. Mahinda Rajapaksa, President Of Sri Lanka To India, December 27-30, 2005.

1. His Excellency Mahinda Rajapaksa, President of Sri Lanka and Madam Shiranthi Rajapaksa paid a State Visit to India from December 27-30, 2005, at the invitation of the President of India, His Excellency Dr A.P.J.Abdul Kalam. The President of Sri Lanka was accompanied by Mr. Mangala Samaraweera, Minister of Foreign Affairs, Mr. A.H.M. Fowzie, Minister of Railways, Transport and Petroleum and Petroleum Resources Development, Mr. Jeyaraj Fernandopulle, Minister of Trade, Commerce, Consumer Affairs and Marketing Development, Mrs. Ferial Ashraff, Minister of Housing and Construction, Mr. R. Bogollagama, Minister of Enterprise Development and Investment Promotion, Ministers, leaders of political parties and senior officials.

2. President Rajapaksa held wide-ranging discussions with President A.P.J. Abdul Kalam, Prime Minister Dr. Manmohan Singh, Home Minister Shivraj Patil, Commerce Minister Kamal Nath and Shipping Minister T.R.Baalu, and other dignitaries.

3. Smt. Sonia Gandhi, Chairperson, UPA, called on President Rajapaksa.

4. The President also met with several senior personalities from other political parties during his stay in New Delhi.

5. It was noted with satisfaction that Indo-Lanka bilateral relations have continued to be in a state of excellence characterized by political consensus in both countries, understanding, friendship, cooperation and mutual respect and benefit. The two sides reaffirmed their resolve to further consolidate and build on this strong and dynamic relationship.

6. The discussions on international issues reflected the long-standing consonance of views between the two friendly nations. Both sides remain resolutely committed to opposing terrorism in all its forms and manifestations, while reiterating that terrorism can never be justified, either on political, or on religious, or on ideological grounds. The two sides agreed that the current global challenges require the reinvigoration of multilateralism, including through the strengthening of the UN system. In this context, Sri Lanka reiterated her position that the UN Security Council reform process should facilitate India's legitimate claim for a permanent seat in the UN Security Council and reaffirmed her support for the candidature of India as a permanent member of the UN Security Council.

7. India and Sri Lanka emphasized their commitment to work for the full realisation of the objectives identified by the 13th SAARC Summit in Dhaka last November. They were of the view that the South Asian Free Trade Agreement once operationalised should pave the way for the SAARC nations to move towards even closer economic cooperation, with the eventual goal being that of an economic union encompassing the entire region.

8. The Prime Minister of India and the President of Sri Lanka expressed satisfaction at the dynamism of the bilateral economic relationship. They noted the good progress by the two governments in building on the success of the India-Sri Lanka Free Trade Agreement by negotiating a Comprehensive Economic Partnership Agreement (CEPA). They expressed their confidence that the finalisation of CEPA, on the basis of mutual benefit for both sides, would further unleash the inherent synergies between the two countries.

9. It was noted that India has made an initial allocation of a Credit Line of US$ 100 million for the integrated development of the Colombo - Matara rail network. It was agreed at the request of the Sri Lanka side, that India would take this process forward by the extension of concessionary terms to be mutually agreed upon, for the allocated credit of US$ 100 million, and for any additional credit to be made available for the said project. A multi-disciplinary delegation from India has already visited Sri Lanka. A delegation of officials from Sri Lanka representing the Ministry of Finance and the Ministry of Railways, will visit India in turn to discuss and agree on the technical and engineering aspects of the project, and the terms and conditions of the Credit Line.

