Among the major Malaysian companies having operations in Sri Lanka are Axiata Group Bhd in cellular mobile phone network, Merbok Hilir Bhd in medium density fibreboard, Lagenda Sentissa Sdn Bhd in public payphone system, Felda Marketing Services Sdn Bhd in cultivating oil seeds and hydrogenated edible oil, and Pembinaan Wincon Sdn Bhd in housing development, the report said.

Stating that Malaysia was expected to remain as one of the main investors in Sri Lanka in the next five to 10 years, Ranasinghe said the Government was calling on the Malaysian business community to invest in various sectors promoted by BOI as the country was now in a new phase of economic development.

Among the sectors are infrastructure, tourism, education, logistical services, agriculture, manufacturing, rubber industry, business process outsourcing and software industry as well as gems and jewellery.

Sri Lanka is now enjoying peace and security within a stable political environment under the present government and it has entered into a process of fast-tracking the development of infrastructure such as roads, airports, harbours and power supply while expanding the related services, including insurance, telecom services, and sea and air connectivity," he said.

MIDA Director-General Datuk Jalilah Baba said Malaysian investment in Sri Lanka for 2008 amounted to RM96 million and for the January-September 2009 period, it totalled RM26 million.

Major investments were in services, manufacturing, financial intermediation, real estate activities and construction, she said.

Jalilah further said that total trade between Malaysia and Sri Lanka amounted to RM394 million for the first three months of this year, with exports at RM309 million and imports at RM85 million.

Last year, total trade between both countries amounted to RM1.32 billion, with exports at RM1.17 billion and imports at RM150 million, she said.

"There is vast potential to increase trade between both countries. Malaysia can supply Sri Lanka with a wide range of quality products such as electrical and electronic products, rubber and wood products, palm oil, and optical and scientific equipment," Jalilah further noted.