India and Sri Lanka on Wednesday inked a pact for cooperation in ‘economic projects’, but refrained from clinching the proposed deal for jointly operating an oil storage facility on the east coast of the island nation.

A meeting between Prime Minister Narendra Modi and his Sri Lankan counterpart Ranil Wickremesinghe was followed by signing of the Memorandum of Understanding (MoU) for ‘Cooperation in Economic Projects’.

The MoU outlined the agenda for ‘bilateral economic cooperation in the foreseeable future’, Gopal Baglay, official spokesperson of the Ministry of External Affairs, said.

Modi and Wickremesinghe also expressed ‘the hope for early conclusion of the ongoing negotiations on the Economic and Technology Cooperation Agreement’, Baglay added.

India and Sri Lanka have since long been negotiating a bilateral trade deal – now known as ‘Economic and Technology Cooperation Agreement.’

The agreement could not be inked due to concerns by Sri Lankan business community over possibility of it tilting the bilateral commerce more in favour of India.