In the first quarter of 2016, arrivals were up 22.1 percent to 584,818.
Visitors from South Asia rose 28.6 percent to 96,913 with Indian arrivals surging 38.2 percent to 30,170 from a year earlier.
Indian arrivals in the first quarter rose 32.2 percent to 85,624, overtaking China despite arrivals rising 46 percent to 77,914.
Arrivals from China rose 40 percent to 19,645 in March.
In 2015 China displaced India from its long time pole position as Sri Lanka's top generating market. India became Sri Lanka's top market after an administration in 2001, improved economic freedoms and ended visa requirements.
The last administration also helped tourist arrivals by providing fast e-visa and improving economic freedoms by ending paper work, physical documentation and delays.
Sri Lanka has become the latest Indian destination for weddings and the country is getting good press in Indian media.
Visitors from Western Europe rose 22.6 percent to 69,972, with British arrivals rising 32 percent to 44,813.
German arrivals rose 6.3 percent to 16,264. Arrivals from France rose 11 percent to 11,175, visitors from Italy rose 30 percent to 2,683 and visitors from Sweden rose 43 percent to 2,339.
Sri Lanka has seen a surge of new smaller hotels coming up with internet booking engines driving sales.
Sri Lanka's tourist promotion office has also helped the trend with light handed regulation. The tourist agency could stop the growth of the industry by tightening regulations.
Sri Lanka's larger overpriced hotels have been calling for tighter regulations to block their growth.
But economists including those from Harvard had warned authorities to confine regulations only to maintaining safety standards especially including fire hazards.
High end and budget hotels compete in different markets. The mass-market budget tourism sector promotes more people-to-people contact is in closer to the true capitalist ideal, bringing wider benefits to lower income segments, compared to high-end tourism.
Over the last year Sri Lanka's rupee has also collapsed slashing real wages of tourist sector workers through the slave-labour effect of the neo-Mercantilist philosophy of a 'competitive exchange rate'.
Source : http://http://www.economynext.com/