Home to nearly a quarter of the world's population, South Asian countries have already grown at annul rates exceeding 6% in the 1990s.  The growth, until now, been sustained by the internal market and income growth.  With the winds of economic liberalisation sweeping the region, it is only a matter of time before trade and investment expand rapidly in line with the rest of the world.

Given its historical and cultural affinity with the Sub Continent, Sri Lanka is uniquely poised to capitalise on the impending economic take-off in South Asia.

The vision of Sri Lanka the island-nation in the region, is to establish itself as the gateway to South Asia.  This vision envisages Sri Lanka as the service hub of the region, a region that has regained the attention of the global investors and industrialists, following half a century of self-imposed economic isolation.  Historically when regions develop, a strategic locality or a small neutral country within the region emerges as the centre which provides the necessary support services and the link with the rest of the world.  Examples are Singapore, with respect to servicing Malaysia, Indonesia and Thailand, and Hong Kong which continues to act as the gateway to China, the Netherlands and Belgium, dwarfed as they are by France and Germany nevertheless benefited economically from their trading links, and even Lebanon, once the trading Mecca of the Middle East has revived its economy, after decades of civil strife.  All these examples share the common experience of being small entry points into larger geographical entities.  Their size and liberal trade policies are their strengths.  These factors enable them to develop faster than their neighbours.  With the relatively small population of 18 million and without major economically significant natural resources, Sri Lanka has of necessity to be a trading and services centre, rather than a manufacturing centre.  The region needs a centre, which is an economically liberal and investor friendly in terms of a regulatory, legal, political and bureaucratic framework.  Moreover, the region requires a centre which is culturally cosmopolitan, tolerant of foreign people, and yet, having cultural affinities with its neighbours.  A gateway should have geographic proximity to all the growing localities in the region, and be convenient and cost effective, in terms of logistics.

What is driving growth in South Asia is the newly found commitment to Free Trade, after almost 50 years of misplaced, protectionist, state-controlled economic policies.  The winds of change, which are sweeping the region, are bringing in their wake, profound changes in the way the huge economies of India and Pakistan interact with the rest of the world.

Another indication of the highly accelerated economic growth in Sri Lanka is the Indo-Lanka Free Trade Agreement, which is directly linked to SAFTA (South Asian Free Trade Agreement).  India which is considered the giant in the Indian Sub Continent and also labelled as the next "China PRC".   Selecting Sri Lanka ahead of Pakistan and Bangladesh gives ample evidence to business community about the enormous potential and opportunities available as a low cost based, but a high quality manufacturing and a trading country.  Sri Lanka is considered as the trading hub in the Indian Sub Continent due to its perfect strategic and geographical location.