10. The two leaders welcomed the bilateral understandings being reached on identifying joint ventures for the development of the eastern Sri Lankan port city of Trincomalee, and its surrounding region. They noted the need to prepare a Master Plan for realizing, including through the building up of the necessary infrastructural support, the full economic potential held out by Trincomalee and its environs. It was agreed in this context that a coal based power project of capacity 2x250 MW will be set up in the Trincomalee region of Sri Lanka, as a joint venture between the National Thermal Power Company Ltd, a Government of India enterprise and the Ceylon Electricity Board, a Government of Sri Lanka entity. The Government of Sri Lanka will have the responsibility of facilitating and extending all necessary help in setting up this project. A detailed Memorandum of Understanding for setting up the Power Project is to be signed separately.

11. The Indian side in recognition of the high priority accorded by the President of Sri Lanka to reconstruction and development in the North and East, offered to support these efforts through technical and financial assistance. The Sri Lanka side welcomed this offer of assistance and agreed to facilitate the related initiatives. The Indian side also announced assistance in constructing a library and a stadium in Jaffna.

12. The two sides agreed that there was great potential for cooperation in the areas of agriculture, IT and renewable energy. Both sides discussed collaboration in the Information and Communication Technology (ICT) area, which would include, inter alia, institutional capacity building, training and skills development and technical assistance. In this regard, India and Sri Lanka will collaborate to set up an ICT Park in Sri Lanka.

13. The two sides reiterated their desire to accelerate their co-operation in the field of human resource development, and in the fashioning of educational policies appropriate for developing within the national workforces, the skills and capacities required by the 21st Century. Towards this end, it was agreed that the Joint Working Group under the India-Sri Lanka MOU on the Education Exchange Programme would be operationalized at the earliest possible. Several measures funded by India to enhance cooperation in the field of education and training were also agreed upon. These include the Mahatma Gandhi scholarship scheme for 100 deserving Sri Lankan students every year, the upgradation of libraries and science laboratories in the Upcountry areas, the setting up of a Chair in Contemporary Indian studies in Peradeniya University and commissioning of a field study on vocational training centers.

14. It was noted that the training of 450 Sri Lankan Policemen has already commenced in different institutions in India.

15. Sri Lanka welcomed the donation of medical equipment as Tsunami relief to the affected hospitals of Point Pedro and of Hambantota. The Indian side announced that it had initiated action to prepare a Detailed Project Report on the rehabilitation of the tsunami-damaged Base Hospital in Trincomalee. The Indian side also indicated that construction of the new 150-bed Hospital at Dickoya in the Central Province is expected to commence shortly. The Government of India further announced that it would provide equipment to set up a fully-equipped Obstetrics and Gynaecology unit in the existing hospital at Dickoya.

16. Sri Lanka expressed her appreciation for the valuable contribution by the Indian Cultural Centre in Colombo, towards continuing a level of cultural interaction worthy of the longstanding historical and civilizational links between the two nations. President Rajapaksa declared the intent of his administration to present in India during the course of next year, the rich and varied cultural heritage of Sri Lanka via a series of exhibitions and events. The Indian side welcomed this endeavour which would further spur people-to-people interaction, and also enhance intellectual and artistic exchanges. India further announced that it would hold an Exhibition of Contemporary Indian Art in Colombo during 2006.

17. Both the Heads of Government noted that a positive collaborative relationship was being established for the study and monitoring of the environmental implications of the Sethusamudram Ship Channel Project. They endorsed that the outcome of the collaboration must be to reach a common understanding as to whether there are environmental consequences and if so, the action to be taken to mitigate them. They directed towards this end, the continuation of the interaction, as and when necessary, between the concerned technical experts from both sides. They also noted that the Project would bring in its wake developmental opportunities.

18. Both sides reiterated the importance of continuing bilateral cooperation in the demarcation of the continental margins of the two countries.

19. The Indian side welcomed the proposal by Sri Lanka for economic cooperation within the Palk Bay area. India looks forward to Sri Lanka presenting her proposals in the form of a Paper, which would then be the subject of study by an India-Sri Lanka Expert Group. The report of the Expert Group could be considered during the ongoing CEPA negotiations.

