India has unveiled plans to supply LNG to Sri Lanka, with ambitions to connect the power grids between the two nations and establish a petroleum pipeline.

This announcement was made by Indian Prime Minister Narendra Modi during a joint press briefing with Sri Lankan President Anura Kumara Dissanayake in New Delhi.

During President Dissanayake's inaugural official visit since his election victory, the two leaders discussed energy collaboration.

Petronet LNG, an Indian state-run enterprise, has secured a five-year contract to deliver LNG to Sri Lankan engineering company LTL Holdings' power stations in Colombo from its terminal in Kochi.

The initiatives include a proposal to interlink the power grids and lay a multi-product petroleum pipeline, as per a joint statement from the Indian External Affairs Ministry.

These projects aim to strengthen energy security and the economic partnership between the neighbours.

The meeting underscored the growing energy ties and potential for further collaboration in the sector.

India provided more than $4bn (Rs339.64bn) in assistance to Sri Lanka in 2022 after the country faced a significant economic downturn. In July, India joined other bilateral lenders including Japan and China in a preliminary agreement for debt restructuring.

The two nations will now conclude talks regarding the bilateral memorandum of understanding required to finalise the debt restructuring process.

In addition to LNG supply, India and Sri Lanka have consented to jointly explore offshore wind power potential in the Palk Straits.

In a related development, India is set to lead Asia in oil and gas transmission pipeline additions, contributing more than 40% of the region’s total by 2028.

More than 50 planned and announced pipelines are expected to begin operations, adding over 26,000km, with around 24,000km already approved for development.