Whenexamining the economy in the country it was dramatically increased.

After thewar, like other provinces the northern and eastern provinces also activelycontributed their part for the economy of the country. A good example for thiswas there was an amazing growth in fishing industry during this period. Not onlyin fishing industry but also a distinguished growth in other industries is alsonoticeable within this particular period. The main reason behind this economicgrowth was becoming northern and eastern habitant`s lives better and expansionand opening up of new job markets and opportunities with the end of suffocatingterrorism. Despite the guns, rifles and war young generation started to exposein to the world with new aspirations in their lives. And also day by day thejob demand of young people changed or moved around different new fields andinvestment in those particular fields catered all those new aspirations.

Inanother way opening up the market for new and good paying jobs increased thehousehold income and strengthened the government in power.Aforesaidtrend in the economic process was existed not only in northern and easternprovinces of Sri Lanka, but also it was prevailed over the whole country. Thiswas a result of free movement of people and free movement of goods whichresulted with the peace in the country. With this Sri Lankan citizen was ableto carry on their livelihood freely without any hindrances. Moreover both localand foreign investments started to flow in to the country in large shares. Thegovernment by that time expected a growth rate target of 8% in Sri Lanka. Inorder to reach this level of growth rate Sri Lanka needed about 35% investmentand also it had to be as a share of Gross Domestic Production (GDP).

Generallyinvestment needs of any country are most of the times bounds by the availabledomestic savings and in Sri Lanka this was very low like -17%. Therefore therewas a demand in the country for more investments. Therefore the respectivegovernment encouraged foreign investments in the country and provided necessaryfacilities with the process. Even there was an awakening in private sector ofthe country with the growing economy of Sri Lanka than any instance.Thisbecomes a golden opportunity for India and china to achieve their economicinterests over Sri Lanka and both countries competitively elaborated theircapabilities in Sri Lanka.   Meanwhile Sri Lanka attempted to achieveeconomic interests by adapting some neo liberal policies in to their economicreforms.

And also the Government took necessary measures to reduce and tocompletely substitute the welfare fees of certain fields like health, educationand social welfare. The former Indian High Commissioner of Sri Lanka, Ashok K.Kantha, once stated that with the end of the war in 2009, it is a good time toenhance the bilateral economic relations between two countries gaining mutualsatisfaction and productive engagement.

Although such Indian involvements ineconomic factor is comparatively lower than China`s it is clear that behindthose involvements there are political aspirations. The reason for this is mostof the Indian government projects are in Northern part of Sri Lanka. 


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