20. The President of Sri Lanka and the Prime Minister of India noted that both countries have a record of unbroken commitment to the free and fair exercise of the franchise, and to democratic governance. The two sides were of the view that this common commitment, which is yet another of the many strong bonds between India and Sri Lanka, could be availed of by the establishment of India-Sri Lanka Parliamentary Friendship Associations in the national legislatures of both countries. They noted with satisfaction the formation of the Sri Lanka-India Parliamentary Friendship Association in the Sri Lankan Parliament on December 22, 2005, and the decision to form an India-Sri Lanka Parliamentary Friendship Group in the Indian Parliament. They envisaged that the Associations once established, would cooperate for the further development of democratic best practice, and for strengthening bilateral relations. They accordingly recommended that the Speakers and the Members of the Parliament of India and of the Parliament of Sri Lanka, may consider expeditiously taking the necessary steps towards this end.

21. The President of Sri Lanka briefed the Indian leadership on his approach to the peace process to achieve maximum devolution which preserves the unity and territorial integrity of Sri Lanka. The two sides agreed that an enduring solution can emerge only through internal political processes that promote consensus and reconciliation. India reiterated its support for a process of seeking a negotiated political settlement acceptable to all sections of Sri Lankan society within the framework of an undivided Sri Lanka and consistent with democracy, pluralism and respect for human rights. India continues to maintain an abiding interest in the security of Sri Lanka and remains committed to her unity, sovereignty and territorial integrity. The Indian side expressed the hope that a political settlement of the ethnic issue based on devolution, openness, transparency and inclusivity would emerge through negotiations between the parties concerned, so as to ensure a peaceful and bright future for all Sri Lankans in an undivided and democratic Sri Lanka.

22. The President of Sri Lanka apprised the Prime Minister of India of recent attacks on Sri Lankan security forces and other ceasefire violations. The two leaders deplored violations of the ceasefire, which could undermine the prospects for peace in Sri Lanka. The Indian side welcomed the Sri Lankan Government's offer for early resumption of peace talks. Both sides emphasized the need for the strict observance of the ceasefire and immediate resumption of talks aimed at strengthening the ceasefire.

23. Sri Lanka is appreciative of the Indian offer to provide intellectual and academic resources in support of the peace process. The Sri Lankan side thanked the Indian side for the presentation, during the Presidential State visit, on distribution of powers between Centre, States and local government in India.

24. The State Visit by President Rajapaksa is testimony to the excellent relations between the two countries. President Rajapaksa invited their Excellencies the President and the Prime Minister of India to visit Sri Lanka at mutually convenient times.

December 30, 2005

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December 01

Joint Press Statement, Visit of Sri Lankan Foreign Minister Mangala Samaraweera to New Delhi

The Sri Lanka Foreign Minister, Mr. Mangala Samaraweera visited New Delhi for official talks from 30 November to 1 December. He called on the Prime Minister of India Dr. Manmohan Singh and had discussions with the Minister of State for External Affairs, Mr. E Ahamed.

Minister Samaraweera apprised the Indian side of the policy the Government of President Mahinda Rajapaksa seeks to follow with regard to the peace process in Sri Lanka. He emphasized the continued commitment of the government to the maintenance of the Ceasefire, and the desire for a review of its operations, so that the implementation of the Agreement can be made more effective. The Government also extends a firm invitation to the LTTE to negotiations to discuss a political solution. President Rajapaksa views the greatest possible degree of openness, transparency and inclusivity in the peace process, as being essential for its acceptance and eventual success. Minister Samaraweera spelt out the approaches that President Rajapaksa and his administration would adopt towards this end of arriving at a broad national consensus. Parallel to this endeavour, reconstruction and development in the North and East would be accorded the highest priority.

Minister Samaraweera affirmed that the Government of Sri Lanka would, in the tradition of close dialogue between the two countries, continue to apprise the Government of India in regard to the ways and means by which the peace process could be made more effective.

