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Sri Lanka is a tear drop shaped island nation located in the Indian Ocean, just off the southeastern coast of India. Despite its modest size, Sri Lanka has a population of 20 million people. The island is rich in natural resources and has a diverse economy based on agriculture, mining, fishing, manufacturing and tourism ("Sri Lanka: History, Geography, Government and Culture") which gives it a varied list of exports as well as imports.

Sri Lanka’s top exports as well as imports are mainly apparel based. Exports include: outwear (textile fabrics, unknitted and crocheted), tea and mate, undergarments (knitted and crocheted), pearls and precious stones, rubber tires, articles of apparel, air craft and associated equipment, copper, spices, fruits and nuts and fish. The country’s top imports are crude petroleum and oils obtained from bituminous minerals, woven cotton fabrics (not including narrow or special fabrics), refined petroleum products, knitted or crocheted fabrics, fabrics that are woven or man-made fibers, pearl and precious stones, passenger motor vehicles, unmilled wheat or meslin, paper, polymerization and copolymerization products, textile yarn, lorries and special purposes motor vehicle, non-monetary gold (excluding ores and concentrates), telecommunication equipment, sugar and honey, milk and cream, medicinal and pharmaceutical products and fertilizer. By carefully examining Sri Lanka’s top exports and imports, culture, history and relationships with other countries, we can deduce patterns of trade as well as its overall trade performance.

The pattern of trade that can be seen in Sri Lanka is more of the Heckscher-Ohlin (H-O) Theory of trade. This can be seen in the types of goods that Sri Lanka both exports and imports. Most of Sri Lanka’s top twenty imports are raw textile materials such as cotton fabrics, woven man made fabrics, textile yarn, and many others. Raw materials make up 12.99% of total trade. This is...