India-Pakistan Crisis: Sri Lanka Navigates Neutrality Amid Strategic Anxieties
Among South Asian countries, Sri Lanka usually suffers the least from conflicts between India and Pakistan, due to its island status and consequent geographic separation from the rest of South Asia. However, India’s unilateral suspension of the Indus Waters Treaty (IWT) has caused great unease in Colombo.
Given that Sri Lanka has reached important agreements with India, geopolitical commentators are calling for greater deliberation and scrutiny before entering into deals with India in critical sectors such as energy, infrastructure, and connectivity.
The Indus Waters Treaty of 1960, a water sharing agreement between India and Pakistan that was brokered by the World Bank, survived numerous wars and tensions between India and Pakistan. However, following the terrorist attack at Pahalgam in Kashmir on April 22, the Indian government decided that it was holding the IWT “in abeyance.”
Pakistan responded by describing the Modi government’s decision to suspend the agreement as an act of war. Given that the Indus river is the most important source of water for most of Pakistan’s farms and hydropower plants, India’s potential withdrawal from the IWT would have significant implications for the Pakistani economy in the long-run. If India were to build the infrastructure that diverts water from the Indus system in the coming years, it could lead to hostilities between the two countries.
Political analyst and former Ambassador Dayan Jayatilleka told The Diplomat that the abrupt suspension of this important agreement, without consultation, has raised uncomfortable questions about the reliability and durability of agreements with New Delhi.
Sri Lanka is currently negotiating several agreements with India, including one to connect their national grids and another to build a land bridge connecting the two countries. It is under immense pressure from India to do so.
“If India can unilaterally freeze an important agreement like the Indus Waters Treaty with Pakistan,” Jayatilleka said it would be “silly” for Sri Lanka to sign agreements with India that would place Sri Lanka’s electricity and fuel supply in India’s hands.
The Sri Lankan government has wisely decided that it does not want a land bridge with India, he said, adding that similar caution should be applied to all strategic agreements.
These anxieties are not limited to the realm of connectivity or energy. India’s decision to unilaterally withdraw from the IWT has caused many in Colombo to worry about the fate of other key bilateral agreements, most notably the Katchatheevu agreement of 1974 under which India ceded the uninhabited island of Katchatheevu in the Palk Strait to Sri Lanka.
Although India relinquished control over the island, the issue is periodically unearthed by Indian politicians during Indian elections, especially in Tamil Nadu, where politicians regularly call for its retrieval. In 2024, Indian Prime Minister Narendra Modi and Foreign Minister S. Jaishankar also raked up the issue, to the consternation of many in Colombo.
Given the current climate of unilateral decision-making in New Delhi, there are fears that India could one day revoke or reinterpret the Katchatheevu agreement if it suits its domestic or strategic interests. Such a move would threaten Sri Lanka’s sovereignty and also have serious implications for fisheries, maritime boundaries, and the broader security relationship in the Palk Strait.
Indian diplomats in Colombo have sought to assuage Sri Lankan concerns in the wake of Delhi’s suspension of the IWT.
In a recent interview with Sri Lanka’s Daily Mirror, Indian High Commissioner Santosh Jha pointed out that India’s “relations with Pakistan and Sri Lanka are built on different premises.”
“Sri Lanka is a centrepiece of India’s Neighbourhood First policy. Our relations today are marked by unprecedented trust and goodwill at all levels. Not just with Sri Lanka but we have energy connectivity projects with our other neighbours such as Bhutan, Nepal and Bangladesh,” he said.
However, few in Colombo are convinced.
As one Sri Lankan official remarked privately, “If the Indus Treaty can be frozen after decades of being called untouchable, what guarantee do we have that other agreements, even those with a clear legal basis, are safe?”
Following the outbreak of hostilities between India and Pakistan, Sri Lanka’s official response was a reiteration of its longstanding non-aligned stance.
“We are closely observing the situation between India and Pakistan. Our position is guided by the principles of sovereignty and regional peace. We will not engage in any geopolitical conflict in the Indian Ocean region,” Cabinet Spokesman Dr. Nalinda Jayatissa said. He further clarified that Sri Lankan territory, airspace, and waters would not be used by any country against another.
One must remember that during the 1971 war between India and Pakistan, then Prime Minister Sirimavo Bandaranaike allowed Pakistani planes to refuel in Colombo even as a contingent of Indian troops was protecting the Katunayake Airport from left-wing insurgents.
However, as a small island nation, Sri Lanka will find that maintaining neutrality is easier said than done.
Under Prime Minister Narendra Modi, India has been increasingly assertive, politically, militarily, and economically. India pressured the Gotabaya Rajapaksa and Ranil Wickremesinghe administrations to sideline China and agree to several important agreements regarding connectivity. The current administration has been slowly pushing back on these agreements and the current developments can only make Colombo more hesitant on deeper integration with India.
