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Sri Lanka

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Sri Lanka country brief

Overview

Australia and Sri Lanka share a strong relationship. A shared history of cooperation in areas such as education, trade and investment, sport, culture and development as well as our links through the Commonwealth are the foundations of the relationship. We have common interests in security and sustainable development in the Indian Ocean region.

The bilateral relationship continues to strengthen and trade and investment opportunities are growing. We engage regularly on a wide range of issues including economic and development cooperation, joint efforts against people smuggling, strong education linkages and on human rights and reconciliation.

In 2017, several high-level visits took place in celebration of the 70th Anniversary of our diplomatic relationship. Australia welcomed former Sri Lankan President Sirisena and former Prime Minister Wickremesinghe. Former Prime Minister Turnbull and former Foreign Minister Bishop travelled to Sri Lanka.

In September 2019, Australia and Sri Lanka held the third Senior Officials’ Talks in Colombo, alongside the inaugural Strategic Maritime Dialogue and the second Joint Trade and Investment Committee meeting.

Trade and Investment links

Two-way trade is growing steadily following the signing of the Australia — Sri Lanka Trade and Investment Framework Arrangement (TIFA) in 2017. The TIFA deepens economic cooperation between Australia and Sri Lanka through establishing the Joint Trade and Investment Committee (JTC). The JTC is used to strengthen our economic relationship and address market access and investment facilitation issues, making it easier for Sri Lankan and Australian businesses to trade and invest with one another.

TTwo-way goods and services trade between Australia and Sri Lanka in 2018 was $1.6 billion, with growth driven by education services and tourism. Australia’s major goods exports to Sri Lanka include passenger motor cars, vegetables, wheat and paper. Our major goods imports from Sri Lanka include tea, textile clothes, textile accessories and fixed vegetable oils and fats. Trade in services is increasing. Read the Sri Lanka country fact sheet [PDF 48 KB] for further details.

Australia’s total investment stock in Sri Lanka was $62 million in 2018 and Sri Lanka’s total investment stock in Australia was $202 million.

Commercial opportunities in Sri Lanka are growing. Sri Lanka is strategically located on major shipping routes, adjacent to India, and between China and the Middle East. It has high literacy standards, improving infrastructure, market leadership in a few core sectors and is at peace.

Some 114,000 Australians returned from Sri Lanka at year ending June 2019 ranking Sri Lanka as the 20th most popular destination for Australians. Australia has helped the Sri Lankan government deliver a national tourism development strategy. We continue to support tourism recovery and resilience in Sri Lanka since the Easter Attacks in April 2019.

Education Links

Education plays a significant role in Australia’s bilateral relationship with Sri Lanka. Many Sri Lankan students opt to study in Australia. In 2018, 11,000 Sri Lankans were studying in Australian schools while there are around 23 Australian education providers active in Sri Lanka (including one with an on-site campus).  The majority of Australian providers in Sri Lanka offer higher education courses or university preparation courses. Significant opportunities exist to increase collaboration in the technical and vocational education (TVET) sector.

Sri Lanka is participating in the New Colombo Plan (NCP). Since 2014, the new Colombo Plan has awarded 681 scholarships and mobility grants for Australian undergraduates to undertake study and work-based experiences in Sri Lanka.

Development assistance

More information on Development Assistance to Sri Lanka.

Cooperation on transnational crime

Australia and Sri Lanka cooperate closely to counter transnational crime, including people smuggling. Under the Memorandum of Understanding on People Smuggling and other Transnational Border Crime (September 2017) and Australia-Sri Lanka Memorandum of Understanding concerning Legal Cooperation against the Smuggling of Migrants (December 2009), Australia and Sri Lanka are working to strengthen people smuggling legislation, preventing criminals from exploiting gaps in legal frameworks. We are also members of the Bali Process on People Smuggling, Trafficking in Persons and Related Transnational Crime.

In the aftermath of the Easter Sunday attacks (April 2019), Australia provided practical support and solidarity to Sri Lanka. Our support included the Australian Federal Police’s assistance to Sri Lanka police investigating the attacks, including through counterterrorism investigative, intelligence and forensic resources.  

Successive Australian Governments have consistently and strongly opposed all forms of terrorism, including terrorist acts by the Liberation Tigers of Tamil Eelam (LTTE). On 21 December 2001, the Minister for Foreign Affairs listed the LTTE in accordance with Australia's obligations under United Nations Security Council Resolution (UNSCR) 1373 on the prevention and suppression of terrorist acts. The LTTE listing was most recently renewed by the Minister for Foreign Affairs in 2019. Consequently, it remains a criminal offence under Australian law to use or deal with assets owned or controlled by the LTTE, or to provide assets to the LTTE, whether directly or indirectly.

Human rights and Reconciliation

A civil conflict between the government forces and the Liberation Tigers of Tamil Eelam (LTTE) affected Sri Lanka from mid-1983 until May 2009.

The UN Office of the High Commissioner for Human Rights Investigation on Sri Lanka (OISL) report released in September 2015 found that war crimes and crimes against humanity may have been committed by both sides of the civil conflict between 2002 and 2011.

