Ahead of talks with President Maithripala Sirisena, the top US diplomat said he saw "extraordinary opportunities" opening up for bilateral ties and commended the new regime for pursuing reconciliation after the devastating Tamil separatist conflict.
"Today we have talked about the enormous progress Sri Lanka has made in just a few months," said Kerry after talks with Foreign Minister Mangala Samaraweera.
"I'm here today because I want to say to the people of Sri Lanka that in (this) journey to restore your democracy the American people will stand with you," added Kerry in a statement to the media delivered alongside his counterpart.
"In Sri Lanka today we see extraordinary opportunities... The president, the prime minister, the foreign minister are not afraid of tackling tough issues."
Since coming to power in January elections, Sirisena has begun delivering on his pledges to reduce some of the powers of the president, effectively reversing changes brought in by Rajapakse to strengthen his hand.
Lawmakers voted overwhelmingly on Tuesday in favour of restoring a two-term limit for the president and reviving independent bodies to manage key institutions such as the police and the judiciary.
Kerry also praised the new government for "working on creating an enduring peace" with the Tamil minority after the end of a 37-year ethnic conflict that claimed more than 100,000 lives.
Sirisena, who mopped up most of the votes among the Tamil minority in the polls, has vowed to pursue reconciliation efforts more vigorously than Rajapakse, who had a reputation as a hardline Sinhalese nationalist.
Samaraweera, who was on hand to welcome Kerry at Colombo airport, had equally warm words for his guest, the first US secretary of state to visit Colombo in a decade.
'Special relationship'
"Today is the beginning of a very very special friendship," said the foreign minister.
Shortly afterwards, Kerry arrived at the president's office where he shook hands with Sirisena for waiting camera crews before they began talks behind closed doors.
During Rajapakse's rule, Washington was close to slapping sanctions on Colombo for refusing to allow investigations into claims of mass killings and rights abuses at the end of the war between the Tamil Tiger rebels and government forces.
As Sri Lanka's relations with the West and regional powerhouse India soured, Rajapakse turned increasingly to Beijing, with Chinese-funded investments projects springing up across Sri Lanka.
Since coming to power, Sirisena has tried to reset the diplomatic balance, choosing New Delhi for his first foreign visit and offering the hand of friendship to other key players who fell out with his predecessor.
Political analyst Victor Ivan said Sirisena realised it was vital for Sri Lanka to have better relations with the West as it had become dangerously dependent on China - both for loans and diplomatic cover.
"Mahinda thought he could depend on China and China alone," Ivan, an editor at the Ravaya weekly newspaper told AFP. "That was a big mistake."
A senior State Department official said there had already been a change in the "tenor and tone" of Sri Lanka's dealings with the United Nations, which initiated its own investigation into war crimes last year after Rajapakse refused a domestic inquiry.
Kerry was instrumental in persuading Rajapakse to accept the results of the January 8 election that brought an end to a nine-year rule marred by rampant nepotism and corruption allegations.
Amid rumours Rajapakse might try to cling to power by force, Kerry spoke to him at the time to press what he called "the importance of maintaining a peaceful process no matter what".
Kerry afterwards hailed the "peaceful change of power" in Sri Lanka, mindful of the contested outcome of several recent elections in South Asia.
As well as meeting Sirisena and Prime Minister Ranil Wickremesinghe, Kerry will deliver a speech on reconciliation in a country where at least 100,000 people died during a 37-year ethnic conflict that ended in 2009.
He will meet the leaders of the main Tamil political group, the Tamil National Alliance, on Sunday morning before flying to the Kenyan capital Nairobi.
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