Indian Tourists Can Soon Use UPI in Sri Lanka: PM Modi, SL Prez Wickremesinghe Reach Agreement

In a bid to promote seamless cross-border transactions, India and Sri Lanka have signed an agreement to launch the Unified Payments Interface (UPI) in Sri Lanka. The agreement was reached during a bilateral meeting between Sri Lankan President Ranil Wickremesinghe and Prime Minister Narendra Modi in Delhi on Friday.

The India-Sri Lanka Economic Partnership Vision statement highlighted the commitment of both nations to promote digital payments and further enhance trade and transactions between businesses and individuals. The UPI system is known for its efficiency and low-cost fund transfers, making it an attractive option for cross-border transactions.

Foreign Secretary Vinay Kwatra, briefing the media on the outcomes of the bilateral meeting, stated that the UPI payment system would be operational in the next two-three months.

He also clarified that the digital payment system would not be limited to the government platform BHIM UPI payment app, as private payment platforms would also be allowed to operate in Sri Lanka.

UPI’s APPEAL

The UPI has gained global appeal for its ease of use and cost-effectiveness in facilitating international transactions. Several countries, including Singapore, Malaysia, UAE, France, BENELUX countries, Nepal, and the UK, have already embraced UPI payments, recognizing its potential to revolutionize cross-border financial transactions.

India and Sri Lanka have further agreed to designate the Indian Rupee (INR) as the currency for trade settlements between the two countries. This move is expected to boost trade and economic ties between the two nations, simplifying financial transactions and fostering increased economic cooperation.

Last week, at an Indian CEO Forum event in Colombo, Wickremesinghe had indicated Sri Lanka’s openness to accept the Indian currency as common currency in the Island nation. “It makes no difference to us if India (the Indian Rupee) becomes a common currency. We will have to figure out how to go about it. We must become more open to the outside world”, he had said. “The world is evolving and India is undergoing rapid development, particularly under Prime Minister Modi’s leadership,” he added.

PUSH TO TOURISM

Both the sides have also pledged to promote India’s Buddhist circuit, Ramayana trail and ancient places of religious worship in Sri Lanka to enhance tourism. Sri Lanka’s hospitality industry has been struggling to recover from the effects of COVID-19 pandemic and the politico-economic turmoil of last year.

India is the second-largest source of tourists for Sri Lanka and the island is aiming to attract two million Indian tourists this year. Direct flights between Chennai-Jaffna and Colombo-Mumbai opened in the past one year have facilitated the growth of tourism and business activities between the two nations.

The successful implementation of UPI in Sri Lanka is aimed at making Indian tourists’ life easier while increasing the cross-border transactions and remittances, promoting economic growth and cooperation.

Modi-Wickremsinghe also agreed to establish land connectivity between Sri Lanka and India for developing land access to the ports of Trincomalee and Colombo. A feasibility study for such connectivity will be conducted at an early date. Two sides will also work to resume passenger ferry services between Nagapattinam in India and Kankesanthurai in Sri Lanka and work towards early resumption of ferry services between Rameshwaram and Talaimannar, and other mutually agreed places.