Australia has consistently urged the Sri Lankan Government to ensure that all allegations of serious international crimes committed by both sides to the civil conflict are investigated and prosecuted in a transparent and independent manner. Australia has encouraged Sri Lanka to deliver on its outstanding transitional justice agenda in a timely and effective way, including through full implementation of HRC resolution 30/1 — Promoting reconciliation, accountability and human rights in Sri Lanka. Australia remains a constructive partner in Sri Lanka’s reconciliation efforts, including through providing practice support.

Australia’s practical support includes a reconciliation package to support transitional justice and long-term reconciliation, including technical assistance through the UN to support the Office of Missing Persons and Office of Reparations. We also provide humanitarian de-mining assistance to increase access to agricultural land for mine-affected communities. Since 2009, Australia has provided more than $250 million in development assistance to reconstruction and to stimulate economic growth in the North and East.

Cooperation in regional and multilateral fora

Australia and Sri Lanka work together in a number of important regional and global fora, including participating in the Commonwealth.

Australia and Sri Lanka engage through the Indian Ocean Naval Symposium (IONS) and are active members of the Indian Ocean Rim Association (IORA). We also work together in the ASEAN Regional Forum (ARF), and other ASEAN-led architecture.

Sri Lankan community in Australia

Our people-to-people links are extensive across all sectors of society — academia, media, culture, literature, science, sport, medicine, politics, commerce and law. The Sri Lankan diaspora in Australia is now over 170,000. The large Sri Lankan community contributes significantly to strengthening Australia’s multicultural society and economy.

General information

Geography and demography

Sri Lanka (formerly Ceylon) is an island about the size of Tasmania in the Indian Ocean. It lies east of the southern tip of the Indian subcontinent, separated by the Palk Strait. The population of Sri Lanka is 21.2 million, with over 2.3 million people living in the capital city of Colombo. Major districts include Gampaha (over 2.2 million people), Kurunegala (over 1.6 million people) and Kandy (over 1.3 million people).

Sri Lanka's official languages are Sinhala and Tamil. English remains widely spoken and used in government. Major ethnic groups are Sinhalese (74 per cent) and Tamils (18 per cent). The major religions in Sri Lanka are Buddhism (69 per cent), Hinduism (15 per cent), Christianity (8 per cent) and Islam (7 per cent). The currency is the Sri Lankan Rupee.

Political overview

Political power in the Democratic Socialist Republic of Sri Lanka since independence in 1948 has alternated between two main political parties — the leftist Sri Lanka Freedom Party (SLFP) and the centre-right United National Party (UNP). The President is directly elected and is Head of State, Head of Government and Commander-in-Chief of the armed forces.

In 2015, Sri Lanka’s political landscape changed significantly with the election of a ‘national unity government’ (NUG), comprised of both main political parties, with Maithripala Sirisena as President and Ranil Wickremesinghe as Prime Minister. The NUG sought to implement a reform and reconciliation agenda which included implementing constitutional reforms and tackling government inefficiency and corruption. In April 2015, legislation was passed (19th Amendment) to amend the Constitution, including shortening the presidential term from six to five years and limiting the terms of a president to no more than two. However, the administration then stalled on further changes to the Constitution that were intended to further reduce the president’s power, strengthen the role of the Prime Minister and devolve power to the provinces.

A constitutional crisis occurred in October 2018 when then President Sirisena dismissed the Prime Minister, dissolved parliament and appointed Mahinda Rajapaksa as Prime Minister. However, on 13 December 2018, Sri Lanka’s Supreme Court ruled unanimously that the dissolution of parliament was unconstitutional and, on 16 December, Mr Wickremesinghe was reinstated as Prime Minister.

The presidential election of 16 November 2019 was won by the leader of the Sri Lanka Podujana Peramuna (SLPP) party, Mr Gotabaya Rajapaksa. On 21 November 2019, President Rajapaksa appointed his elder brother (and former President) Mahinda Rajapaksa as Prime Minister, as well as a new interim cabinet. Parliamentary elections are expected to be called in the first half of 2020.

Economic overview

Sri Lanka’s economic prospects have improved considerably since the end of the civil conflict in 2009. GDP growth climbed to an average of 5.8 per cent during the period of 2010-2017.

In 2018, Sri Lanka’s GDP per capita was US$4,067.9. Sri Lanka’s real GDP growth was 3.0 per cent higher in 2018 compared to 2017, reflecting a peace dividend and a policy thrust towards reconstruction and growth. Sri Lanka’s economy has transitioned from a previously predominantly rural-based agriculture economy towards a more urbanised economy driven by services.

Sri Lanka ranked 76th on the Human Development Index in 2018. Strong economic growth in the last decade has led to improved prosperity and a decline in absolute poverty. This is reflected in Sri Lanka’s graduation to ‘upper middle income’ country status in 2019.

Going forward, sustaining inclusive growth will require a strong focus on macroeconomic stability, deregulation, removing barriers to trade, high and sustained investment in infrastructure and human capital, and continued progress in fiscal consolidation and debt reduction.

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