Overview
Nepal and the Democratic Socialist Republic of Sri Lanka established diplomatic relations on 1 July 1957. Relations between the two countries are marked by goodwill, mutual understanding and cooperation. Nepal opened an Honorary Consulate General in Colombo in 1975 and established Embassy in 1995. Sri Lanka has a residential Embassy in Kathmandu since 1993. Both Nepal and Sri Lanka are the founding members of the South Asian Association for Regional Cooperation (SAARC) and are also members of the Bay of Bengal Initiatives for Multi-Sectoral Technical and Economic Cooperation (BIMSTEC). The two countries share similar views on many international issues and work closely at various international forums including the UN, NAM, and WTO, among others. In 2017, Nepal and Sri Lanka celebrated the 60th Year of the establishment of diplomatic relations between the two countries.
Bilateral engagements
The exchange of high level visits at various levels has elevated the already happily existing bilateral relations to a new height. At the invitation of His Excellency Mathripala Sirisena, President of Sri Lanka, Rt. Hon. Bidya Devi Bhandari, President of Nepal visited Sri Lanka to attend the concluding ceremony of the International Vesak Day held in Kandy in May 2017. Similarly, the then President of Sri Lanka His Excellency Mahinda Rajapaksa visited Nepal in November 2014 to attend the 18th SAARC Summit held in Kathmandu and on a State Visit in March 2009. He also visited Nepal in October 2009.
During the State Visit of the president of Sri Lanka to Nepal in March 2009, Nepal and Sri Lanka signed an agreement on the establishment of a Joint Commission at the level of Foreign Ministers of both countries. The provisions of the Agreement include the cooperation in the areas of trade, finance, agriculture, industry and development of infrastructure, science and technology, investment and other matters mutually agreed upon.
Trade
The volume of trade between the two countries remains minimal despite signing the bilateral trade agreement as early as in April 1979. Major exports from Nepal include raw hides and skins, carpets, tanning and dying extracts, whereas major items of import include lead, rubber and mineral fuels.
Table 1: The trade figure for the past five years between Nepal and Sri Lanka:
Value in ‘000 NRs.
| Year | Imports from Sri Lanka | Exports to Sri Lanka | Trade Balance |
| 2012 | 139,343 | 15,485 | -123,858 |
| 2013 | 141,126 | 2,788 | -138.338 |
| 2014 | 743,324 | 1,967 | -741,357 |
| 2015 | 24,591 | 44,313 | -199,278 |
| 2016 | 148,609 | 3,272 | -145,337 |
Source: – Trade and Export Promotion Center, GON, 2016
Tourism
Lumbini, the birth place of Shakyamuni Buddha and one of the holiest destinations for the Buddhists from around the world, has been attracting the Buddhist pilgrims from Sri Lanka every year. The Government of Sri Lankan remains supportive to Nepal’s efforts to further develop Lumbini as the fountain of World Peace. Sri Lanka has also built a Monastery and a Rest House Complex in Lumbini.
Table2: Tourist Arrival to Nepal from Sri Lanka
| SN. | Year | No. of Tourists |
| 1 | 2011 | 59,884 |
| 2 | 2012 | 69,476 |
| 3 | 2013 | 32,736 |
| 4 | 2014 | 37,546 |
| 5 | 2015 | 43,117 |
| 6 | 2016 | 57, 521 |
Source: – Ministry of Culture, Tourism and Civil Aviation 2016
With the aim of increasing the flow of tourists from either country through direct air connectivity between Kathmandu and Colombo, the two countries signed an Air Services Agreement (ASA) in March 2009 in Kathmandu.
Investment
Sri Lanka has made joint venture investment in the banking and insurance sectors of Nepal. Nepal and Sri Lanka signed the Avoidance of Double Taxation Agreement in July 1999.
Culture
Cultural and religious relations have brought the people of both countries closer. The two countries signed a Cultural Agreement in July 1999. The Agreement has helped promote cultural interactions between the two countries through various types of socio-cultural exchanges.
Post Earthquake Cooperation
Following the devastating earthquake in Nepal in 2015, Sri Lanka sent its rescue teams and relief materials with promptness and also participated in the International Conference on Nepal’s Reconstruction.
The Government of Sri Lanka is assisting for the reconstruction of Rato Machchindranath Temple at Bungamati and Ananda Kuti Bihar at Swoyambhu that were damaged in the earthquake.
Source: Ministry of Foreign Affairs