Bangalore, May 22 : Sri Lanka's Board of Investment Sunday set up its first overseas office here in a bid to attract investments from India in diverse sectors of the economy.

On the very first day, the board received two investment offers from Bangalore-based Kaypee Exim Ltd and its subsidiary Amrutha Estates.

Kaypee proposed to invest Sri Lankan Rs.500 million (Indian Rs.250 million) to set up a cement bagging unit near Colombo, while Amrutha wants to grow medicinal plants by taking land on lease in hilly areas of the island nation for making bio-pharma products.

Though the board will woo major Indian companies across the country to invest in Sri Lanka with a plethora of incentives and tax holidays, it decided to locate its office in Bangalore to attract hi-tech industries, especially IT and business process outsourcing (BPO) services and biotech industries.

On the occasion, Sri Lanka's Industry, Tourism and Investment Promotion Minister Anura Bandaranaike told a gathering of prospective investors and captains of the Indian industry that the growing economic cooperation between the two countries in the wake of the Free Trade Agreement had generated substantial benefits to the public and private sectors.

"India ranks among the top five countries in Sri Lanka in terms of investments made last year," Bandaranike said.

"With a cumulative investment of $200 million, about 80 Indian companies have set shop in the island. Some of these companies are planning to expand their presence."

Major Indian firms present in Sri Lanka include Indian Oil, Piramal group, Apollo Hospitals, Gujarat Ambuja, Asian Paints, Ceat Tyres and Taj group of hotels.

"Our decision to locate the Board of Investment here is prompted by the progressive role played by Karnataka and Bangalore in pioneering the hi-tech industrial revolution in India. In view of its reputation as the technology hub, Bangalore has emerged as a global brand," Bandaranaike said.

In this context, he said he was already in dialogue with some leading IT companies, including Infosys Technologies Ltd, to explore Sri Lanka for offshore and onsite operations.

"I believe the growing pool of skilled human resource and entrepreneurship in Sri Lanka is being geared to serve the needs of the hi-tech industrial and service sectors. They can be combined with the technology and management inputs of Karnataka to produce world-class products and services," Bandaranaike said.

According to Sri Lanka Board of Investment chairman Saliya Wickramasuriya, the panel will play a pivotal role in reaching out potential investors across India, especially from the four southern states.

The Board of Investment was set up in 1978 to stimulate and broad base the growth of Sri Lanka's economy in the wake of the liberalisation in 1977.

"Over the years, the board has been able to facilitate 1750 enterprises to set shop, with a majority of Sri Lanka Rs.320 billion investments coming through the FDI (foreign direct investment) route," Wickramasuriya said.

"Till date they have generated about one million direct and indirect jobs and exported goods valued at Sri Lanka Rs.2.5 trillion, which constitutes 65 percent of our total exports annually."

(IANS)