Indian side thanked the Sri Lanka Foreign Minister for outlining the approach of President Rajapaksa and his administration towards the peace process. India believes that an enduring solution can only emerge essentially through internal political processes. India supports the process of seeking a negotiated settlement acceptable to all sections of Sri Lanka society within the framework of a united Sri Lanka, and consistent with democracy, pluralism and respect for human rights. India continues to maintain an abiding interest in the security of Sri Lanka and remains committed to its sovereignty and territorial integrity.

Several other matters of mutual interest, including the further strengthening of economic and commercial cooperation, were addressed during the visit of Minister Samaraweera. Both sides emphasized the need to conclude, as early as possible, the Comprehensive Economic Partnership Agreement.

Government of India reiterated to Minister Samaraweera the invitation already extended by it to President Rajapaksa to pay a State Visit to India at the earliest opportunity.

New Delhi
December 1, 2005

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June 9

Arrival statement by H.E. Mr. K. Natwar Singh, External Affairs Minister of India

Colombo 

I am delighted to visit Sri Lanka, a close and friendly neighbour, to co-Chair the India-Sri Lanka Joint Commission.

The enduring friendship between our two democracies is a major factor for peace and stability in our region.  The recent tragedy wrought by the tsunami, and our cooperation in its aftermath, has strengthened our ties further.

With my colleague and counterpart, Hon'ble Lakshman Kadirgamar, Foreign Minister of Sri Lanka, I will review the progress made since the India-Sri Lanka Joint Commission last met in October 2003.  I am eager to discuss with my Sri Lankan colleagues ways and means to advance bilateral cooperation on matters pertaining to finance, trade and investment; education and culture; science and technology, which are on the agenda.  Such cooperation is tangible evidence of India's commitment to Sri Lanka's economic development and progress, and the strengthening of the democratic and inclusive nature of Sri Lankan society.

The Government and people of India remain firmly committed in their support for efforts being made by the Government and people of Sri Lanka to consolidate the processes of peace and to promote development in their country.  India's support for an outcome that accommodates the concerns and aspirations of all the groups that constitute Sri Lanka's multi-ethnic pluralistic society, while upholding and preserving the territorial integrity and sovereignty of the country, remains undiluted.

For further details, please contact Nagma M. Mallick, Counsellor (Press, Information & Culture) at Tel : 2445858 Fax : 2446403 Email : cpic@sltnet.lk

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Joint Press Statement, Visit of Her Excellency, President Chandrika Bandaranaike Kumaratunga to India, June 2-4, 2005

1. Her Excellency, Mrs. Chandrika Bandaranaike Kumaratunga, President of Sri Lanka, paid a working visit to India from June 2-4, 2005.

2. The President of Sri Lanka held cordial, wide-ranging discussions with the Prime Minister of India, Dr. Manmohan Singh. The discussions were substantive and covered the gamut of bilateral relations between the two countries, post-tsunami reconstruction efforts in Sri Lanka, and regional and international issues.

3. The President of Sri Lanka met with Smt. Sonia Gandhi, Chairperson of the UPA. Shri P. Chidambaram, Minister of Finance, and Shri Mani Shankar Aiyar, Minister of Petroleum & Natural Gas and Minister of Panchayati Raj, called on the President of Sri Lanka.

4. The two leaders noted that the forthcoming visit of the Indian External Affairs Minister for the sixth meeting of the India-Sri Lanka Joint Commission on June 10, 2005 in Colombo will provide a further impetus to bilateral cooperation.

