NEW DELHI -- Sri Lankan Prime Minister Ranil Wickremesinghe Friday said his government was discussing with India an agreement to liberalize trade and reduce investment barriers between the two South Asian neighbors.

"India and Sri Lanka already have a free trade agreement ... our countries are now beginning to discuss an agreement for economic cooperation that will broaden the range of goods traded freely," Wickremesinghe said in notes prepared for delivery to the "India Today Conclave".

The three-day event, which began Friday in New Delhi and is being organized by India Today weekly magazine, is to be addressed by national and international leaders of government, business and policy.

Wickremesinghe, delivering the keynote opening address, said Sri Lanka wanted to revive itself as a major trade hub in the region.

This would particularly benefit southern India, which is closest to the island nation, he said.

"It is possible to see a dynamic south India-Sri Lanka sub-regional center playing a major role in the economic prosperity of Southeast Asia," he said, likening it to the impact the Pearl River Delta had on China's development.

The prime minister said his country is on the path to recovery after two decades of war and is building a high growth economy.

Peace returned to the troubled country after a Norwegian-arranged truce a year ago between the Sri Lankan government and Tamil Tiger rebels.

Wickremesinghe also expressed hope of building a land bridge between India and Sri Lanka. "This is not as far fetched as it may sound. In ancient times there was a bridge across the Palk Straits separating our two countries."

The prime minister praised India for its economic reform program but said it needed to take steps to attract more foreign investment. (AFP)