Ahmedabad, Dec 29 (PTI) Sri Lanka’s High Commissioner to India Asoka Milinda Moragoda on Wednesday said dialogue with New Delhi was important for the development of trust and understanding between the two countries on the Chinese presence in the island nation.

He said the two countries are trying to develop an understanding to the extent of having “red lines that the two sides will not cross”.

China does not have any security presence in Sri Lanka, and India has never told the island nation not to accept Chinese investment, he further said.

“Of course, given the nature of the power play in this region, Chinese presence can be looked at differently. In that context, I think our dialogue with India is what is important – to build trust and to understand each other. And, maybe, have some sort of red lines which both sides will not cross,” Moragona said through video link during an interactive session organised by Gandhinagar-based Rashtriya Raksha University.

“Those understandings are what we are trying to develop. I think as long as that is there, we should be able to move forward, because nobody has told us, definitely India has not, not to accept Chinese investment. China is one of the biggest investors in the world today. But as long as the investment does not create any strategic issue in India, we should be able to entertain that investment,” he said.

The envoy said better, transparent and candid dialogue between India and Sri Lanka will create less chances of misunderstanding.

In what was seen as a big jolt to New Delhi’s investment plans in Sri Lanka, the Rajapaksa government had unilaterally reneged on a tripartite deal with India and Japan to build a strategic deep-sea container port.

Sri Lanka, which had agreed in 2019 to develop the East Container Terminal (ECT) at the Colombo port with India and Japan, scrapped the deal and termed the ECT “a wholly-owned container terminal of the Sri Lanka Ports Authority.” Colombo said it would instead develop the port’s West Container Terminal (WCT) with investment from India and Japan. Much to India’s displeasure, China in November clinched the contract to develop ECT.

Moragoda said the development of Colombo port by a Chinese company is “a commercial proposition of investment,” even as 70 per cent of the 80 per cent of cargo coming to Sri Lanka being transshipped goes to India, adding that “in the economic sense, our basic business model is supply in India through trans-shipment”.

Sri Lanka’s main focus remains on how to get its economy right, and the visit of a delegation led by its Foreign Minister Basil Rajapaksa to the Vibrant Gujarat Global Summit in January will be to facilitate Indian investments in the island nation, he said.

He said that India has a crucial role to play in helping Sri Lanka get its economy right.

Sri Lanka Finance Minister Basil Rajapaksa, in New Delhi on a two-day visit, called on Union Finance Minister Nirmala Sitharaman and Minister of External Affairs Jaishankar where they discussed the four pillars of involvement potential for India to help Sri Lanka out of its economic crisis, the fourth one related to increasing Indian investment in different sectors in Sri Lanka, Moragoda said.

“In that context, on January 9, our Finance Minister Rajapasksa will be traveling to Gujarat for the Vibrant Gujarat (Global Summit) meeting, where we are having a private sector delegation going out there as well. We will also have tourism presence from Sri Lanka. And that will be the beginning of the activation of the fourth pillar to try to encourage investment to come in,” he said in a reply to a query.

The 10th Vibrant Gujarat Global Summit will be organised between January 10-12.

In a short address to the gathering on the issue of ‘Sri Lanka-India Relations: Way Forward’, Moragoda said, as far as economic relationship is concerned, his country is looking at ways to improve connections in infrastructure-related industry, more specifically ports.

The country is also looking at the energy sector, with a focus on sustainable energy, as some of its regions has a potential to produce up to 5,000 MW of renewable energy, he said.

The two countries also have possibilities in the petroleum sector, he added.

Tourism is a sector to help the country’s economy, and Indian tourism becomes important in this context, he said.

“Pre-COVID (pandemic), India accounted for 20-25 per cent of tourists coming to Sri Lanka. India is a main market …From Sri lanka, we have pilgrims who go out to Buddhist sites, we are looking at how we can broaden that, not only focusing on Bihar, Uttar Pradesh, but also other states like Odisha…We have also been looking at Gujarat,” he said.

Moragoda also emphasized the need for people-to-people and cultural relations, because the two countries come from “the same gene pool.” The need for exchange of students between the two countries will help build confidence, he said, adding that his country was working with Kerala for such exchange programmes.

He pointed out that Sri Lankan students are the single largest recipient of scholarships from India for military training institutes.