Sri Lanka's Economic Acceleration Framework 2020-2025

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Sri Lanka has seen a discernible slowdown in economic growth owing to a multitude of domestic and external factors. With the country’s rise into the Upper-Middle Income threshold (as defined by the World Bank), it is imperative that the country unlocks economic growth through carefully designed and implemented reforms. Unless this is done, Sri Lanka risks being caught in the middle-income trap.
It is with the intention of proposing to policymakers, interventions that are identified from a private sector perspective that the Ceylon Chamber set about formulating an Economic Development Framework targeting the 2020-25 period.
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Sri Lanka Economic accelerate Framework Lanka Economic accelerate Sri Lanka Economic sector work Group proposed
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Sri Lanka Economic accelerate Framework Lanka Economic accelerate Sri Lanka Economic sector work Group proposed
Framework
Acceleration
Economic
Sri Lanka
2020-25
Working Draft

SRI LANKA ECONOMIC ACCELERATION FRAMEWORK 2020-25 | 1
Background: 
Sri Lanka has seen a discernible 
slowdown in economic growth 
owing to a multitude of domestic 
and external factors. With the 
country ’s rise into the Upper-Middle 
Income threshold (as defined by 
the World Bank), it is imperative 
that the country unlocks economic 
growth through carefully designed 
and implemented reforms. Unless 
this is done, Sri Lanka risks being 
caught in the middle-income trap. 
It is with the intention of proposing 
to policymakers, interventions that 
are identified from a private sector 
perspective that the  
Ceylon Chamber set about 
formulating an Economic 
Development Framework  
targeting the 2020-25 period. 
The Chamber set up eighteen 
(18) Working Groups to obtain 
inputs to formulate the Framework. 
The common and cross-cutting 
recommendations from these groups 
can be found in the pages that 
follow. The detailed input which 
consists of policy intervention, 
implementation mechanism and 
targets are found in the respective 
Working Group chapters.  
“It is imperative 
that the country 
unlocks 
economic 
growth through 
carefully 
designed and 
implemented 
reforms”
Accelerating 
Sri Lanka’s 
Economic 
Trajectory
2 
| WORKING DRAFT 
THE
VISION
The vision espoused in our document is for an economy that will 
be USD 134 billion by 2025 from the current (2018) USD 89 
billion. For this to vision to be a reality, our expectation is for GDP 
to steadily rise from the current 3% levels to 5%-6% in the next few 
years. With this stronger base, we anticipate growth to then take 
off to 7-8% levels by 2025. The growth is expected to be driven 
via sectors such as exports (merchandise goods and services), 
tourism and transportation and logistics amongst others.
SRI LANKA ECONOMIC ACCELERATION FRAMEWORK 2020-25 | 3
2025
134
USD BN
2018
89
USD BN
nominal GDP
nominal GDP
6.8%
Average Real
gdp growth
2020 - 2025
A USD 134 
Billion 
Economy 
by 2025
4 
| WORKING DRAFT 
Acceleration
Framework
        POLICY           
 NATIONAL          
GOVERNANCETrade
National Security
Execution Performance Meritocracy Minimising   corruption  “…….”Tax
Ethnic Harmony
Social Inclusiveness
Law and Order
Digitisation
Education
Innovation
Energy
SME
Health
AGRICULTURERETAILTOURISMSectoral growth ambition on backdrop of cross-cutting enablers, 
policy transformation levers and governance fundamentals
SRI LANKA ECONOMIC ACCELERATION FRAMEWORK 2020-25 | 5
        
 EFFICIENCY 
         
INTEGRITY 
TRANSFORMATIVE LEVERStreamlining the bureaucracy  Addressing the bottlenecksReforming SOEs“…….”Macro stability 
Respect of Human Rights
“…….”
Sustainability
“…….”
“…….” Denotes that the sub components are not limited to the ones mentioned
MANUFACTURINGEXPORTSPLANTATIONSTRANSPORTATION & LOGISTIC“…….”This model can be considered to view the economic trajectory in a holistic perspective considering the overarching pillars of 
Governance, National Integrity, Transformative Levers and Policy Efficiency which will drive the key horizontals (such as digitisation, 
energy) and vertical sectors (such as agriculture, tourism) of the economy. The key tenets of the pillars, horizontals and verticals are 
spelled out, but are not exhaustive to the ones mentioned in the model. 
6 
| WORKING DRAFT 
Focus 
Areas
Key 
Pillars
Economy
Unity & Harmony
Socio-Economic Development
Hygiene Factors
Factors such as better public sector, 
strong foreign relations, strong 
national security
Governance
SRI LANKA ECONOMIC ACCELERATION FRAMEWORK 2020-25 | 7
Transformation 
& Reform Levers 
for Uplifting the 
National Economy
Key Pillar: Governance
1. Strategise - Implement - Transform
Why?
Sri Lanka has many vision documents and 
national policies across many sectors. 
However, the execution and implementation 
is often weak, or non-existent.
How?
This document lists several current plans and 
programmes that must be implemented fully, 
e.g. the National Export Strategy.
We recommend the following initiatives:
 Formulate a National Implementation 
Oversight Committee consisting of both 
public and private sector officials, with 
sub-committees formed at different levels.
 An action tracker for all government 
initiatives, mandatory quarterly 
progress reports and a sound public 
communication strategy.
 Mandatory performance audit by 
the Auditor General’s department, in 
addition to a fiscal audit function.
 Vesting the overall function of monitoring 
development projects with a line 
Ministry responsible for monitoring and 
evaluation.
 The Bill formulation process should be 
made more efficient.
 Taking an inventory of incomplete 
projects, and complete projects which 
are viable. Non-viable projects need 
not be completed, on the principle that 
“good money need not be thrown after 
bad”.
8 
| WORKING DRAFT 
Key Pillar: Economy
2. Energize State-Owned Enterprise (SOE) Reforms
Why?
SOEs have been a key source of 
macroeconomic instability that has plagued 
Sri Lanka for several decades. 
54 out of 422 SOEs classified as 
strategically important
57% of GDP Asset base in 2018
Rs. 26 billion Loss before tax in 2018
If the Banking and Finance SOEs are 
removed from this classification, it would be 
a total aggregate loss of Rs 122 billion. 
This value is three (3) times the government 
recurrent expenditure for Samurdhi payments. 
The losses in part could be explained by the 
absence of market-based pricing while the 
balance is due to weak governance and 
management.  
While some solutions have been discussed 
and plans devised to turn this narrative 
around they have repeatedly fallen short in 
terms of implementation. A reason for this is 
the political fallout due to the high level of 
employment provided in SOEs. 
However, the stakeholders go beyond those 
holding employment to the near 22 million 
population that are shareholders of these 
public institutions.
How?
There are case studies of successful reform of 
SOEs such as SLT that can be built on. 
SOE reform could be a catalyst to revive 
the capital markets which can be used as 
a source of funding without resorting to the 
cash-strapped Treasury. 
It is important for a future government to 
prioritise SOE reforms with a focus on better 
engagement and communication to sell the 
urgency and need for reform. 
A way forward has been provided in detail 
in our SOE recommendations from pages 
32 - 33.
3. Address Bottlenecks in the Economy
Why?
In the process of compiling this document, a 
few cross-cutting bottlenecks that held back 
growth in the economy were identified.
How?
It is imperative that steps are taken to 
address the following:
A. Availability of land for commercial use
B. Labour – 
a. Scarcity of labour in multiple 
industries;
b. 
low female participation in the 
labour force;
c. many sectors have unfilled 
vacancies and lack of skilled staff, 
while there is “under-employment” in 
other sectors. 
C. Consistent Tax regime and achieving 
higher tax collection
 
