"The persistent allegations against the Sri Lanka Navy with regard to alleged killing and harassment of Indian fishermen are erroneous and without any factual basis," a foreign ministry statement said.
"The Sri Lanka Navy is under strict orders to treat all Tamil Nadu fishermen, who cross regularly into Sri Lanka waters, in a humane manner."
At the same time, Sri Lanka has "continually and emphatically" impressed upon Indian authorities to take action "regarding the very large number of fishing boats daily entering Sri Lanka's territorial waters".
These Indian fishermen, it said, exploited fisheries resources and caused grave damage to the livelihood of fishing communities in the north of Sri Lanka.
The statement also denounced the anti-Sri Lanka propaganda carried on by Tamil expatriates over the alleged death of thousands of Tamils during the last stages of the war that crushed the Tamil Tigers in 2009.
The statement, which follows mounting anger against Sri Lanka in Tamil Nadu, underlined the "civilisational ties and cultural links between all parts of India and Sri Lanka".
"The governments of India and Sri Lanka have worked closely to combat terrorism and extremism, safeguarding the sovereignty and territorial integrity of Sri Lanka..."
It said that since the Liberation Tigers of Tamil Eelam (LTTE) was defeated, Sri Lankans of all communities "enjoy peace and tranquillity".
It said the government was implementing, step by step and in a structured manner, the recommendations of the Lessons Learnt and Reconciliation Commission (LLRC) to providing equity and justice for all Sri Lankans, in particular for those in the island's north and east.
"It is regrettable that sections of Tamil communities living abroad have resorted to sustained protests and calls for unfriendly measures against Sri Lanka, ostensibly to obtain political rights for Tamils in Sri Lanka.
"These groups and parties have recommended solutions and demands that have no relevance to the ground realities in Sri Lanka but can militate against the efforts taken by the government of Sri Lanka to provide justice and to arrive at arrangements for reconciliation."
The statement said demands in India to stop calling Sri Lanka a friendly country "are disturbing and do not relate at all to the continuing friendship and cooperation between India and Sri Lanka".
It said descriptions of the military conflict with the LTTE and its concluding phase "in an emotive and unrealistic manner and demands for international intervention in Sri Lanka are devoid of merit and smack of prejudice.
"Allegations levelled against the Sri Lankan state, its leaders and security forces are based on hearsay, misinformation, misperceptions and ethno-nationalistic ideologies.
"The government of Sri Lanka is keen to move forward with its efforts at equity and justice, notwithstanding the innumerable crimes and acts of terrorism committed by the LTTE, mostly against Tamil Sri Lankans.
"Sri Lanka needs time and space to move forward on the course already charted in order to provide justice and dignity for all Sri Lankans."