charindra chandrasena 00:06 Hello, Dananath. Hi, Dhananath Fernando 00:07 Chari. charindra chandrasena 00:07 Hi, Riyadh. Speaker 1 00:08 Hi, Chari. charindra chandrasena 00:09 Today, have you been to India? How many times have you been to India? Speaker 1 00:14 Few times. charindra chandrasena 00:16 Few times. Couple of Speaker 1 00:16 times. Yeah. Couple of times. Dhananath Fernando 00:18 Five, six times. charindra chandrasena 00:19 Five, six times. I think I'm me also about three times. Speaker 1 00:23 Oh yeah, I think I'm about the same year. charindra chandrasena 00:25 Yeah, Speaker 1 00:25 three or four times. charindra chandrasena 00:26 Yeah, we travel there a lot. Speaker 1 00:29 Yeah. charindra chandrasena 00:30 The thing I want to touch on today, and I want to get to it without you know spending too much time with the background because we just had a forum called India Calling last week, and Dana, you know about this a lot because you were a part of the part of one of the panels. We also had the Indian Foreign Foreign Ministry Secretary coming here, and he met everybody from the president downwards, and we also happen to have the Indian national cricket team in Sri Lanka. Yeah, and and an important Test series is beginning on the weekend. Speaker 1 01:20 Yes, charindra chandrasena 01:20 so I thought it was opportune for us to talk about India, not about India, but about India in relation to Sri Lanka. Speaker 1 01:31 Yeah. charindra chandrasena 01:32 Now, India, for as long as I can remember, we have been talking about our relationship with India, and somebody in the previous generation would also say, for as long as they can remember, we've been talking about our relationship with India. Now, obviously, we are going to focus on the economic relationship. At the moment, the general sentiment is that we are not capitalising enough on having India next door, Dhananath Fernando 02:06 mainly in the economic front. charindra chandrasena 02:08 No, mainly on the economic front. I think culturally, I think there is a lot of collaboration, and and socially, whether whether it is government initiated or not, those things happen. From from from simple things like how our weddings are done now, you know, there were Sri Lankan style of wedding, and then those weddings have got Indianized. Correct. Yeah. How how we how Sri Lankans used to worship, you know. There was a time when there were two hands, and then it became just touching the the feet with one hand in the Indian side and doing that, so a lot of cultural exchange, a lot of social, you know, transfer. Economically, one thing that the foreign secretary mentioned when he came and met the government was about the the projects that have been stalled in the Indian funded projects or stalled or not moving fast enough. Secondly, about the freighter freighter agreement. Now that freighter agreement was actually signed and correct me if I'm wrong, Dana, in 1998, but it was operationalized. If I remember correctly, again 2000. So we are 201 maybe, but we are about 25 years, give or take, from that FTA. If we make that the starting point, is this a successful FTA because it was the first FTA signed by Sri Lanka? Dhananath Fernando 03:45 Yeah. charindra chandrasena 03:46 Blunt assessment: Is it a successful FTA or no? Dhananath Fernando 03:49 It is. In my view, it is a successful FTA. Mainly looking at the numbers. If you look at the, this is not a good way to also analyse imports and export versus a particular country. For an example, if the that's what the U.S. did know, they analysed the trade deficit between countries and they slashed a tariff. So it is not a good way to compare. This is this charindra chandrasena 04:14 is Trumpian mathematics. This is Trumpian mathematics and Trumpian Dhananath Fernando 04:17 trade. But even if you look at in that lens, on the free trade agreement. Actually, Sri Lanka have a trade surplus. Don't get me wrong. This is under the free trade agreement. What we export to India under the free trade agreement is larger than what we import from India under the trade agreement. But overall, we import more outside the free trade agreement. We import more than what we export, Speaker 1 04:45 and especially food. I mean, yeah, and Dhananath Fernando 04:47 that is also normal because normal in the sense because what we import export beyond the free trade agreement is anyway other countries can also competing in the same tariff line. No, so likely in. India may be importing, exporting it because of the advantage that they have. So we are importing more even at a higher tariff rate. So it's basically it's clear you have a if you look at trade even after the free trade agreement we had an advantageous position. So on that basis, that's just like one indicator. But why it is good is very interestingly now everyone knows India signed so many free trade agreements, like you know, with European Union, with UK. They basically signing free trade agreement left, right, and centre. Sri Lanka-India free trade agreement is very interestingly India's very first trade agreement. So as for Sri Lanka, not charindra chandrasena 05:41 just Sri Lanka, India is also India's Dhananath Fernando 05:43 also the very first part. It charindra chandrasena 05:44 it makes sense though because they opened up the economy after us. Absolutely. So we opened in 1977. They opened in 1991. Dhananath Fernando 05:53 Correct. charindra chandrasena 05:54 And both were after a crisis. Dhananath Fernando 05:56 Absolutely. So charindra chandrasena 05:58 so that seems to be the catalyst. Dhananath Fernando 05:59 Correct charindra chandrasena 06:00 for opening up an economy, yeah. When when you when you hit rock bottom, Dhananath Fernando 06:04 absolutely. So in that sense, also it's kind of iconic and use. I mean, I mean it's important. But now, if you go to but because it's because this trade