The importance of improving tax 
collection and achieving a higher % of 
GDP; policy consistency in the tax law 
regime.  
Transformation & Reform 
Levers for Uplifting the 
National Economy
SRI LANKA ECONOMIC ACCELERATION FRAMEWORK 2020-25 | 9
D. Quality, reliability and cost of 
Electricity supply
E. 
Implications of ageing demographics
 
Sri Lanka faces an ageing population 
where the elderly population will surpass 
the youth population in the next 02-
03 decades. This requires immediate 
attention to address implications 
for pensions, health and education 
amongst others. 
F. Growing Pension Liability
 
The pension cost in terms of cash 
outflows from the state in 2018 was 
approximately 1.3% of GDP and 9.3% 
of the total recurrent expenditure. 
With ageing demographics and high 
employment in the public sector, this will 
become a higher burden in the coming 
period. 
4. Avoid the ‘Boom and Bust’ Cycles 
Why?
The government should put in place stable 
polices that will enable sustainable growth 
reversing decades of growth fuelled by either 
fiscal or monetary stimuli. 
How?
This requires policy consistency and clarity. 
Continue current efforts towards fiscal 
consolidation through higher tax collection 
and prudent expenditure. 
Maintenance of Central Bank independence 
will be key in providing credibility to both 
investors and businesses.
Laudable programmes such as the 
National Export Strategy should continue 
to be implemented while expediting the 
implementation of the Trade Facilitation 
Agreement. 
Evidence-based decision making must be 
integrated into the Government policy-
making process. Government institutions 
should be required to maintain accurate and 
relevant data. 
The right to access Government information 
provided for in the Right to Information Act is 
laudable, and should be continued so that 
citizens may access information relevant to 
development programmes. 
10 
| WORKING DRAFT 
Transformation & Reform 
Levers for Uplifting the 
National Economy
Key Pillar: Economy
5. Review price controls and caps 
Why?
The functioning of the market economy 
is impacted by government intervention 
through price controls and caps in varying 
forms, including maximum retail price on some 
products and interest rate caps on deposits 
and lending.
These are often introduced without 
understanding the underlying reasons for the 
normal market prices and do not address 
said reasons or quantities of supply and 
demand. 
Very often price controls / caps lead to 
shortages, discourage investment and worsen 
the demand / supply of such products.
How?
It is necessary to re-evaluate the price 
controls and caps, and use these sparingly 
and as short-term measures. 
6. Realizing the ‘Wealth’ of Potential Opportunities 
Why?
It is not all doom and gloom for Sri Lanka’s 
economic trajectory. Our deliberations have 
highlighted numerous opportunities in pushing 
the economy to achieve its full potential.
How?
The following are a few such potential areas 
for growth:
 
improvement of Sri Lanka’s tourism 
offerings,
 transforming Sri Lanka into a retail hub 
and a medical/wellness destination,
 pursuing growth in exports through 
agricultural and manufacturing related 
exports,
 exploring service exports, which display 
a high growth potential in ICT and 
Logistics services,
 tapping into the significant export 
potential in value added mineral exports 
and petroleum exploration,
 and implementing a proactive 
engagement strategy with the diaspora, 
enabling Sri Lanka to reap a Diaspora 
Dividend similar to that which other 
countries such as India and China have 
achieved in its economic development. 
SRI LANKA ECONOMIC ACCELERATION FRAMEWORK 2020-25 | 11
7. Leveraging on opportunities in IR 4.0 and Digitisation
In order to remain globally competitive, Sri Lanka must continue to make significant advancements on the digital front. There are other mega-
trends taking place in the global economy with the advent of the 4th Industrial Revolution. Sri Lanka needs to integrate such developments to 
propel growth. 
Sri Lanka should implement a Digital ID system and the necessary data protection legislation to seamlessly connect with its citizens to offer 
services such as banking, health and payment of taxes,
12 
| WORKING DRAFT 
Fundamental 
Hygiene Factors as 
a Foundation for 
Sustainable Growth
Key Pillar: Unity & Harmony
1. Preservation of National Security and Ethnic Harmony
Why?
The economic plans and national 
development are reliant upon peace and 
harmony, and law and order.
How?
An effective strategy against terrorism 
Strategy to curb riots and violence within the 
rule of law
Respect human rights, freedom of expression 
and right to information
Key Pillar/s: Governance & Hygiene Factors
2. Public Sector Reform: 
A. Streamline Government Ministries and Departments 
Why?
The sheer number of ministries today leave 
the citizen confused and inconvenienced, 
and should be limited to avoid an 
unnecessary drain on resources.
How?
A rational basis for the assignment of subjects 
and functions to Ministries to aid sensible 
and speedy decisions.
Where there are cross-ministerial/department 
linkages, introduce an Inter-Ministerial Taskforce.
National Policies should be administered by 
suitably qualified officials who do not change 
roles based on change of government or 
Ministers.
Ministerial allocations should be based on 
capacity to deliver results - not on seniority in 
the governing party, in Parliament or otherwise. 
Movement towards an accrual system for 
Government accounting from the existing 
medium-term cash-flow system by 2023/24.
Disclosures by key line ministries and the 
Finance Ministry to ascertain critical 
information on the total liabilities including 
guarantees, pension liabilities and subsidies.
SRI LANKA ECONOMIC ACCELERATION FRAMEWORK 2020-25 | 13
B. Re-orient the Public Sector to Deliver High-quality Service to the People
Why?
65 Public Servants per 1,000 citizens
Our Public Sector is extensive, and drains 
national resources.
A more efficient public sector is an absolute 
need in recalibrating Sri Lanka’s economic 
trajectory. 
How?
The following should be looked at:
 Ensure that Secretaries to Ministries 
are knowledgeable and competent 
- able to realise the macro vision 
of the Government, while delivering 
administrative and financial controls.
 Avoid frequent transfers of Secretaries.
 
