Stressing that the end of the Tamil Tiger insurgency had presented a ''historic opportunity'' to build permanent peace, Prasad Kariyawasam unveiled an ambitious bilateral agenda of engagement with India that includes starting talks on a comprehensive economic partnership agreement (CEPA) and a ferry between Colombo and Tuticorin in Tamil Nadu.
"China is an old friend, but India is an older friend. Our relations with India go back 2,000 years. Our political and economic friendship with China will not be at the expense of India," Kariyawasam said in an interview.
"We will not be a party to any mechanism or effort to harm India's strategic interests. Harming India's interests will be like harming our interests," he said, when asked to comment about concerns in New Delhi over Beijing's growing presence in Colombo.
China has pledged $350 million as post-war financial aid to Sri Lanka and has bagged a large chunk of development projects which are estimated to be worth over $6 billion.
India has pledged Rs.500 crore (around $100 million) for rehabilitation of around 300,000 internally displaced people and is also involved in a wide array of infrastructure projects.
Stressing that Sri Lanka needs all international partners to spur its development, the envoy underlined that Colombo's ties with New Delhi were set to acquire more economic and strategic weight in the days to come.
"We expect to widen an FTA (Free Trade Agreement) and negotiate a comprehensive economic partnership agreement," he said. "We have a conceptual understanding on this. We plan to start formal negotiations this year."
India's FTA with Sri Lanka was the first such pact India has signed with any country. It has boosted bilateral trade, now estimated to be over $3 billion. "We hope to multiply it to $15-20 billion in another 10 years," he said.
Lauding India's assistance in reconstruction of the war-hit areas, the envoy said New Delhi was involved in many infrastructure projects that included railway lines in the country's north as well as building the Palali airport and the Kankesanthurai port in the Jaffna peninsula.
The envoy said the promised devolution of powers to the Tamils would take place step by step and emphasised that President Mahinda Rajapaksa was waiting for the moderate democratic leadership to emerge before fast-tracking the process.
"In the last 25-30 years, the LTTE (Liberation Tigers of Tamil Eelam) had eliminated the moderate Tamil leadership. We now have a historic opportunity for the emergence of the moderate Tamil leadership and to create conditions for reconciliation," he said.
Indicating a lasting settlement with the Tamils who comprise around 12 percent of the population, the envoy said the reconciliation and devolution process would work around the India-backed 13th amendment of the constitution that deals with powers to the provinces.
He said there were plans to give more representation to the minorities in the upper chamber in Colombo to "neutralise majoritarian tendencies".
"We, however, can't give police powers to the northern and eastern provinces as they don't have the mechanism to absorb them," he added. The reference was to the war zone where the Sri Lankan military crushed the LTTE in May 2009, ending one of the world's longest running insurgencies.
On resettlement of those displaced by the war, he said nearly 70,000 refugees remained in military camps while more than 200,000 had been sent back to their homes.
"Every day 1,000 or so are leaving. It will not be proper to call them camps. It's like a relief village. The rest will return after the de-mining of the area," he said.