negotiation, free trade agreement is a separate art and a science. Now, if you compare where Sri Lanka is and where India is, we are completely like worlds apart. charindra chandrasena 06:27 Yeah, Dhananath Fernando 06:27 because they have because they have been constantly signing free trade agreements. They are in terms of negotiation and all that. They are very strong because they have been in this game for too long, and they have tacit knowledge on how to do the negotiations, how to draft trade agreements, all that because they have signed agreements with European Union and all that, which is very complicated in nature. We have only signed very few. That's also very ad hoc. Like you know, you have some volunteer, not volunteers, but you really don't you really build it as an institution on this trade agreement. So that's why I see it's the right thing, but we really didn't capitalise or we really didn't take it forward from there. Yeah. So, so my charindra chandrasena 07:05 point is, if you say it was successful and it is good, why are so few Sri Lankan products having an influential position in the Indian market? So, one you can mention is maybe Dumro. Dhananath Fernando 07:20 Yeah, charindra chandrasena 07:20 because Damro is in multiple states and it keeps expanding. I don't know about the market share though, but I think they are doing pretty decently. Then maybe you can take confectionary brands. You can take certain exceptional brands. The thing Speaker 1 07:37 is, you get a few ceramic producers that who are there, charindra chandrasena 07:41 but overall, have has the free trade agreement really opened up the Indian market to Sri Lankan brands? Dhananath Fernando 07:50 Yeah, sorry, yeah, you were not. No, so I so so Speaker 1 07:54 what Dana said was for me. I have a slightly different kind of twist on this. I mean, opinion on this. So, for me, the problem is one thing is why we missed out. Okay, we had the free trade agreement, and see, Sri Lanka is one is has a unique position in South Asia, right? The largest populace in the world is in our region, right? And because all the countries have big populations, right? I mean, apart from Maldives, Bhutan, and Sri Lanka, all the countries are like you know. So one thing is, all those countries also have problems with each other. The Bangladeshis have a problem with Indians. Bangladeshis have a problem with Pakistan. Pakistan has a problem with Bangladesh. Pakistan has a problem with India. So so and so forth, right? We are the guys that, but we normally talk in our language, shape again, right? So I think using the free trade agreements, we have a natural leveraged on that, and we have not used it as a catalyst to push certain parts of industry that we have here. Now, for example, if we had got used that and integrated into now, see the world runs on supply chains by the Sri Lankan apparel sector, even though they are having problems and all that, they are integrated properly into the world supply chain, and and you can't just remove one person overnight and give it to another person because the whole supply chain works like that. We haven't kind of got into the whole supply chain of the region and not got into the supply chain of India, because India is the India is the big Kahuna in this region. Okay. So if we had like industries work with, it doesn't even have to be India as a country as a whole. Can be even a province where they have things that we might be able to collaborate. That is one thing I think we have missed out on, and this is something I always tell is for examples Sri Lanka. We have a relatively advanced rubber sector, right? Because we have some international companies working. Because rubber is one thing is you need the you need the material which Sri Lanka has, right? That is the natural rubber, and then you need the technology. The technology also the transfer has already happened. No, now for example, we have lodestar, right? So raga. Rubber works specifically on the compound, right? It's the compound that differs from product to product. So that knowledge we already have, but we have not integrated with any other country into their supply chain where we produce particular heavy industrial tires and maybe aviation tires, and that's Dhananath Fernando 10:18 it. Speaker 1 10:18 So if we had integrated and expanded that this thing, and not only at large scale, even at medium notary. Lanka has a lot of medium scale what you call rubber manufacturing company. If those companies that like integrated or got into some kind of a partnership with a Indian company to give to, and and India is a massive, you know, 1.3 billion population, massive market itself, and plus India also exports. Now India is a India is going to be a huge car exporter, right? I mean, it's not only domestic; they are going international, right? So, if they had integrated into that, then there would have been lot of synergies where Sri Lankan economy would have greatly benefited. So, you are saying Sri Lanka should have integrated into charindra chandrasena 11:00 the Indian supply chain. Yeah, in Speaker 1 11:02 Indian supply chain because the Indian charindra chandrasena 11:03 origin supply chain. Yeah, so Speaker 1 11:04 the thing is, sorry, everyone thinks when you are integrating, you don't have to make a finished product. You make a component that will go into now. For example, you take the Airbus. charindra chandrasena 11:14 Yeah, Speaker 1 11:14 Airbus is manufactured in like someone know. I mean, parts come from Germany, the UK comes from France. Then you get parts that come from Italy, right? Yeah. You get parts that come from Spain. charindra chandrasena 11:25 Yes. So Speaker 1 11:26 yeah, charindra chandrasena 11:26 understood. So, but what you're saying is now the global value chains that Sri Lanka has to jack into. Yeah. That story is well known. Yeah. But you're saying that those