Sri Lankan President Mahinda Rajapaksa conceded defeat in his bid for a third term in office on Friday, a result unthinkable just weeks ago for a confident leader hoping to cash in on his economic record.
Rajapaksa lost to his former friend and health minister, Maithripala Sirisena, who defected from the ruling party and turned the election into a referendum on the president with expanding power since his victory over the Tamil Tigers in 2009. Rajapaksa had called the vote two years early, a move seen by many as a test for triumphalism.
The results from the largely peaceful elections could signal a period of better relations between India and Sri Lanka which had, under Rajapaksa, drifted closer to China. Here are five areas where ties could shift:
Smoother ties with Sri Lankan Tamils - Many Tamils have felt abandoned since the war's end in 2009, when Rajapaksa largely ignored their demands to heal the wounds of the fighting and years of ethnic divisions. The results highlighted the ethnic polarisation in the country, with Tamils and Muslims, the second-largest ethnic minority, both voting against Rajapaksa.
For India, the Rajapaksa government’s treatment of Tamils of Indian origin had been a constant source of disagreements and friction. New Delhi could now hope to get clearer understanding and satisfaction on how ethnic Tamils will be treated and on their acceptance as equal citizens alongside ethnic Sinhalese in Sri Lanka.
Reduced security engagement with China – The outcome of the polls will be watched keenly in New Delhi and Beijing since both have large stakes in the island nation. China has made large strategic and commercial investments in Sri Lanka with Rajapaksa beholden to Beijing for its military support in his war against the Tamil Tiger. In the closing months of the war, India refused to supply any lethal weaponry but China sold Jian-7 fighters, anti-aircraft guns and JY-11 3D air surveillance radars to the resurgent Sri Lankan army. Pakistan also supplied the Sri Lankan army small arms, multi-barrel rocket launchers and trained its air force in precision guided attacks against the Tamil Tigers. Today, about 70 per cent of Sri Lankan military hardware is Chinese. Chinese investments and part ownership of Sri Lankan maritime assets remains a deep cause of worry for India.
While Sri Lanka under a new government may not entirely disengage with China given its surging cash reliance on Beijing to build its infrastructure, New Delhi could look forward to a correction in Colombo’s strategic proximity to Beijing as well as an overall rebalancing of the island nation’s external relations. Sri Lanka is likely to be more sensitive to Indian concerns about third-party security presence in that country.
Smoother execution of Indian developmental projects in Sri Lanka – Under Rajapaksa, India faced a number of administrative difficulties in executing development projects, especially those to resettle Tamils in Sri Lanka’s north. For instance, only 20,000 houses for Tamils could be built since 2009 with Indian support against a target of 50,000. Indian state investments in Sri Lanka total some $1.3 billion, much of it going into post-conflict reconstruction. India is also helping with the Omanthai-Pallai and Kankesanthurai railway line as well as the harbor reconstruction in Kankesanthurai. Earlier New Delhi helped build the Matara-Colombo railway link in 2012.
Stronger trade ties – Bilateral ties under a new government will likely see more focus on the state of Sri Lanka's economy. For Sri Lanka, costly short-term foreign debt, much of it from China taken to build its infrastructure, is a worry. Indian investments in Sri Lanka have grown. Sri Lanka is also dependent on India for much of its fuel.
Given that a strategic relationship is also governed by trade, India will have a lot of room to manoeuvre in Sri Lanka. The long stalled Comprehensive Economic Partnership Agreement between the two countries could be revived.
A genuine democracy – Buoyed by his military victory over the Tamil Tigers, Rajapaksa steadily tightened his grip on power, amending the constitution to eliminate term limits and dismissing a Supreme Court justice who resisted his changes. The system known as "executive presidency" gave his family a tight grip on the economy and politics, in what critics said was subversion of democracy by a one-family rule.
Friday's election result could reverse that and once again see Sri Lanka returning to a true democracy.