This trend continues to this day. Data released by the Central Bank of Sri Lanka in its latest annual report confirm enormous progress in optimizing bilateral trade agreements with Sri Lanka. As a result of ongoing ILFTA negotiations, Sri Lankan exports to India amounted to USD 406 million in 2015, up from $354 million the previous year. Until 2015, ILFTA exports accounted for about 63% of Sri Lanka`s total exports to India (6.1% of total exports). Exports to India also increased by 3 per cent to $643 million, up from $625 million in 2014. This was mainly fuelled by increased exports of spices, transportation and feed. Prior to the signing of the agreement, in-depth studies were conducted on how to develop an operational bilateral trade agreement between a small economy and an economic centre to achieve favourable results for both countries. The resulting ILFTA attempted to take into account the asymmetry between the two countries by enacting provisions for Special and Differential Treatment (SDT) for Sri Lanka and to successfully advance trade mobilization. Each country extended tariff concessions/preferences to all goods, with the exception of those expressly mentioned on a „negative list,“ and both parties accepted preferential treatment at 5,112 tariff lines. Both countries believe that the ETCA agreement will improve capacity building in the information technology and shipbuilding sector. According to some reports, the ETCA agreement aims to „promote cooperation in the technical fields, scientific expertise and research between institutions, to strengthen standards for goods and services in order to compete in the global market and to improve opportunities for workforce training and human resource development.“ ETCA talks have been slow because Sri Lanka has insisted on further concessions from India, as India has opposed the fact that trade agreements are based on serious and in-depth negotiations. Bilateral trade between countries amounted to $6 billion in 2015/16, compared to $7.45 billion in the previous one. Earlier this month, a document written by Samatha Mallemapati for the Indian Council on World Affairs said: „During the ETCA discussions in December 2015, Sri Lanka proposed to exclude Sri Lanka`s liberalisation of the professional labour force, with the exception of two sub-sectors, namely.
B shipbuilders and it technology professionals. And to improve access to the Indian market, the Sri Lankan side has highlighted a number of problems facing local exporters in the Indian market. India therefore takes a proactive approach to Sri Lanka`s post-war economic development and both sides aspire to mutually beneficial and long-standing bilateral relations, while leaving room for independent economic philosophies, in line with their respective development objectives. From a Sri Lankan perspective, ETCA offers an ideal opportunity to stimulate private investment and contribute to the growth of the emerging middle class. Another aspect not to be overlooked is the fact that the ETCA is likely to strengthen foreign direct investment (FI) by both individuals and private institutions, which would fill the current high savings and investment gap. At a time when Sri Lanka is under pressure to meet the IMF`s targets under the Fund`s expanded facility, an important role could be played in helping Sri Lanka achieve these goals. Economic relations between India and Sri Lanka were strong in the pre-colonial era, but these weakened during nearly five centuries of colonial rule (Portuguese, Dutch and British). Economic relations were revived to some extent after independence, but this did not matter because of the domestic policy that prevailed in both countries until the mid-1980s.