global value chains, the ones that originate from or the ones that are based in India, meaning where the assembly is done in India, is what we should jack into. Speaker 1 11:48 Yeah, so the thing is we can be a component supplier. Yeah. Now the thing is in Sri Lanka the mentality is everything is no. We have to sell a finished product. You don't have to sell a finished product. You sell a component. Specialise in that. Specialise in now, for example, specialising one one particular part, right? And that's how if you take Airbus also, the engines come from Rolls Royce because Rolls Royce is specialising on that, right? Maybe certain part of avionics will probably come from Italy, right? From Italy, like like from Leonardo or something like that, right? And then certain parts will come from from France, yeah, right. So yeah, charindra chandrasena 12:24 yeah. But but Riyad, my question is, what you're mentioning is different to maybe the Damro model, where they are physically present in India, Speaker 1 12:34 yeah, charindra chandrasena 12:34 and they they manufacture there and then they sell to the Indian market. Speaker 1 12:39 No, I'm just saying, Chari. Like charindra chandrasena 12:41 what you're saying is, become a part of the value chain because without thinking in that, I mean, camera model. If you can do it, fine. But otherwise, think about it in that component. So Speaker 1 12:50 I'm just saying. I mean, just just without going too further. And what I'm saying is, right? It's easier to sell one component than selling the whole product. Yeah, yeah. Clarify charindra chandrasena 12:59 if that's what you mean. Yeah. Speaker 1 13:00 So I think that is the model we need to look because because the thing is, if you get to India, there are too many barriers for a finished product. But if you are sending a component, it'll be much easier. Right. Understood. Very clear. Okay. charindra chandrasena 13:11 So Dana, firstly, do you agree with that? And secondly, are we approaching India in the wrong way, in the sense, are we thinking of India as a whole country, or should we start? There's this famous story of this king who lost a war, and then he went into hiding, and then while he was eating the food, he was eating from all over, and then he was taught to you know start from one place and okay okay yeah so like that should we start from one area somewhere maybe in the southern part and then try to penetrate into the larger country Dhananath Fernando 13:52 no absolutely I think that's one way to look at it I think probably that's the approach but on your initial question like if if the if the trade agreement has worked on based on my initial remarks, why we really haven't penetrated? Largely, I think I agree with Riyadh that we really haven't got into the components. The other reason is actually the absence of a comprehensive trade agreement. What we have is a free trade agreement. What we need is a more comprehensive services. I think there are technical terms called mood, food, and all that, where you open up for services and other sectors as well. But having said that, also let's not like fool ourselves. Like there are also still barriers from Indian, you know, between the trade, also from the India's point of view at the same time, because API is charindra chandrasena 14:41 actually one of the largest. I mean, sorry, one of the most difficult large economies to get into. Absolutely. So there Dhananath Fernando 14:47 are trade, but I think the classic case. I think all the apparel, this JAF and apparel industry is basically lobbying for. There is a restriction on apparel exports to the Indian market. There is an 8 million piece. So, for an example, if it's socks, one sock count as one. So that means like you can only export to India with this tariff. Only Speaker 1 15:10 4 million. Only 4 million pairs of shoes, Dhananath Fernando 15:12 right? Socks. So likewise, there are trade barriers from the India's point of view as well, and in terms of certification, in terms of quality assurance, there are barriers on that front as well. So that's why actually it's need to make it more comprehensive, a comprehensive trade agreement. That's one way to look at it. Yes, second one, but you mentioned whether we are approaching it in the wrong way. Yes, because people think when you India, India is like this all massive giant market. But I think India is about India. It's charindra chandrasena 15:43 about five countries. No, more than Dhananath Fernando 15:45 that. Even more than that. It's like each. Yeah. Sorry. If you charindra chandrasena 15:48 take the regions, even it's about five countries in five countries. So Dhananath Fernando 15:52 diverse. Yeah. What I found very interesting was I was there at this conference, and again, this is not a paid one or anything. Sorry. This is just the genuine opinion, and if you really want to pay us, just become an Advocata inside. It's just 12,000 rupees a year, 1000 rupees a month. So charindra chandrasena 16:09 just just for just for as a disclaimer, you were not part of the organising committee of this. No, no, I just moderated Dhananath Fernando 16:14 one of the sessions. Exactly. And there's no. I I wish they paid me. Yeah. They they did not. And also, we have different views also on certain projects. So, so, so that's perfectly fine. But definitely, we have to connect with India. That's a separate story. But what I've been saying is, yes, one is India is not like one unit. There are multiple countries. You have to approach differently, and there are companies who have done it successfully. Not only the companies, there are artists who have done it successfully. What I got surprised was Sankadinet was there in one panel, so he was one guy actually who had tapped the Indian market well. So he's again, please I beg your pardon on my music knowledge. No, no. So, so charindra chandrasena 17:02 