Initiate process improvement at 
Government Institutions to provide a 
high-quality service and minimize cost 
and time spent by stakeholders on 
obtaining services.
 Public sector salaries and benefits to 
be in line with KPIs that target improved 
service, productivity and profits.
 Accomplish existing initiatives to digitize 
the Government, while introducing new 
initiatives in line with global benchmarks.
 Address and optimize underutilization of 
Government Assets due to supply chain 
issues, maintenance and repairs and 
manpower deployment.
 Conduct a review of the size and cadre 
of the public sector, identifying shortages 
and excesses of staff.
 Training of Public Service Officers to be 
improved.
C. Minimise corruption
Why?
Corruption affects economic growth. 
Resources are expended on wasteful 
projects.
Costs and interest rates paid by Government 
are higher.
Consequentially Sri Lanka’s image as a prime 
investment destination is adversely affected. 
How?
Steps should be taken to move toward being 
in the top 50 by 2025 with respect to the 
following indicators: 
 
Incidence of corruption by World 
Economic Forum.
 Corruption Perception Index by 
Transparency International
14 
| WORKING DRAFT 
Fundamental Hygiene 
Factors as a Foundation 
for Sustainable Growth
Key Pillar: Socio-Economic Development
3. Social Inclusiveness is Key for Accelerated Economic Development 
Why?
Sri Lanka has over the years sustained many 
socio-economic programmes and thereby 
achieved satisfactory progress that has 
contributed to the quality of life of our 
people. 
In the next phase of economic development, 
the envisaged increase in national income 
should lead to an improvement of living 
standards for all, particularly of the under-
privileged. 
How?
The development of the economy should 
also lead to improved benefits for workers, 
better work place safety, working conditions 
and facilities. Changes in legislation should 
be innovative, modern and enable social 
inclusion as well. 
5. Restructure of the Labour Force to meet new economic realities:
Why?
As we plug into the Industrial 4.0, there will be 
sectors in the economy that will require macro 
re-engineering. 
How?
This will require carefully crafted policies to 
leverage on modern technology to drive 
productivity within these sectors. 
Further, it may require restructure of the 
welfare system to meet demands of the 
emerging workforce needs. 
4. Sustainability at the Core 
Why?
The development of the economy should not 
be at the expense of sustainability and the 
environment.  It is possible for development 
to take place while preserving and improving 
the environment. 
How?
Key areas for preserving the environment 
include: 
 sustainable management of Cultural 
Sites, National Parks, 
 elimination of one-time-use of Plastics, 
Reforestation,
 minimising pollution through use of 
renewable energy sources,
 and the improvement of Public Transport 
vehicles through better use of Public 
Transport.
SRI LANKA ECONOMIC ACCELERATION FRAMEWORK 2020-25 | 15
Sustainability 
at the Core
The development of the economy should not be at 
the expense of sustainability and the environment. 
Where are 
we now?
#1INDIA#2BANGLADESH#3NEPAL#4SOUTH ASIA2019 F
2020 F
2021 F
7.
5
7.
3
6.
0
6.
9
5.
7
7.
5
7.
4
6.
1
7.
0
5.
2
7.
5
7.
3
6.
2
7.
1
5.
3
World Bank:
https://www.worldbank.org/en/region/sar/overview
SRI LANKA:
3RD SLOWEST GROWTH IN GDP 
IN THE SOUTH ASIAN REGION 
#5MALDIVES#6BHUTAN#7SRI LANKA#8PAKISTAN#9AFGHANISTAN5.
4
3.
5
3.
4
2.
4
5.
4
3.
6
2.
7
3.
2
5.
2
3.
7
4.
0
3.
5
18 
| WORKING DRAFT 
20182018USD 89 Bn
AGRICULTURE,FORESTRY AND FISHING MANUFACTURINGCONSTRUCTIONWHOLESALE ANDRETAIL TRADE4.5
6.3
4.6
7.4
How do WE
GET THERE?
SRI LANKA ECONOMIC ACCELERATION FRAMEWORK 2020-25 | 19
USD 134 Bn
TRANSPORTATIONFINANCIAL SERVICESOTHER SERVICESOTHER INDUSTRIALSERVICESOTHER INDUSTRIALSERVICESTAXES LESS SUBSIDIESON PRODUCTSTAXES LESS SUBSIDIESON PRODUCTS7.8
2.5
7.7
2
2.5
20252025Assumptions:
Average Real GDP Growth rate between 2020 - 2025 - 6.8%
Annual Average LKR Depreciation against USD of 4%
GDP Deflator at 4.5%
A Model 
for Growth
Private Sector
Tax Income
Service Quality & Policy Execution
Investment
Policies
Society
Go
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me
nt
Po
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In
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Ta
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Inc
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Improved margins
Ec
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Gr
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Pro
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Job
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Eco
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ultip
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Pu
bl
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Se
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This model relies on a number of communication 
channels-utilising public relations, media 
and other intermediaries to share material 
information with key stakeholders. 
Po
lic
ies
Co
ns
um
er
 sp
en
di
ng
In
ve
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me
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So
cia
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Improved margins
22 
| WORKING DRAFT 
Tracking The 
implementation 
Progress
Performance Objectives, Indicators, 
Targets and Responsibility
Feedback / Correction / 
Continuous Improvement
CENTRAL GOVERNMENT
LOCAL GOVERNMENT
CITIZEN
INPUT
Annual Work 
Plan
Programme
SRI LANKA ECONOMIC ACCELERATION FRAMEWORK 2020-25 | 23
Measuring Effectiveness, 
Efficiency & Process 
PROCESS
OUTPUT
OUTCOME
Performance 
Monitoring System
economic growth
External Sector
Employment Indicators
HIGH LEVEL 
OBJECTIVES to 
Achieve by
Goals
2018
2025
 GDP Growth
3.2%
8.0%
 Per Capita GDP 
(USD)
4,102
5,773
 Annual Average 
Inflation (CCPI)  
4.3%
3%
Goals
2018
2025
 Exports as a % of 
Imports
53%
100%
 Total FDI as a % of 
GDP
2.4%
5%
 Current A/C 
Balance as a % of 
GDP
- 3.2%
 +1%
 Gross Official 
Reserves 
3.7
6
Goals
2018
2025
 Unemployment %
4.4%
4.0%
 Total employment 
in professional/ 
technical/associate 
professional 
categories 
13%
20%
2025
Fiscal Indicators
Competitiveness
Technology and 
digitization
Improvement in 
corruption indices
Goals
2018
2025
 Tax Revenue as a % 
of GDP
11.9%
18%
 Primary Balance as 
a % of GDP
0.6%
1-2% 
surplus
 Budget Deficit as a 
% of GDP
5.3%
2%
Goals
2018
2025
 Ease of Doing 
Business Rank
100
40
 Global 
competitiveness 
index Rank
85
50
Goals
2018
2025
 Global Innovation 
Index
88
60
Goals
2018
2025
 Corruption 
Perception Index 
by Transparency 
International
89
50
26 
| WORKING DRAFT 
The Way 
We Work
As we set in motion a plan for growth, the Chamber of 
Commerce has in place 18 key Working Groups, across 
several identified verticals and cross-cutting sectors.
The following pages detail the focus areas identified by  
each Working Group, in order to accelerate  
Sri Lanka’s economic growth.
RETAIL
Financial Sector & 
Capital Markets
Health
Transport & 
Logistics
Higher Education
Economy
Tax
Trade
Innovation
SRI LANKA ECONOMIC ACCELERATION FRAMEWORK 2020-25 | 27
Agriculture, Dairy & 
Fisheries
Manufacturing
Tourism
Infrastructure
Exports
Plantations
SME
Power & Energy
Legislation, Regulation Governance
28 
| WORKING DRAFT 
INTERVENTIONS
Lead:
Mr. Suresh Shah,  
CEO/Executive Director, Lion Brewery 
Ceylon PLC and Former Chairman of 
the Ceylon Chamber of Commerce  
Members from the 
Economic Policy 
Steering Committee of 
the Ceylon Chamber.
1. Mitigate Debt Risks
2. Improve Tax Revenue as % of GDP
General economy 
working group 
proposals
SECTOR: General economy
ACHIEVING TARGETS 
SRI LANKA ECONOMIC ACCELERATION FRAMEWORK 2020-25 | 29
IMPLEMENTATIONS
 Establish an  independent Public 
Debt Office/Agency similar to the 
previous Independent Debt Office 
which was first mooted by the 
Government in 2003/4. 
 Enhance CBSL laws and controls 
and continue to issue Treasury 
bills and bonds on behalf of the 
Treasury as an autonomous body. 
The Registered Stock and Security 
Ordinance  and Treasury Bill Act can 
be amended to tighten laws related 
to securities.
 
