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Initial step to the trade and commercial relations between the two countries was established subsequent to the implementation of the historical Economic and Industrial Cooperation Agreement. The above agreement was signed on 25th February 1958. The agreement was based on barter trade. Tea, rubber, coconut oil, cir fiber were exported from Sri Lanka and the Soviet Union supplied machineries, raw material and other essential goods in return.

Both countries concluded number of short term agreements of 1 – 2 year periods. The objective of such agreements is to decide the products and their volume which could be exchange between the two countries. As an example, In 1964, both countries concluded an agreement with a view to double the total trade between the two countries within two years. Soviet Union agreed to supply, machineries, petroleum, sugar and some more products and Sri Lanka agreed to supply tea, rubber, and coconut oil in return.

When both countries started diplomatic relations in 1957, the total trade volume between the two countries were Sri Lankan rupees 2 millions. It increased up to Rupees 198 million in 1966. In 1975, it increased to Rs. 244 millions.

Sri Lanka and the Soviet Union signed a new agreement on 25th March 1977. Both countries decided to use convertible currency method instead of barter trade according to the agreement. In addition to that more products were added to the list of commodities. Printing paper, cloths, lathe machines, cellulose were added to the commodities imported to Sri Lanka from Soviet Union while non traditional goods such as ready made garments, shoes, canned fruit and fruit juice were added to the export products of Sri Lanka to the Soviet Union.

Ceylon tea has played the major role of Sri Lanka’s exports to the Soviet Union.