he he brought Udit Narayan's son. Dhananath Fernando 17:06 Correct. Adithy Nara. Aditya Narayan charindra chandrasena 17:09 to Sri Lanka. Udit Narayan, the famous playback singer from the 90s. He he brought him to Sri Lanka, and they had a joint concert. Dhananath Fernando 17:16 Correct. charindra chandrasena 17:17 Right. Now that doesn't happen too often with a with a guy of the calibre of Aditya Narayan, Dhananath Fernando 17:24 correct. So that's what exactly. So I was there in that panel. Panel in the sense I was at the audience listening to him. He said, "Look, I was the I did not approach Udit Narayan. They approached me, and then I he said now he is going to Japan with Adity Tenara, he said, "I am the one who is taking him, not he is asking me to come. So I have through India, it's not India, I have tapped into a global market of music. But he said something very interesting. He said, "So then I think there was a question from the audience that how to actually crack the global market. He said, "You crack it through your originality and locality. You know what I bring is like the authentic Sri Lankan music, maybe with a I don't know the Indian you know flavour to it, with the Indian vibe. Let's say Indian vibe for it, but that's the way to go to go global. I mean, you can't really go and you know bring something different. But with that, he said, "I have become. He has done according to Sankadine. He has done well. In fact, he said something very interesting. He said, "In fact, he reached out to. Again, I am very sorry about my music knowledge. Celine Dion, Celine Dion, right? Celine Dion, right? Yeah, international star. International star, and he said he's quite fingers crossed. She has indicated kind of interest. Really? Yeah. So this is like if he said actually just the fact that that discussion has happened exactly. He said at least she knows that there was a guy who is willing to work. So don't know whether it will be material or not. Maybe you can watch the recording, kind of. That's what he said. So that is so. He, I think, hasn't approached how he has even like a industry like music. He has kind of got into it. So I think that's where we also have to look at it. India is not a single market. It's like different paths, and even like a small state can be the entry point. I think that's what even the Sri Lankan companies who expanded to India, like the Brandixes, the MSs, they also in Visaka Patnam. So they basically went selected an area where they created jobs and they brought the production costs down and things like that. So I think those are the ways that we have to look at it. But I think we have to move for a comprehensive trade agreement, but I have a different study, but I'll take it up later. charindra chandrasena 19:44 Okay, remind me if I don't ask a pointed question on that. But basically, what I feel is now Prime Minister Modi, despite what happened a couple of months ago or a month ago with this cockroach protest. And all of that, he is at least until 2029 the Prime Minister of India. Dhananath Fernando 20:06 Yeah, charindra chandrasena 20:07 maybe even beyond. Speaker 1 20:08 Yeah, charindra chandrasena 20:09 because there is no clear successor. The opposition leader is sorry, Congress Gandhi. Yeah, the Congress party. Yeah, Rahul Gandhi. So Rahul Gandhi is still not a strong successor. Now, assuming at least till 2099, he is the prime minister. Now he has, from 2014, when he first came into power, had this neighbourhood first policy, which is that his idea was that India had been neglecting its own neighbourhood and trying to you know deal more with the USS Europe UK Australia that whereas he said let's focus on this first now that strategy becomes even more important because when he made that strategy Bangladesh was on India's side Maldives was on India's side. Maldives is now swinging and throwing, but Pakistan obviously wasn't. But there was a time. I mean, he genuinely had that had that principle throughout. Now Sri Lanka becomes even more important in that whole game because Sri Lanka is, as you mentioned, the only country that is genuinely allied with India. Therefore, I feel that India is willing to give us economic opportunities that they may not be willing to give other small countries. Because let's be honest about it. What does India really gain? You know, because everybody wants to trade with India. Yeah. Yeah. What does India gain by giving us any preference? I mean, it is a it's a diplomatic call that is made. Yeah. Right. So, my my question is, and this the forum the conference was called India Calling. So, if India is calling, are we heeding that calling? Are we answering? Yeah. So, what is India's Speaker 1 22:08 call? Right. So, if you go back over 100 years ago, under the British branch, when India was under under the British Empire, actually the Indian currency was the currency that was used even up to about it, so India, so the the British Empire extended to the Middle East from this part of the world, right? From Bangladesh to from Bangladesh to it went up to I think about Oman or Kata. It was this thing I think even parts of Saudi and all that. So it was it was it was the British Empire. So the British headquarters was in it was in Kolkata, right? I mean, the British Empire, the British Empire of this part of the world was run from Calcutta. The Indian rupee was the currency up to about Oman. So that was the administrative end part of the this part of the world where India was actually the the centre of things from the British Empire because India was called the Crown Jewel, right? Was it British Raj? Yeah, yeah, British Raj, right? So later on, then what happened was the British thought when the empire was falling that how are we going to keep it intact? Where all these parties are going to be governed by India? Then it's directly under Indian influence. Actually, it got