Implement the Medium-Term Debt 
Management Strategy (2019-2023) 
developed by the Ministry of Finance 
and Central Bank of Sri Lanka. The 
document needs to be updated 
regularly to take into account the 
new developments in the global and 
local economy. 
 
Implement accrual-based 
accounting for Government 
accounts from the current cash 
based accounting system by 2024. 
In the interim period to disclose 
annually the total liabilities including 
guarantees, amounts due for goods 
and services received and subsidies 
committees, pension liabilities and 
amounts due on all leases.
 
Incentivise people to voluntarily 
declare their revenue
 Make opening tax files mandatory to 
broaden the tax net. The NIC number 
can be used as the tax file number.
 Focus on ‘holy trinity ’ of options – 
broadening tax base, lowering rates 
and better administration  
(take learnings from countries such 
as Vietnam and Georgia that have 
been able to improve their tax 
revenue over the last 10-15 years).
30 
| WORKING DRAFT 
INTERVENTIONS
General economy 
working group proposals
SECTOR: General economy
3. Improve FDI and export targets to 5% of GDP 
and 100% of imports respectively by 2025
SRI LANKA ECONOMIC ACCELERATION FRAMEWORK 2020-25 | 31
IMPLEMENTATIONS
 Countries such as Vietnam which 
have improved FDI inflows have done 
so through improvement in the Ease 
of Doing Business ( EODB ranking 
has improved from 99 in 2014 to 
69 by 2019). While taskforces are 
presently established to improve 
each of the ranking in the sub-indices 
of the EODB, this process can be 
institutionalised with a permanent 
secretariat to fast-track the reforms 
required. The Secretariat can be 
created with secondments from the 
respective institutions working on 
improving the index. The Secretariat 
can also look at other non-index 
issues which matter in improving the 
business climate of the private sector. 
 Trade policy that will be outward 
in nature and provide access to 
markets. 
 Unlock some of the bottlenecks 
towards FDI growth such as 
availability on land and labour 
resources.
 Set up specially designed industrial 
zones which reduce bureaucratic red 
tape and provide a plug and play 
model for investment. 
 Consistently promoting an 
environment of policy predictability 
 Review existing bilateral investment 
agreements and renegotiate to 
provide better investment protection 
and enter into new treaties with 
strategically important investment 
partners. These could be coupled 
with Free Trade Agreements (FTAs) 
where necessary.
 