5. During the discussions between the President of Sri Lanka and the Prime Minister of India, both sides expressed their satisfaction with the excellent state of bilateral cooperation in diverse areas. On the subject of economic cooperation, they noted that bilateral trade recorded a volume of US$ 1.8 billion in 2004 with the trade imbalance between the two countries having narrowed significantly. Taking stock of the encouraging progress on negotiations on a Comprehensive Economic Partnership Agreement (CEPA), the two leaders directed that the negotiations on the CEPA be concluded by the end of 2005 so as to give a new thrust to overall bilateral business activity as well as to encourage investments in several areas of mutual interest and thereby strengthen the partnership in economic development between the two countries.
6. The President of Sri Lanka thanked the Prime Minister and the Government and people of India for the generous assistance sent to Sri Lanka immediately after the tsunami and for the further aid pledged. The Prime Minister of India reiterated that India remains committed to assist Sri Lanka's remarkable efforts to recover from the tragedy of the tsunami of December 2004. Indian assistance would consist of a grant of Rs. 100 crores for relief and reconstruction projects, a moratorium on debt repayments for three years, as well as the factoring of post-tsunami reconstruction priorities into existing and proposed lines of credit.

7. The President conveyed to the Prime Minister her commitment to ensure the full participation of all communities in the country to ensure the delivery of relief and reconstruction assistance to those affected by Tsunami. In this context, she apprised the Prime Minister of her efforts to establish a Post Tsunami Operational Management Structure (P-TOMS) for coordinating relief and reconstruction in areas affected by the Tsunami. The Prime Minister expressed understanding of and support for these ongoing efforts.

8. The President of Sri Lanka briefed the Prime Minister on the current status of the peace process in Sri Lanka. The Prime Minister reiterated India's support for the process of seeking a comprehensive, negotiated settlement acceptable to all communities, and reflecting the pluralistic nature of Sri Lankan society, within the framework of a united and democratic Sri Lanka.

9. They emphasized the need for the early resumption of negotiations in the peace process that will lead to a durable political solution that maintains the unity and territorial integrity of Sri Lanka, and guarantees the fundamental rights of all individuals while ensuring the safety and prosperity of the people.

10. In their discussions on the peace process, concern was expressed over ceasefire violations. Particular concern was expressed over the illegal acquisition of air capability.

11. The Prime Minister of India stated that India maintains an abiding interest in the security of Sri Lanka and remains committed to its sovereignty and territorial integrity.

12. With regard to the Sethusamudram Canal Project, it was agreed that the exchange of views between the Indian and Sri Lankan technical experts should continue. This would be with regard to environmental concerns and prospects of closer economic cooperation between the two countries in the Palk Bay area.

13. The discussions between the two leaders reflected a large measure of convergence of views between the two countries on a number of international issues, including reform of the United Nations, the elimination of terrorism, SAARC, and regional cooperation.

14. The President of Sri Lanka stated that her Government and people looked forward to the visit of the Prime Minister of India to their country at an early, mutually convenient date. The Prime Minister said that he looked forward to visiting Sri Lanka stating that he attached the highest importance to the furtherance and strengthening of India-Sri Lanka relations.

New Delhi
June 3, 2005

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India - Sri Lanka, Joint Statement

Hon. Ranil Wickremesinghe, Prime Minister of Sri Lanka, visited India from 19-21 October 2003 at the invitation of the Government of India. He was accompanied by Tyronne Fernando, Minister of Foreign Affairs; Milinda Moragoda, Minister of Economic Reforms, Science and Technology and other senior officials.

The Prime Minister of Sri Lanka held wide-ranging discussions with Prime Minister Shri Atal Bihari Vajpayee. Deputy Prime Minister and Ministers of External Affairs, Commerce & Industry, Civil Aviation and Petroleum & Natural Gas called on Prime Minister Wickremesinghe. The discussions were substantive and held in a cordial atmosphere, reflective of the close relations between the two countries.

The two Prime Ministers expressed their happiness that the Free Trade Agreement, which became operational in December 2001, had enabled bilateral trade to cross the US$ 1 billion mark in the financial year 2002-03.