to a point where the UAE they were in two thoughts. If Pakistan was going to take over, I mean, the partition was going off. Pakistan was going to take over part of the Middle East, or is it could be India? So then they thought, you know, the geopolitics already it's kind of messed up at the way it is, right? So might as well let them go on their own way, and that's how the that's how the current charindra chandrasena 23:38 map Speaker 1 23:38 was created. So one thing is India also has massive ambitions. There's no question about India, right? As they should, as they should, right? It's a it's a massive country with you know a lot of things. So currently they are kind of setting things up where they can get this global alignment also, because you know that the world is also no split in in in in ways. No, yeah, charindra chandrasena 24:03 but but but my my question regard is, I feel like it's a it's I mean there are no freelancers here. Yeah, but I feel that it's in India's interest to keep Sri Lanka close more than the geographical proximity to keep them close in terms of you know no hand Speaker 1 24:24 no so charindra chandrasena 24:25 the because it's not only Speaker 1 24:27 it's not only economics there's a big component which a lot of people don't talk is is actually the defence cooperation charindra chandrasena 24:32 that that's that's that's a that's another part as well so the Chinese influence that was creeping into Sri Lanka from 2005 onwards they have now managed quite successfully, I would say, to keep it at bay. Speaker 1 24:47 Yeah, charindra chandrasena 24:47 so much so that Sri Lanka is giving repeated assurances that Sri Lankan land cannot be used in any way that is, you know, detrimental to to India. So I think they have done that successfully. Especially with the the support that they provided during the economic crisis and all of that, I'm I'm just asking my point. My question is this: Isn't Sri Lanka getting a good offer from India in terms of okay, you come and trade with our massive market that the whole world wants to trade with, right? A country the size of Sri Lanka, which has right now little to offer as far as I'm concerned. Are we capitalising on that? That's why I'm asking. Like, if India is calling, are we are we actually responding? No, I don't Dhananath Fernando 25:32 think we are just we have switched off the phone. Then that's the thing, right? We are not answering definitely. So that's a market that we definitely have to tap. In fact, again, one other story which came out in that conference was Tilan Vijay Singh was there in one panel with Dr. Harsha and some other panellists, and he said, in fact, so during his time, this free trade agreement was signed when President Chandreya was in office. Yes. So in during that time, when they were signing it, actually the then Prime Minister in India, I think it was Atal Bihar Rajpal. He has in fact said, you know, India has been very unfair to Sri Lanka. So even in the negotiation process, if any conditions are unfavourable, you just just still go ahead because probably he may have understood the market size dynamics, but he said don't try to negotiate too much. Meaning, charindra chandrasena 26:30 President Chandrika said not to. No, no. Dhananath Fernando 26:32 Atal Bihar Vajra Bai has said for the Indian negotiation team, just get it done, even if it's if the terms are unfavourable in India. Right. Okay. You just go ahead. charindra chandrasena 26:41 There you go. Okay. Dhananath Fernando 26:42 Because we have been unfair. Of course, we know the story. Know what happened. You know in LDT. Yeah. You know terrorism issues and Indian peacekeeping force and peace. Yeah. So all that we have been unfair. So, but I think there was a different opinion in the panel. What people said was no. Okay. He termed it as like Mother India has hasn't been has hasn't been yeah trying charindra chandrasena 27:06 to yeah so Dhananath Fernando 27:06 people said like no let's keep that mother India story but it could have been a very transactional thing where both sides can get the benefit was the kind of the panel's other panel's opinion but keeping that aside on whether we capitalise I think we still have that capacity to capitalise because we are a small economy and all that. But I think India's defence and that's where they are concerned because they really cannot open a new battlefield. Yeah, defence. Yeah, new front on the on this side. Then it's because Speaker 1 27:35 yeah. So India, the so I'll just go through in categories. One big problem that they are going to have is if a Chinese military vessel, let's say a Type 55 destroyer, or something comes in for refuelling or comes docks in a harbour here, because then because India's defense-wise, their real problem what they're having is their south is their soft belly, because India's heavy military concentration is in the north, because in one side is Pakistan, one side is China, and the other side is relatively not that much. It's Bangladesh, right? So that is where that is where the problem is on the side. So if Sri Lanka is directly in the south, so then the defence capability of India in the south is less, right? It's their soft belly. So that is one part. Second, this thing is actually on trying to this thing trying to on the economic front trying to penetrate the Indian market. One thing is, I I don't think we can compete on price, right? So that means we have to compete on something that the Indians are not very good at, or we have to compete in something which is of high value, which a particular market we are going after segment, so that is why we look. We simply can't tap into that 1.4 billion. We can probably tap into maybe the maybe I would say top 1% or top 2% maybe 30 or 40 million, and we can start for the south, right? That's where the strategy should should come. Someone tells you know we are