Sri Lanka, officially the Democratic Socialist Republic of Sri Lanka (Sinhalese: , Tamil: இலங்கை; known as Ceylon before 1972) is an island nation in South Asia, located about 31 kilometers (18½ mi) off the southern coast of India. Popularly referred to as the Pearl of the Indian Ocean, it is home to around twenty million people.
Due to its location in the path of major sea routes, Sri Lanka is a strategic naval link between West Asia and South East Asia, and has been a center of Buddhist religion and culture from ancient times. Today, the country is a multi-religious and multi-ethnic nation, with a quarter of the population following faiths other than Buddhism, notably Hinduism, Christianity and Islam. The Sinhalese community forms the majority of the population, with Tamils, who are mostly concentrated in the north and east of the island, forming the largest ethnic minority. Other communities include the Muslim Moors and Malays as well as Burghers.
Famous for the production and export of tea, coffee, rubber and coconuts, Sri Lanka boasts a progressive and modern industrial economy. The natural beauty of Sri Lanka's tropical forests, beaches and landscape, as well as its rich cultural heritage make it a world famous tourist destination.
After over two thousand years of rule by local kingdoms, parts of Sri Lanka were colonized by Portugal and the Netherlands beginning in the 16th century, before the control of the entire country was ceded to the British Empire in 1815. During World War II Sri Lanka served as an important base for Allied forces in the fight against the Japanese Empire. A nationalist political movement arose in the country in the early 20th century, with the aim of obtaining political independence, which was eventually granted by the British after peaceful negotiations in 1948. Since then Sri Lanka has struggled in maintaining a liberal democracy , ,, and stunted economic progress  due to the ongoing conflict between the Sri Lankan government and a separatist militant group known as the Tamil Tigers in the northeastern parts of the country.
Sri Lanka according to the US State Department in 2005 had stabilized into a stable democracy (during the ceasefire period) and the 2005 presidential elections was considered free and fair by international monitors, although the LTTE called for a boycott of the elections, leading to Mahinda Rajapakse winning the election by a slim margin . The election results however remain controversial .
With an income per head of $1,350, it still lags far behind some of its neighbors including Maldives and Mauritius but is ahead of its giant neigbour India. Its economy grew by an average of 5% during the 1990s during the 'war for peace' era. According to the Sri Lankan central bank statistics, the economy was estimated to have grown by 7% last year, although inflation had reached 20%. It should be noted that Sri Lanka's central bank statistics have been called into question due to allegations of political interference and institutional decay . Parts of Sri Lanka, particularly the South and East coast were devastated by the 2004 Asian Tsunami. The economy was briefly buoyed by influx of foreign aid and tourists, but this was disrupted with the reemergence of the civil war resulting in increased lawlessness in the country  and a sharp decline in tourism .