A decision to go beyond the Free Trade Agreement was taken during the last visit of the Prime Minister of Sri Lanka in June 2002. An India-Sri Lanka Joint Study Group was set up to make recommendations for the establishment of a Comprehensive Economic Partnership Agreement. The Co-Chairmen of the Joint Study Group presented their recommendations to the two Prime Ministers on 20th October 2003. Expressing their satisfaction on the speed with which the Joint Study Group prepared its comprehensive report with its far-reaching recommendations, the Prime Ministers congratulated the members of the Group and directed that negotiations begin immediately, with the target of concluding the Comprehensive Economic Partnership Agreement by the end of March 2004. This would enable the two countries to reap the early benefits of freer trade in goods and services and enhanced investment and economic cooperation.
The two Prime Ministers noted the successful holding of the 5th session of the Joint Commission Meeting, co-chaired by the Foreign Ministers, in Colombo on 15th October 2003 and the signing of the Agreement to release the second tranche of US$ 30 million out of the US$ 100 million Line of Credit extended to Sri Lanka. They agreed that further Lines of Credit for infrastructure projects could be discussed.

The two Prime Ministers expressed satisfaction that existing understandings on dealing sympathetically and humanely with fishermen who stray into each other's maritime zone were working well. It was noted that a number of Indian fishermen had been released by the Sri Lankan side and several Sri Lankan vessels detained at Nagapattinam had been released for repair and escorted back to Sri Lanka. It was agreed that while it was important that the fishermen should be released early, the boats may be held till the judicial processes in the two countries are completed. The Prime Ministers agreed on the need to undertake enhanced surveillance to minimize incursions, institutionalize assistance for salvage operations of released vessels, pay attention to ecological and conservation aspects and consider licensed fishing within a bilateral Memorandum of Understanding on Fisheries.
The two Prime Ministers expressed their satisfaction at increased civil aviation links between India and Sri Lanka. They noted that Sri Lankan Airlines had increased the number of its weekly flights to Indian destinations from 29 to 44 since their last meeting. Without prejudice to already existing arrangements, India offered to Sri Lanka the facility of daily air services by its designated airlines between Colombo and the metropolitan cities of Delhi, Mumbai, Chennai, Bangalore, Hyderabad and Kolkata. In addition, unlimited access would be available for air services to and from 18 tourist destinations in India. It was agreed to do away with the existing requirement of Commercial Agreements between designated airlines of the two countries for asymmetrical operations. With a view to increasing tourist flow and connectivity, it was also decided to encourage private scheduled airlines of India, who operate only in the domestic sector at present, to extend their operations to airports in Sri Lanka. The Sri Lankan Prime Minister agreed to reciprocate in terms of the access that airlines from India could have to Sri Lankan airspace.
The Sri Lankan Prime Minister proposed commencement of a ferry service linking Colombo with Kochi (Kerala).

The Prime Ministers noted with satisfaction the significant contribution made by the India-Sri Lanka Foundation towards fostering exchanges in cultural, educational, scientific and technological areas and announced a further contribution of Rs. 1 crore each to enable the Foundation to sustain its diverse activities.

Taking note of the continuing acts of terrorism worldwide and in our region, the two Prime Ministers emphasized the need for concerted opposition to terrorism in all its forms and manifestations. They agreed that there can be no justification for terrorism, be it political, religious or ideological. They recalled the obligations devolving on States, inter alia, under Security Council Resolution 1373 and the International Convention on the Suppression of Financing of Terrorism. The Kathmandu Declaration adopted at the 11th SAARC Summit held in Kathmandu on 6 January 2002 on criminalization of financing for terrorist purposes and the need to prevent the abuse of financial systems of States was also recalled. They reaffirmed the need to finalize and adopt, at the earliest, the proposed Comprehensive Convention on Terrorism, which would send a strong signal that the international community was united and determined in its efforts to eliminate the scourge of terrorism. Furthermore, they also urged the early conclusion of the proposed Additional Protocol to the SAARC Convention on Suppression of Terrorism.

The two Prime Ministers discussed the ongoing cooperation in training and the supply of equipment to the Sri Lankan defence forces and agreed that the two sides will commence discussions with a view to concluding a defence cooperation agreement at the earliest.