going to tap into 1.4 billion. It's it's for me. It's laughable. I mean, right. So that's not going to happen. No, but that's charindra chandrasena 29:06 a very very important point you make, yeah. Because what he's saying is we are always talking about India and the 1.4 billion opportunity. That's not really what you can go for. If you if you think I mean, what is apparel? What what is Victoria's Secret? You know, it's not a product that every woman in the world wears. Speaker 1 29:28 Yeah, absolutely. You know, it's a it's a bit of a you know niche. I mean, it's not elite, but it's it's a bit of you know. So that's what I'm saying. Now, for example, it has to be something which they are not good at. Now, for example, like if you take processed meats, we are far better. I have eaten what you call processed meat like sausages in India rubbish, right? Our sausages are much better. So processed food industry, I think John Kills is already. I think they are looking at entering the market in some way. That is the area we look at. Now, for example, I'm just saying, let's say India because the cultural things in India. Now Indians are normally predominantly 50 years ago. They are mostly non-meat eaters, right? They are bordering or they are vegan. No, either vegetarian, maybe only eggs, right? But now you get people in India who are consuming because socially, culturally, the kids have been educated overseas, so you tend to eat meat. So there's a new market that is looking to eat things like chicken and all that, okay. So for that, there is definitely a opening, right? And even if you set up, let's say, an Indian entrepreneur sets up a factory in India, you might have cultural issues there because you might be getting people who are vegetarians who don't want to work in a meat processing plant, right? So these are cultural issues, no cultural and religious issues. So that is where the opening comes. That's why you have said it has to be either you're targeting the 30 30 million or 30 million of the richest Indians, or you're targeting something the Indians will not be good at doing, or they'll have difficulties doing. Yeah, that is where we have to target. Yeah, charindra chandrasena 30:55 I I found the the the one part of your point more interesting than the other. Yeah, I think the processed meat example and all that is what we've been trying. But I find the other point more interesting in the sense that you you put it at 30 million, right? If if your number is correct, Speaker 1 31:10 yeah, charindra chandrasena 31:11 that's. And I'm not Speaker 1 31:11 saying it's a correct number. Let's assume it's correct, right? charindra chandrasena 31:14 If if it's correct or if it's in the ballpark at least, that's more than the entire population of Sri Lanka. Absolutely, right? And which means you're even at that extreme high level, you're selling to a whole country. Then Speaker 1 31:28 absolutely, so so that's the charindra chandrasena 31:29 population almost of Canada. Speaker 1 31:32 So Charlie, just let's just do the maths, right? Let's say 30 million, right? India is 1.3 billion, probably 1.4 billion, right? What is 1% 1% is basically 14,000,002% is 28 million. Already weak the target, charindra chandrasena 31:49 right? So okay, so we have say 28 million. Yeah, already more than Sri Lanka's population, more than Australia's population. Speaker 1 31:59 Yeah. charindra chandrasena 31:59 Okay. What I mean, I feel like okay. Then we focus on like what with with our with our tea, okay. Our tea is competing in terms of value and quality, yeah, and and and not price, yeah. So like that, I think if we can have a few more products, and then you can come in here. If we can have a few more of those niche, high-value products, maybe that could be a strategy as well. Dhananath Fernando 32:29 That can be actually. What I also realised was there are already Sri Lankan companies. What I mean, of course, Dambro you mentioned. I think there's Harpu's Pizza. There are few companies already there, but not like in you know in Inta India, but on selected places in Bangalore and selected places. Damro I'm not sure, but I know they are kind of expanded. But now they are, for an example, Maliban biscuits again. Maliban hasn't sponsored us. You can again sponsor us. They are entering India with Reliance as their partner. Same with John Keys. They are Ceylon Coast Shows. I think EGB and okay, they haven't sponsored us. Going to India as Reliance as a partner, and also Reliance is going to bring Camper Cola to Sri Lanka. They are like the soft drink brand. charindra chandrasena 33:20 Yeah, Coca Cola, Coca Cola alternative. No, so yeah, so India the big one is thumbs up, no? Thumbs up, maybe. Yeah, India traditionally the big one has been Pepsi. Dhananath Fernando 33:29 Yeah, charindra chandrasena 33:29 actually, Speaker 1 33:30 no, Pepsi. Yeah, yeah. Yeah, Pepsi more than Coca Cola. No, but they have they have a brand called Thumbs Up. Maybe. Yeah, but there is Reliance. I think Dhananath Fernando 33:38 under their portfolio. Okay. So so they are so basically they are partnering with bigger retail operators, and entry. And in fact, the Ravi Vazdia, who is the marketing CEO, he said, in fact, they are considering changing a little bit in their recipe to the Indian market because it's so different, even to the to to fit to their palate. They are doing, and also he said the they are doing the recipe based on the provinces and the states as well, rather the provinces is the states because each state has a different kind of a palate. Yeah, but they are looking at a more affordable premium product. Even he he gave the example of, for an example, a competing biscuit is like let's say 100 grammes for 100 rupees. Malibun is trying to offer 100 rupees because you can't compete on price, but for 80 grammes, it's still the premium is there at an affordable way. The same