The ‘ethnic question’ in Sri Lanka, even after the defeat of the Liberation Tigers of Tamil Eelam (LTTE), evokes a sense of suspense, uncertainty and even a possible conflict of interest in the otherwise robust and multifaceted relationship between India and Sri Lanka. The article adopts a multi-agent model derived from the positional analysis and identifies three principal agents in Indo-Sri Lanka relations—the Government of Sri Lanka (GoSL), the Government of India (GoI) and Tamil Nadu. Based on interviews and interaction with a wide cross-section of respondents in India and Sri Lanka, the article argues that GOSL is better placed to address the ethnic question today, especially because of changes in the outlook of the GoI and Tamil Nadu.