Improve services provided by 
commercial sections of Sri Lankan 
diplomatic missions and strengthen 
commercial sections of some of the 
key and big markets (e.g. China and 
India) with more resources to assist Sri 
Lankan companies (e.g. hiring locals 
with good local knowledge).
32 
| WORKING DRAFT 
General economy 
working group proposals
KEY ACTIVITIES FOR STATE OWNED ENTERPRISE REFORM 
Interventions
Year of Intervention
Develop a communication strategy  that outlines the necessity for reforms of the SOEs.
Immediately 
Convert all commercial entities into limited liability companies. 
Early 2020
The listing rules to apply immediately to all such Commercial entities to improve transparency 
and Governance
Early 2020
List minority stake (up to 49%) of all commercial SOE other than banks to further facilitate 
transparency and improvement of governance. Divesting can be pursued in two to three 
tranches to maximise value. For example 15% in year 1, 15% in year 3 & 19% in year 5.
2020 onwards
Divest non-strategic commercial SOEs completely through a transparent process. 
2020 onwards
Identify the impact of subsidised pricing both in terms of the cost of underpricing and the 
financing cost due to subsiding pricing. Shift the cost of subsidisation, where needed, to the 
Treasury. 
2020
The executive management in SOEs to consist of professionals who have been full time in those 
entities or have experience in such industries. There should be no political appointees in the 
executive management.
Continuous
Bring all SOEs under a holding company. The board of the holding company to be appointed 
by the Constitutional Council. The board would be responsible initially to appoint SOE 
boards. Thereafter, by respective boards with the recommendation of respective nomination 
committees, subject to ratification by the board of the holding company. These directors of the 
holding company and the SOE boards would have qualifying criteria and term limits .
2H 2020
All SOEs including the holding company shall follow accounting standards as stipulated by the 
ICA including the publishing of consolidated accounts.
2021 onwards
SECTOR: General economy
SRI LANKA ECONOMIC ACCELERATION FRAMEWORK 2020-25 | 33
Interventions
Year of Intervention
State banks should be able to extend credit to other SOEs as long as the transaction is at 
arm’s length and has concurrence of the respective RPT committee (of both the bank and  
the SOE).
2020
Develop a strategic plan with KPIs for all SOEs (if it is not available) and the board to be held 
responsible for such implementation.
2020
Avoid conflict of interest and ensure a level playing field for operation by limiting the line 
Ministry ’s role to policy making and regulation. A ministry responsible for regulating an industry 
should not be responsible for managing an SOE in that sector.
2020 onwards
34 
| WORKING DRAFT 
TAX working 
group proposals
TENETS OF TAXATION
BROAD PRINCIPLES
SECTOR: TAX 
Lead:
Mr. Duminda Hulangamuwa,  
Partner, Ernst & Young 
Members of the working 
group:
Ms. Nilanthi Sivapragasam,
Chief Financial Officer,
Aitken Spence PLC
Ms. Shamila Jayasekara,
Partner, Head of Tax, 
KPMG Sri Lanka
Mr. N R Gajendran,
Senior Partner,
Gajma & Co Chartered Accountants
Mr. Naomal Gunawardena,
Partner,
Nithya Partners
Mr. Amal Badugodahewa,
Director, Tax, 
Carson Cumberbatch PLC
Ms. Nisreen Rehmanjee, 
Head of Tax Strategy, 
 John Keells Holdings PLC
Mr. Roshan Anselm, 
Group Tax Manager,
Hayleys PLC
Certainty: Taxes ought to be certain and not arbitrary
Accountability and regular review, tax shifting and 
hypothecation have a role to play 
SRI LANKA ECONOMIC ACCELERATION FRAMEWORK 2020-25 | 35
INTERVENTIONS
 Provide consistency in the tax 
regime in the period leading up to 
2025 and avoid the application of 
retrospective taxes. Maintain existing 
tax rates including the concessionary 
tax rates (e.g. for SMEs, exports 
at 14%) until we move toward an 
equitable tax base. 
 Taxes should be aligned to national 
policy, and essentially be a tool for 
signalling Policy. 
 Establish a think-tank on tax policy 
that will perform rigorous analysis prior 
to implementation of tax policy. It will 
enable the evaluating, monitoring 
and implementation of policy 
initiatives that would be backed 
by research and would hold the 
Government accountable for policy 
actions. The think-tank should also 
have links with the private sector, so 
that policies and projects that are 
cognisant of the private sector would 
be implemented. The think-tank can 
consider policies in addressing the 
challenges in taxation of the digital 
economy, promote policies that 
will provide more positive societal 
behaviour towards protecting the 
environment.
 Hypothecation has an important role 
play in pooling funds for dedicated 
expenditure purposes. Such revenue 
needs to be managed and utilised 
in a transparent efficient manner.
 Create metrics to evaluate efficacy 
of the tax policy. This is vital to win 
taxpayer confidence and gain 
taxpayer “buy-in.”  
 Consultations: Any new tax should 
be opened to the public for a 
reasonable period for discussion 
and debate.
36 
| WORKING DRAFT 
TAX working 
group proposals
INTERVENTIONS
SECTOR: TAX
Mr. Amila Priyadarshana,
General Manager Finance,
Hemas Holdings PLC
Mr. Priyadharshana Ekanayake, 
National Finance Director,
Unilever Sri Lanka (Pvt) Ltd.
Ms. Charmaine Tillekeratne,
Director, Tax Services, 
PricewaterhouseCoopers
Mr. Prasanna de Silva, 
Director, Credit, 
Central Finance Co. PLC 
Mr. Lalith Yatiwella, 
Finance Director, 
Singer (Sri Lanka) PLC
Ms. Thilani Perera, 
Chief Manager, Tax and Finance, 
Commercial Bank 
Mr. Brandon Morris, 
Acting Managing Director, 
Associated Motorways (Private) Limited
Mr. Aruna Deepthikumara, 
Group Chief Financial Officer, 
Commercial Bank of Ceylon PLC 
Mr. Trinesh Fernando, 
General Counsel / Vice President, Group 
Legal and Regulatory, 
Dialog Axiata PLC
Mr. Nilam Jayasinghe 
Group Finance Director, 
Ceylon Biscuits Limited
OTHER INTERVENTIONS 
Equity and fair play in the tax administration
Tax administration and competitiveness
SRI LANKA ECONOMIC ACCELERATION FRAMEWORK 2020-25 | 37
IMPLEMENTATIONS
 Appoint a Tax Ombudsman — presently there are provisions established for this appointment, though it has not been made in the 
last 12 years. Furthermore, authority should be given to strengthen this office by an Act of Parliament. 
Tax regime must be globally competitive 
in efforts to attract new capital, ensure 
progressive outcomes, avoid regressive 
outcomes and be well administered. 
 Establishment of a rational tariff 
structure that promotes the macro-
economic growth objectives of the 
economy. 
 Provide investment incentives for 
anchor investment in sectors that 
have potential to drive export and 
FDI into the country. 
 