price, but it's not the same you know value proposition. Yeah. So they are looking at different options like companies to expand it to India in that context. So yeah, so things are happening. I mean, as you as as as we discussed, if you crack that market, and even I think Sri Lankan, there there are researchers and everyone is based there and doing experiments, and that's how they're trying to crack the market. So those are already. Happening actually, so what we need to do is basically get into that supply chain. Not every product will fit India, but we have to approach those, you know, context and basically tap the Indian market. charindra chandrasena 35:15 Historically, Dana, where has the the flaw been? Is it lethargy on our part? Is it a lack of interest altogether? Dhananath Fernando 35:25 I feel there's a lack of charindra chandrasena 35:27 strategy. Dhananath Fernando 35:27 No, I think it's all combined. But I think still I feel this again probably my personal opinion. We also have a perception issue. No, we are still not ready to believe how India has like developed and like the we always think okay India is like of course their per capita GDPs lesser than us but I mean 1.4 Speaker 2 35:49 billion population that's massive right yeah pretty much in the line Dhananath Fernando 35:52 of like becoming a global superpower so so there's a perception issue charindra chandrasena 35:56 no what you say is very true because you know have you heard this whole thing about like when when like sexual assault happens in Sri Lanka or state harassment happens, it's like we are oh my god! It's like we are becoming India. Yeah, you know that example. So that whole superiority complex we have of being a smaller but cleaner, well-mannered country compared to India. That perception, I think maybe blocking us as well from relying too much on India. Absolutely, Dhananath Fernando 36:24 but I think that it's. I mean, everybody changes, no? I mean, you evolve, so they have changed quite a lot. So that's one way to look at it. I think the other thing is, of course, our trade agreement and this trade integration. That's very weak because this ultimately has to happen through trade. No, you have to have a comprehensive agreement, which was kind of politically controversial. Of course, I am not saying it won't come at a it it won't come at cost free. There will be a political how shall I say repercussions or complications because yeah I mean for a comprehensive because already there is a trade agreement. What you are discussing is a mode for like a more comprehensive trade agreement, opening up services and all that, and then you connect the Speaker 1 37:07 result with labour migration. Exactly, so charindra chandrasena 37:10 isn't the another part of the problem that Sri Lankans fear because of the size disparity that any sort of agreement is going to help India just swallow us whole. Dhananath Fernando 37:24 Correct. That perception is also there. In fact, someone told something very nice. They said, you know, it's not about the size anymore. It's value that you bring. Now, even and I asked in my panel and I moderated. I asked like you know from Ravi and from Ketan, who was the representative from from Reliance, they said rather than the size, what we are looking at is the ethos and the brand fit because size doesn't matter. You can scale it up, but if the product is not good, if the ethos are not basically complementing each other, there is no business case because you are not you know you are not coming to eat up a market and all that, and you are we are too small to even put resources to you know eat up, and that's why they said like we are changing the recipe and we are making it palatable for a different audience, and that's how we are basically approaching the market. And Speaker 1 38:18 and there's another little area that I want to bring on tourism now. A lot of Indians come. Actually, their spends are quite decent. But the thing is, India can operate Sri Lanka if they can give the services. That's the hotel industry. Where for the weekend, Indians can come, stay here, and you know they might come in your in their private sector. They might come stay over the weekend, have a mega gala time here, and they'll go back, right? Because now, for example, if you take Bahrain, Bahrain, lot of the Saudi tourists because Saudi is a very restricted country, right? So because of that, you you get that famous King Faisal bridge. They cross over from Saudi to Bahrain, and lot of the lot of the Saudis over weekend. I mean, their weekend is Thursday and Friday. Oh yeah, Thursday and Friday. Yeah, Thursday and Friday. Yeah, so as I said, Friday is their weekend. It's got different. The Middle East, it's different. So they come over for their entertainment, whatever. They have a good time and they go back, right? It's just crossing the bridge there. So Sri Lanka also. It's not a big time that you spend travelling. No, you get into a plane within maximum two or three to two hours. Even if you're coming from Delhi, it's like two or three three hours, no, or something like that. And you come here, and you have your this thing, and you go back. So I think hotels also, but it has to be people of very high spenders. They you should give that value addition to them, of either experience, either it has to be a luxurious resort, or either adventure, or either you know we we are surrounded by ocean where you have a yacht you come you take them out for fishing or something whatever they want to do. I mean that kind of level strategy also from the tourism industry it has to go from the leisure sector, which I see not happening. charindra chandrasena 39:53 Right. Another another thing that we are I mean starting to capitalise on a little bit but haven't done sufficiently. Enough early enough is the wedding industry. Speaker 1 40:03 Yes, of course. charindra chandrasena 