Entry of India’s largest gas player to revolutionise Sri Lanka’s LNG market

• India’s biggest industry chamber introduces large-scale investors to SL
• SL reforms the stimulus that excited us - CII’s Mutha
• Scouting for investments in many industries here - CII’s Mutha
• Indian investors have important roles in our FDI, trade - Bathiudeen
• CII has 8,000 large corporate and other members; present in top overseas destinations

Ongoing economic reforms in Sri Lanka have excited Indian corporate investors, amongst them India’s biggest player in their domestic LNG gas sector who is bidding to enter the Lankan market to supply the new, green LNG, and also to revolutionise the present LNG supply system here as well.

“Ongoing economic reforms in Sri Lanka have awakened our interest here,” announced Ramesh Kumar Mutha, leader of a business delegation visiting Colombo from the Confederation of Indian Industry (CII) yesterday in Colombo.  

Mutha was speaking to Industry and Commerce Minister Rishad Bathiudeen in Colombo. CII is the largest industry chamber in India.

Among the CII industry sectors and companies meeting Minister Bathiueeen were automobiles (Tata Motors), exports (Mohan Mutha Exports, an Indian Government-accredited star export house), energy (Petronet LNG), refractories (Caldery’s India Refractories), tobacco processing (Ankita Overseas Ltd.) and water supplies (Shubham Aqualink). 

The Indian industry and biz-led, not-for-profit CII has more than 8,000 members from Indian multinationals, corporates and SMEs and is a leading policy influencer. More importantly CII is a reference point on overall Indian SMEs, multinationals and industry. It has an additional 200,000 other member firms as well. CII has offices in nine overseas destinations - China, Australia, Bahrain, Egypt, France, Germany, Singapore, the UK and the US. CII also has institutional partnerships with 320 counterpart organisations in 106 countries.  

“Reforms are taking place in both the Sri Lankan and Indian economies. Both economies are on a growth path,” said Mutha.

“Members of my delegation are keen in partnering in energy, LNG Gas, export links and water supplies here. We are scouting for investments in Sri Lanka in these sectors. For example, Petronet LNG Ltd, India’s largest importer of liquefied natural gas, has called for a large-scale project in Sri Lanka,” he added.   

“We welcome Indian investors to our industries,” said Minister Bathiudeen, going on to state, “Our Unity Government’s aim is to develop our economy towards the higher middle-income ranks and reforms play a key role in it. Your Indian investment to Sri Lanka is annually between $ 50 million to $ 70 million. Indian investors have a significant role here. For example India was the fifth-largest investor in Sri Lanka in 2015. Your investments can increase our two-way trade. Last year our total bilateral trade was $ 4.3 billion and our leading exports to India showed results of diversification efforts, the main exports from Sri Lanka being spices, nuts, paperboards, ships and boats. More importantly, more than 60% of our exports to India were products under ISFTA. New Indian investments here can strengthen this positive trend further.”

Petronet LNG Ltd. Deputy Manager Manik Jhamb explained that Petronet LNG has already submitted their proposal for Sri Lankan entry. 

“Our proposal for Sri Lanka envisages an operation where we will supply clean LNG in comparison to what is seen in the Sri Lankan market today. Investing in it is a win-win for the Lankan Government, consumers and for us since it is green LNG and therefore a shift will occur to cleaner LNG in Sri Lanka. More importantly, we will revolutionise the supply system here in that we will introduce pipe-borne LNG supply to households, thereby removing the need for the use of a cylinder-based method. It’s a large-scale project and we are ready for entry upon the go ahead. Petronet LNG is a joint venture by the Government of India to import LNG and set up LNG terminals in the country, and involves India’s leading oil and natural gas industry players including GAIL (India) Ltd, Oil & Natural Gas Corporation Ltd. (ONGC), Indian Oil Corporation Ltd. (IOCL) and Bharat Petroleum Corporation Ltd. (BPCL). The authorised capital of Petronet is $ 240 million.”

Minister Bathiudeen praised Petronet LNG for its initiatives in Sri Lanka. “Your efforts can strengthen the local gas market. I and my officials shall extend our fullest support to you and other Indian investors partnering with us,” he assured.

During yesterday’s meeting, Minister Bathiudeen and CII’s Mutha also discussed other avenues of industrial cooperation and his previous interactions with CII.