Improve tax administration by 
improving capacity of the Inland 
Revenue Department (IRD)
 y Develop industry specific 
knowledge within the IRD
 y
Re-look at the operating structure 
and procedures of the IRD
 y
Improve implementation of RAMIS 
38 
| WORKING DRAFT 
TRADE working 
group proposals
INTERVENTIONS
SECTOR: Trade
Members of the working 
group:
Mr. Husein Esufally 
Chairman, 
Hemas Holdings PLC
Ms. Subhashini Abeysinghe, 
Research Director, 
Verité Research
Mr. Sheamalee Wickramasinghe, 
Managing Director, Ceylon Biscuits Ltd
Mr. Tuli Cooray, 
Secretary General, 
Joint Apparel Association Forum
Dr. Janaka Wijayasiri, 
Research Fellow, 
The Institute of Policy Studies  
Mr. Dinesh de Silva, 
Head of Shipping, 
Unilever Sri Lanka (Pvt) Ltd.
Mr. Nishan Nanayakkara, 
Chairman, The Import Section of 
Ceylon Chamber / General Manager, 
Ceylon Biscuits Ltd.
Mr. Prabash Subasinghe, 
Managing Director, 
Global Rubber Industries and Global 
Seafood
a) Formulation of a national policy directive to address 
structural issues affecting trade.
b) Expansion of Sri Lanka’s trade interests through 
signing of strategic trade agreements [Formulation 
of a ‘Trade Agreement’ (TA) strategy based on the 
fundamentals of ‘maximising gains and minimising 
negative implications’]. 
SRI LANKA ECONOMIC ACCELERATION FRAMEWORK 2020-25 | 39
IMPLEMENTATIONS
 Rational allocation of Government 
departments and ministries to improve 
coordination, coherence, and 
integration in trade policy related 
decision making process.
 Establishment of a rational tariff 
structure that promotes macro-
economic growth objectives of the 
economy. Rationalisation of tariffs is a 
prerequisite for liberalisation of tariffs. 
In the rationalisation process, both 
import duties (both import duty and 
para-tariffs) and export levies need 
to be considered. 
 Establishment of the proposed 
Trade and Productivity Commission 
through a Parliamentary Act with a 
clear mandate to make independent 
and transparent decisions on tariff 
rationalisation based on stakeholder 
consultations and scientific research.
 y
Fixing para tariffs that undermines 
the competitiveness measures 
in order for local industries to 
leverage on liberalisation efforts 
in line with commitments under the 
multilateral trade regime.
 y Develop and implement 
product standards (both quality 
and technical) to safeguard 
legitimate interests and concerns 
of both the consumer and the 
producer. 
 Formulation of a TA strategy that 
clear documents; the process that 
needs to be followed in arriving 
at a decision for negotiation and 
conclusion of the TAs . 
 Trade agreements that Sri Lanka 
becomes party to must be anchored 
to the country ’s national and 
strategic interests, signed after timely, 
transparent and broad-based 
domestic consultations with relevant 
stakeholder groups.
 Conducting feasibility studies that 
informs the potential economic 
impact of the agreements/unilateral 
liberalisations under consideration. 
 Decision to entering into trade 
agreements should not be based 
on narrow considerations or vested 
interests, but must be based on 
good research and evidence taking 
a holistic view of the overall benefits 
to the country. It should be based on 
the outcome of a sound feasibility 
study which also defines the scope of 
the agreement (how comprehensive/
broad the agreement should be).
 Sustaining acquired skills and 
building further technical capacity 
of the negotiating team and the 
supporting team of researches/
technocrats. 
 The capacity of the trade 
agreement negotiating team must 
be strengthened by institutionalising 
the process. It is important to 
ensure sustainability and the 
40 
| WORKING DRAFT 
TRADE working 
group proposals
INTERVENTIONS
SECTOR: Trade
Mr. Saiffudin Jafferjee, 
Managing Director, 
Lanka Garment Manufacturing Co Ltd
Ms. Nadie Kahatapitiya Algama, 
Director Marketing & Strategy, 
KIK Lanka (Pvt) Ltd.
Mr. Anura Warnakulasooriya, 
Director, 
Midaya Ceramic Company (Pvt) Ltd.
Mr. Suresh Ellawala, 
Director, 
Ellawala Horticulture (Pvt) Ltd.
Mr. Jagath Fernando, 
Managing Director, 
Jagro (Pvt) Ltd.              
Mr. Justin Seneviratne, 
Director, 
Lalan Rubbers (Pvt) Ltd.
Mr. Ananda Pathirage, 
Director, 
Hayleys Agriculture Holding Limited
Mr. Ganesh Deivanayagam, 
Chairman, 
Eswaran Brothers Exports (Pvt) Ltd.
Mr. Ashan Refai, 
Managing Director, 
ZAM Gems (Pvt) Ltd.
c) Accelerating reforms to resolve domestic barriers to 
trade and boost competitiveness.
d) Continuity of the implementation of the National 
Export Strategy (NES).
SRI LANKA ECONOMIC ACCELERATION FRAMEWORK 2020-25 | 41
IMPLEMENTATIONS
continuity of the skills acquired 
and experience gained. This will 
build competency of the team 
on negotiating skills while allowing 
specialised skills to be brought in to 
the negotiating team and also to 
build the confidence amongst the 
stakeholders on the process followed. 
The institutionalisation of the trade 
negotiation team will also ensure 
that more structured consultations 
with related stakeholders will 
provide strategic input for ongoing 
negotiations.   
 Scientific approach to formulation 
of offensive/defensive schedules 
for goods and services based 
on statistical analysis, empirical 
research and structured stakeholder 
consultations. 
 y
Building a database with 
offensive and defensive interests 
and skill gaps to supports service 
negotiations
 Entering into Mutual Recognition 
Agreements to promote market 
access gained through tariff 
liberalisation.
 Review/renegotiate existing 
investment and tax treaties and 
negotiate new treaties where 
necessary to improves the investment 
competitiveness of Sri Lanka
 Expediting the implementation of 
trade facilitation measures in a 
transparent manner with a Trade 
Facilitation Agreement (TFA)+ 
approach. Speedy implementation 
of the digital National Single 
Window is the priority action point 
under  Category C TFA measures.
 Speed up accession to the Madrid 
Protocol
 Setting up accredited laboratories 
for certification of export products 
(MRAs can be used as a vehicle 
to facilitate market entry of 
products facilitated by accredited 
laboratories).
 NES lays out a detailed roadmap 
for faster export growth with a focus 
on six focus sectors and three trade 
support functions for all exports 
goods and services. 
 The plan of actions that are 
developed through wide stakeholder 
consultations need to be given a 
focused implementation drive in the 
next five years with flexibility and 
adaptability to timely needs. 
42 
| WORKING DRAFT 
TRADE working 
group proposals
SECTOR: Trade
Other sector specific interventions to spur export growth that are not 
covered by the National Export Strategy
Sector
Intervention
Gem and Jewellery
Establishment of a world class testing and certification centre for the gem and jewellery industry as a 
PPP initiative.
Development of Sri Lanka as a world class trading hub for gem and jewellery.
Rubber
Implementation of the rubber master plan.
Fisheries
Development of Sri Lanka as a reprocessing hub for fisheries exports.  Sri Lanka need to organise as a 
bigger reprocessing arm and, there should be policies in bringing vessels, proper rules for reprocessing 
facilitating investment, etc.
Provide land and promote investment to promote aqua production such as shrimps and prawns. 
Fruits and Vegetables
Permit import of raw material to facilitate reprocessing for exports.
Installing cold storage facilities at airports capable of storing food exports, while preserving their quality 
standards.
Creation of a knowledge and information platform to share information with regard to growing of crop 
such as what to grow, how to grow (inter-cropping, etc.) and when to grow certain crops to optimise 
yield and price.
Tea
Complete automation of Colombo Tea Auction.   
Automation of the supply chain of the tea industry from plucking to selling will provide real time market 
information while enhancing  process efficiency, traceability, eliminate malpractices, better price 
discovery and market information for the stakeholders. 
Establish an accredited laboratory for chemical testing in Sri Lanka to improve the quality of 
infrastructure and promote export standards.
The country has a sizeable outflow of foreign exchange presently to obtain these services from labs 
overseas for testing with cost that ranges from USD 150-200 per sample.
Proper implementation of Global Ceylon Tea campaign in consultation with the tea industry 
stakeholders.
Protect the Ceylon Tea Brand name / Image through registration of Ceylon Tea Geographical 
Indication (GI) in all important out-markets.  
Make GMP mandatory for all tea factories. Introduce heavy penalties for the manufacturers of 
adulterated teas.
Facilitate research and development for generic promotion of tea and tea-based products, such as 
the  potential of tea as a food item, ability to be used in nutraceutical and pharmaceutical industries, 
global flavour on and fragrance industry.  
SRI LANKA ECONOMIC ACCELERATION FRAMEWORK 2020-25 | 43
Trade
Gem and Jewellery
Fruits and Vegetables
Rubber
Tea
Fisheries
44 
| WORKING DRAFT 
INTERVENTIONS
Legislation, Regulations 
and Governance working 
group proposals
SECTOR: Legislation, Regulations and Governance
1.0 Stability of the nation
2.0 Creation of a nation with a Sri Lankan identity
Lead:
Ms. Dilani Alagaratnam,  
President, Group Legal & HR, 
John Keells Holdings 
Members of the working 
group:
Prof. Rohan Samarajiva 
Founding Chair, LIRNEasia & Chairman, 
ICTA
Dr. J.C. Swaminathan 
Partner, Julius & Creasy
Dr. Arittha Wikramanayake 
Precedent Partner, Nithya Partners
Ms. Sabrina Esufally 
Business Development, Senior Manager, 
Morrisons PLC
Mr. Aruna Samarajewa 
Partner, Nithya Partners
Mr. Keerthi Pathiraja 
Company Secretary & Legal Counsel, 
Nestlé Lanka PLC.
Mr. Trinesh Fernando 
General Counsel / Vice President - Group 
Legal and Regulator, Dialog Axiata PLC
SRI LANKA ECONOMIC ACCELERATION FRAMEWORK 2020-25 | 45
IMPLEMENTATIONS
Preservation of National Security 
and Law & Order
(1) Establish a body that is responsible for 
the security and safety of the nation 
akin to the National Security Council, 
which should include as its members the 
president, the prime minister, the relevant 
minister and deputy minister tasked 
with the responsibility for defense and 
law & order. The body should also be 
responsible, inter alia,
(a) to identify a single source of 
communication relating to matters 
of national security, preferably a 
member of the body established 
as aforesaid;
(b) set up a national level threat level 
indicator which is updated, as 
determined by the aforesaid body, 
from time to time and in a timely 
fashion.
(2) Ensure effective enforcement of the 
applicable laws especially, and in 
particular, towards eliminating terrorist 
and violent extremist content online 
in a manner consistent with the rule of 
law and the obligations the country 
has undertaken internationally. In this 
connection we would like to draw 
reference to the Christchurch Call 
to Action, which sets out a well-
considered basis for stakeholder 
engagement and action.
There is a need to integrate diverse 
groups defined by religion, language, 
cultural, social or economic groupings 
to create a Sri Lankan identity, if the 
Nation is to prosper. The Constitution must 
guarantee all groupings and communities 
equality, power sharing whilst preserving 
the supremacy of the Parliament. This is the 
relevant context to the Constitution being 
acceptable to all groups of people in the 
country, which no doubt will result in the 
stability and prosperity of the country.
In this connection sections 291A and 
291B of the Penal Code, which relate to 
2 offences dealing with religious feelings 
should be extended to capture any ethnic 
group or a community.
46 
| WORKING DRAFT 
Legislation, Regulations and 
Governance working group proposals
INTERVENTIONS
SECTOR: Legislation, Regulations and Governance
3.0 Efficient Government administration
SRI LANKA ECONOMIC ACCELERATION FRAMEWORK 2020-25 | 47
IMPLEMENTATIONS
(I) 
It is important that there is a system 
of governance, enshrined in the 
Constitution, which would not result 
in a duality with respect to decision 
making. There must be a single source 
of definitive/authoritative information 
and thus one centre of power as dual 
power centres in the Government is a 
hindrance to development. 
(2) Minsters of the Government, by 
whatever name they are called, should 
be made accountable for the delivery 
of the key objectives of a government. 
 