40:03 So an Indian wedding we all know is. I mean, you think Sri Lankan weddings are big, but Indian weddings it doesn't stop. Yeah, it doesn't stop. Speaker 1 40:12 Goes for 10 days sometimes. Yeah. So charindra chandrasena 40:13 2000 people, 3000 people, that kind of guest counts we are talking about. So if we can attract those, that's a bulk in one. Yeah, but do you know where Indians go most for weddings? Still, the most popular destination is supposed to be Thailand. Speaker 1 40:35 Okay. charindra chandrasena 40:36 Okay. Speaker 1 40:36 Okay. charindra chandrasena 40:37 That is far away compared to Sri Lanka. Speaker 1 40:40 Correct. charindra chandrasena 40:40 So why Sri Lanka not there? No, because in terms of natural beauty, we have it all. Speaker 1 40:45 Yeah, charindra chandrasena 40:45 it's Speaker 1 40:46 it's charindra chandrasena 40:46 packaging. It's infrastructure. It's the biggest Speaker 1 40:49 problem is the infrastructure because the the hotels what we have. Even though we think the guys who come there who spend that kind of money, they want ultra lakshin. charindra chandrasena 40:58 Absolutely, Speaker 1 40:58 that is like you know Shangri Laval. They want so so that is what needs maybe more than that. Maybe more than and you need the other problem. What they have is the interconnection within the country. Those guys come, you can't expect them to put them in a bus and tell them to write eight hours to trinko. Forget about it. You know you get it. It should be sea plane or whatever, yeah, or or a chopper helicopter that goes and drops them, they will spend. For for that, I think you need to get more collaboration, even with the big tourism operators. Yeah, they need to collaborate with foreign companies who will bring the expertise and plus they bring the capital to capitalise on this. So that is something I think one of overall strategy they need to look into. charindra chandrasena 41:39 Yeah. So the only positive, as far as the weddings is concerned, is that Sri Lanka is the fastest growing destination, apparently, as far as in the unbound wedding seconds on Speaker 1 41:51 numbers. Yes, charindra chandrasena 41:52 yes, right. So in that sense, we have something to look forward to. Before we, yeah, no, Dhananath Fernando 41:59 the point that I forgot that the strategy, the solution that I have is, I think only ICTA won't give us a breakthrough. I mean, ICTA will bring some benefits for sure. But what I am considering is what my what I am proposing is there's RCEP, which is another multilateral trade setup, which Australia, New Zealand, Indonesia, this East Asia. Yeah, something charindra chandrasena 42:25 like regional cooperation, economic partnership. Absolutely, Dhananath Fernando 42:28 RCEP. So we have to get into sign join RCEP and ECTA both. The reason is India is not joining RCEP as it as we speak because they because of China and all that they don't want to join RCEP. So we are the only country who will be having an advantage joining RCEP. And if we have ECTA, so we are the unique, we are a unique position that we can someone who is located in Sri Lanka have preferential access for India, big market. So as RCEP, entire region, so that can do a lot of cross trade within this region rather than looking at the European and US markets, which is nothing wrong with looking on those markets. But that's where we can trade with closer countries because at the moment we are exporting to far away countries, but we can we are importing from China and India. Yeah. But now we can try to export for countries which is in our closer proximity, and then yeah, so that's why I'm thinking ECTA and RCEP both has to be signed together, provided hopefully India will not join RCEP, and then we will have unique advantage. That's where no charindra chandrasena 43:36 good point you make because why is the US still our largest export destination, especially when it's as unreliable as it has been over the last 10 years. We we really haven't given attention to our neighbourhood, our region. So yeah, I mean, food for thought for for the administrators, for the government, for the policymakers, and we we we hope we've encouraged that food. Yeah, absolutely, absolutely. So before we wind up, Dana, you can give your. I think I told you. Yeah, you you you already entered the message, but you can give it. But yeah, so Dhananath Fernando 44:15 so the challenge when we do this kind of podcast to provide independent opinion is that you get criticism by both sides? So that's why we want to depend on our viewers and our subscribers and our insiders. So you can become part of Advocata by becoming an Advocata Inside. It's just 12,000 rupees a year, 1000 rupees a month, and especially charindra chandrasena 44:38 because you are not actually sponsored by any of the brands. Exactly, any of the brands that I Dhananath Fernando 44:42 mentioned, we haven't been getting any sponsorships, and we will. We don't want to at the same time, because then it's very difficult to keep the independence. So that's why we want to have a broader, small ticket item donor base to continue the good work that we do, and we provide. Research analytics. You are not just only joining a policy community. You also get exclusive analysis in Singhala, mainly on stock exchange, about the currency, about the property market. Likewise, many other exclusive analyses by becoming an Advocata insider. Of course, we have insider plus, inside a premium. There are multiple categories you can subscribe for, so consider joining as an Advocata insider. charindra chandrasena 45:28 All right. So thank you, Dana, as always, and thank you, Riyadh, for coming in with your insight and interesting viewpoints. So I'll see you guys next week as well, and thank you for tuning in. Give us your thoughts and suggestions, and we will see you again next week. Transcribed by https://otter.ai