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President took his oaths before the country's Chief Justice in a nationally televised ceremony. The election which brought him to office was won last January but he served the remainder of his first term until this week.
President Rajapaksa ended a 30-year war with Tamil Tigers last year and the country is recovering from an economic downturn. This year growth is officially projected at 8.0 percent and inflation at 6.9 percent is low by historical standards.
Rajapaksa said Sri Lanka's youth has joined the military and won a victory.
"We want to make your motherland a Wonder of Asia with a well trained skilled younger generation," President Rajapaksa said after taking oaths.
He said he wanted a generation that spoke three languages and where there were no racial, religious or even political differences.
If excessive state spending can be curbed, analysts say private business investment could be boosted and Sri Lanka can sustain high levels of growth, helped by low inflation and e