We recommend that performance 
indicators, in line with Government 
objectives, which are specific and 
measurable be set up for each 
ministry and made public at the 
beginning of every fiscal year and 
the performance against the same 
be considered in allocating funds 
and allocating ministries in the 
ensuing years. The desire is that the 
ministers’ annual performance against 
goals is available to the public and 
that the incumbent Government will 
allocate funds and ministries based on 
performance. 
 
To this end it is recommended that 
all ministers agree with the prime 
minister their scope of work and their 
deliverables, which are specific, time 
bound and measurable. The ministers 
must sign a contract at the time 
they take over the portfolios and it 
must be made public. This measure 
seeks to ensure that the policy of the 
Government in power is executed 
in an orderly fashion, in line with the 
expectations of the voting public.
(3) There should be national policies 
formulated with respect to key areas 
such as education, health, foreign 
investments etc. and these policies 
should not change with changes in 
Government. 
(4) National policies, once formulated, 
should be administered by a set of 
people who are fit and proper and who 
do not change roles based on change 
of governments or ministers. Ensure that 
secretaries to ministries are competent 
and the national policies are carried 
through, untouched by changes to the 
subject ministers. It is envisaged that the 
ministers’ role would be a facilitative 
role and hence will not detract from this 
principle. 
(5) Allocating subjects to ministers should 
be based on merit (fit and proper for 
the delivery of the expectations of the 
portfolio) and not based on seniority 
in the governing party, in parliament or 
otherwise. This will result in more efficient 
use of available resources.
(6)   In determining ministerial portfolios, 
similar subject matter must come 
within the scope of one minister. 
This will assist in making decisions 
that impact the subject matter by 
taking into consideration all relevant 
matters/interests and in a holistic 
fashion. Subjects which are totally 
unconnected should not be assigned 
to a minister.
48 
| WORKING DRAFT 
Legislation, Regulations and 
Governance working group proposals
INTERVENTIONS
SECTOR: Legislation, Regulations and Governance
4.0 Certainty as to the operating framework
5.0 Creation of New Types of Jobs
6.0 Investment Law Regime
SRI LANKA ECONOMIC ACCELERATION FRAMEWORK 2020-25 | 49
IMPLEMENTATIONS
National Budget 
Announcements made in a National 
Budget, which require changes to the 
regulatory regime, should be enacted 
within a time-frame of 30 to 90 days of the 
passing of the National Budget to ensure 
that there is certainty.
To facilitate this draft bills / gazettes 
incorporating changes to tax legislation 
that are to be announced during the 
budget should be compiled and ready 
for submission to cabinet no sooner the 
Budget is passed by Parliament. This would 
ensure that the time lag between the 
budget being presented to Parliament 
and necessary changes to legislation to 
support same is minimised.
Retrospective application of laws
As a general rule enacting laws and 
regulations with retrospective operation 
should be avoided.
Creating an environment in which 
e-commerce thrives
(1) Introduction of a di minimis scheme to 
enable SMEs and e-commerce markets 
as this would encourage and support 
new trading options and reduce 
transaction costs.
(2) To abolish the requirement for manual 
submission of Form 1 and 2 under 
Direction 1 of 2017 under the Foreign 
Exchange Act as it hinders trade 
transactions under documentary 
credits and documentary collections. 
This obligation should be placed on 
the banks to obtain, maintain and 
report the required details. 
(3) Ensuring that the data protection law 
is enacted at the earliest.
(4) Ensuring that cyber security related 
measures are in place. 
(5) Inward remittances for online payments 
 
