The international prize is awarded each year to writers of fiction, non-fiction, poetry and drama for their body of work. Writers are nominated secretly and cannot apply.
Shakthi won the award for his ambitious, multigenerational plays exploring Sri Lankan Tamil migrant experiences, including his debut Counting and Cracking. The play, co-written with Belvoir artistic director Eamon Flack, also won the $100,000 Victorian Prize for Literature in 2020.
Shakthi told ABC Arts he "felt proud our stories can be on that global stage".
He found out he won via email a few weeks ago while shooting his debut movie The Laugh of Lakshmi, about a mother and son separated by civil war, in Sri Lanka.
"The stories I tell are not the usual stories this country tells,"
he said.
"To get that global recognition hopefully puts forward a version of Australia which is a bit more progressive than our current reality here."
Shakthi added the money also makes it possible for him to continue to pursue a career as a writer.
"I still have to fight hard to do anything in this country," he said.
"It's so incredible to be able to write from a place of focusing on the art."
Shakthi said he was "still in shock" about his win.
"The prize is for an artist's body of work, he wrote. The judges decide the winners by reading their work. This means a group of strangers overseas — who had never heard of me — were taken in by these stories of Asia and Australia and chose to embrace them.
Inspired by Shakthi's family history, Counting and Cracking went on to tour the UK and New York.
His family was forced to leave Sri Lanka following the 1983 Black July pogrom in Colombo, which killed an estimated 5,600 Tamils.
Speaking to ABC Arts in 2024, when the play opened in Melbourne, Shakthi said making Counting and Cracking helped him and his mother come to terms with their migrant identities.
"To tell the gloriously complex story of your community in full public view, and to have other people embrace that, has been a radical act of belonging."
In 2022, Shakthi reunited with Flack for The Jungle and the Sea, which explicitly uncovered the toll of the Sri Lankan civil war (1983-2009).