The Sri Lankan Prime Minister apprised the Indian leadership of recent developments in the peace process and proposals made by his Government for the establishment of an Interim Administration. India expects that the response to the proposals made by the Sri Lankan Government in July 2003 will be reasonable and comprehensive. India supports the process of seeking a negotiated settlement acceptable to all sections of Sri Lankan society within the framework of a united Sri Lanka and consistent with democracy, pluralism and respect for individual rights. It believes that an enduring solution has to emerge purely through internal political processes.

India will maintain an abiding interest in the security of Sri Lanka and remains committed to its sovereignty and territorial integrity. India would welcome a resolution of the current impasse in the peace process and an early resumption of negotiations. Any interim arrangement should be an integral part of the final settlement and should be in the framework of the unity and territorial integrity of Sri Lanka.

New Delhi
October 21, 2003

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India - Sri Lanka, Joint Statement

Colombo-July 12, 2002

Hon. Yashwant Sinha, Minister for External Affairs, India, who is on a visit to Sri Lanka, undertaken immediately after assuming his present responsibilities, held wide-ranging discussions with the Hon. Prime Minister of Sri Lanka, H.E. Ranil Wickremesinghe, on July 11 evening, and with the Hon. Tyronne Fernando, Foreign Minister, this morning. The talks were held in the cordial and friendly spirit that characterizes the close relations between the two countries.

The Sri Lankan side informed the visiting Minister of the current status of the process to initiate talks to end the ethnic conflict in Sri Lanka. The Hon. Yashwant Sinha reiterated India's commitment to the unity, sovereignty and territorial integrity of Sri Lanka and to the restoration of a lasting peace through a peaceful, negotiated settlement that meets the just aspirations of all elements of Sri Lankan society. He reaffirmed India's full support to the measures taken by the Sri Lanka Government to take the peace process forward. 

The two sides reiterated that global terrorism is a threat to international peace and security, and cannot be justified on any grounds whether political, ethnic, religious, social or economic. They stressed that this evil phenomenon must be combated unequivocally, and expressed their commitment to support all global initiatives to eradicate this menace.

The Foreign Ministers talks noted with satisfaction the momentum in the economic relationship between the two countries. They acknowledged the progress made in the expeditious resolution of outstanding issues relating to tea, garments and cement under the Free Trade Agreement (FTA) at the recent meeting of senior officials held in Colombo, July 4-5, 2002. The two sides shared the vision about the vast potential that exists for enlarging our economic co-operation beyond the FTA.

Both sides noted with satisfaction the recent signing of Agreements providing for concessional terms for the US$31 million supply of wheat by India to Sri Lanka and a Programme Loan of US$ 20 million provided by India for facilitating the economic stabilization of Sri Lanka, as part of the programme negotiated under the Standby Agreement with the International Monetary Fund in April 2001. India has had extensive involvement with the railway sector in Sri Lanka and currently Sri Lanka has sought Indian assistance for restructuring in the railway sector.

India's acceptance of a further softening of terms of the Line of Credit of US$100 million already extended to Sri Lanka had been conveyed to the Prime Minister of Sri Lanka by the then Finance Minister of India (the present Minister for External Affairs) on June 10, 2002 in New Delhi. This relaxation was to have applied to the second and third tranches, the concessional terms being a 15-year repayment period, with a 5-year grace period. It was agreed today that the relaxation would be applied to the unutilized balance of the first tranche also. 

Both sides expressed satisfaction over the imminent commencement of flights to Bangalore by Sri Lankan Airlines, and stressed the need for further enhancing air links in the context of growing economic ties.

The Sri Lankan side expressed appreciation to the Government of India for its contribution of US$ 7.5 million to the Government of Sri Lanka for setting up an Indian Cancer Centre in Colombo, to work out the modalities for which a team would visit India shortly. 

Hon Yashwant Sinha would be meeting the President of Sri Lanka and senior Ministers and other dignitaries, during the course of the day. 

The interactions reflect the high priority attached by both countries to the maintenance of close and friendly ties based on mutual trust and understanding.

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