There is an opportunity loss due to 
the lack of availability of international 
online payment platforms in Sri Lanka 
that will enable businesses to directly  
receive money for goods and services 
provided overseas. This is a low-
hanging fruit that will help the digital 
economy and SMEs in Sri Lanka to 
scale and grow their businesses.
It is important to rationalise the following 
laws towards realising the objectives of 
these statutes.
(1) Amending Schedule B of the Board 
of Investment Act to list the Foreign 
Exchange Act of 2017 in place of the 
abolished Exchange Control Act of 
1953.
(2) Board of Investment Act and Strategic 
Development Acts should be amended 
to include, in the relevant schedules, the 
Inland Revenue Act No. 24 of 2017.
50 
| WORKING DRAFT 
Legislation, Regulations and 
Governance working group proposals
INTERVENTIONS
SECTOR: Legislation, Regulations and Governance
7.0 Intellectual Property Law regime
8.0 Competition Law
9.0 Labour Law Regime
SRI LANKA ECONOMIC ACCELERATION FRAMEWORK 2020-25 | 51
IMPLEMENTATIONS
(1) Enabling legislation consequent to Sri Lanka’s accession to the Madrid Protocol must be put in place.
(2)  Provisions relating to registration Geographic Indications should be enacted.
Sri Lanka presently does not have a law 
for the regulation of competition. When 
the Consumer Affairs Authority Act No. 9 of 
2003 was enacted, it repealed the Fair 
Trading Commission Act No. 1 of 1987 
which had substantive provisions on the 
regulation of mergers and monopolies. 
These provisions were excluded from 
the Consumer Affairs Authority Act with 
the intention that the Government would 
subsequently enact a special law to deal 
with mergers and monopolies. However, this 
was not followed up thereafter, resulting in a 
lacuna in the regulation of competition. 
Consequently, there is no law to deal 
with mergers and monopolies. This poses 
severe threats to maintaining a fair market 
and a level playing field. There are 
several instances where large entities have 
deliberately violated basic principles of 
competition law and engaged in overt 
anti-competitive behaviour due to this 
failure. We believe that this could be 
aggravated in the future with increasing 
competition from large overseas 
conglomerates entering the market. 
Foreign investors are concerned when they 
learn that we have not competition law in 
the country since such laws are standard 
feature in every market even in the region. 
It is therefore imperative that laws be 
enacted for the purpose of protecting 
consumers by creating a balanced 
framework for market behaviour.
Amending the Labour Law regime to 
capture the following in the main based 
on a recognition of the need to generate 
employment, bring women into the work 
force and create a meritocracy. Labour 
laws must promote flexible work and current 
work arrangements such as sub-contracting 
and also strengthen the employer-
employee relationship.
(1) Enable night work for women in a 
controlled environment
(2) Encourage child care facilities based 
on what has been proposed by the 
Government in the recent Budget 
(3) Regulate ‘Contract Labour ’ providers 
as any other employer, being providers 
of a valuable service. 
(4) Facilitate diverse forms of employment 
such as part time work, work from home 
/ distant locations arrangements, 
flexible hours of work.
(5) Enable a five day work week, so as 
to permit businesses to determine the 
hours of work suited for their respective 
businesses.
(6) Ensure that the safety net envisaged 
at the time of the enactment of the 
Termination of Employment (Special 
Provisions) Act is put in place and 
permit businesses to lay off employees 
based on the current compensation 
formula, without a requirement of 
having to obtain the consent of the 
Commissioner of Labour.
(7) Amend the Payment of Gratuity Act, 
Shop and Office Act, etc. so as to 
accommodate concepts such as ‘part 
time work’.
52 
| WORKING DRAFT 
Legislation, Regulations and 
Governance working group proposals
INTERVENTIONS
SECTOR: Legislation, Regulations and Governance
10.0 Land Law regime
11.0 Company Law regime
SRI LANKA ECONOMIC ACCELERATION FRAMEWORK 2020-25 | 53
IMPLEMENTATIONS
(8) Ensure that the proposed Employment 
Law, currently in draft form, be enacted 
at the earliest, after consulting with the 
stakeholders.
(9) Provide an efficient mechanism by 
which foreign labour required in the 
country is permitted work visas. 
(10) Amend existing regulations which 
prohibits spouses of foreign employees 
from working and obtaining facilities 
such as a driving license, as this serves 
as a deterrent to technology transfer 
to locals.
Amendment to the Registration of 
Title Act 21 of 1988 
Sections 33 and 59 of the Act should be 
amended as it provides that no court can 
question the title and change the register 
if possession has been established, unless 
the title has been obtained through 
fraudulent means. This limitation is too 
restrictive and acts to the detriment of the 
affected persons. 
Apartment Ownership Law 
Express provision for horizontal 
condominiumisation should be set out. 
Currently the Condominium Management 
Authority does not recognise the ability to 
use the Apartment Ownership Law in this 
manner is a hindrance to better utilisation 
of land parcels.
Real Estate Investment Trusts (REITs)
Legal recognition for establishment of 
REITs is required to grow and develop 
our property market and realise its full 
potential.
Recording of interests of the State 
in land
Until such time the registration of title 
across the country is completed, which at 
its current pace is likely to take a very long 
time, it is important to have a mechanism 
for recording of State interests, if any, 
with regard to land parcels. Lack of this 
creates many issues to the public at large.
(1) Provisions akin to Chapter 11 in 
the USA are put in place to assist 
companies in distress.
(2) Any modification necessary to Winding 
Up procedure and Administrations 
procedure.
(3) Registration of beneficial owners in 
the case of trust to prevent money 
laundering and other illegal activities 
following trends in company legislation 
in Europe.
54 
| WORKING DRAFT 
Legislation, Regulations and 
Governance working group proposals
INTERVENTIONS
SECTOR: Legislation, Regulations and Governance
12.0 Access to information
13.0 Environmental Law regime
15.0 Laws and regulations currently in draft form
14.0 Alternative Dispute Resolution mechanisms
SRI LANKA ECONOMIC ACCELERATION FRAMEWORK 2020-25 | 55
IMPLEMENTATIONS
Ability to access and download 
documents from a computer system with 
respect to documentation available to 
the public and maintained by Government 
bodies should be facilitated. The 
requirement is acute particularly in relation 
to court records, company registry and 
Intellectual Property Office documentation 
and Land Registry documents. The ideal 
solution is a comprehensive automation of 
the courts.
Sr Lanka must be an e-driven country with 
‘linked databases” which enable process 
driven “transacting” with minimal human 
interaction. This will reduce corruption. 
It is important to proceduralise as many 
transactions as possible, particularly day 
to day transactions, as it will make the 
Government efficient and leave less room 
for corruption.
The law should be strengthened to 
encourage the public to Refuse, Reduce, 
Reuse and Recycle plastic. In this context 
enabling legislative changes to be 
introduced to permit supermarkets to 
charge for the issue of plastic bags, 
a model that has been tested and 
found to be successful in substantially 
reducing the demand for plastic bags by 
consumers worldwide. Currently this is not 
possible due to a regulation issued by 
the Consumer Affairs Authority (CAA) in 
2008 that prevents the same, which the 
CAA is unable to withdraw due as it was a 
regulation made pursuant to a commitment 
made to the Supreme Court of 
Sri Lanka.
The Chamber also recommends that the 
Government takes an inventory of laws 
and regulations
i. 
drafted and awaiting submission to the 
cabinet of ministers for approval;
ii. approved by the cabinet of ministers 
but awaiting final drafts from the Legal 
Draftsman;
 We believe that work already done 
should be resurrected and expedited, 
as these are low hanging fruits and 
would clearly benefit the Ease of 
Doing Business Indices.
 
There is value in identifying the laws 
that are currently in the statute books, 
but are obsolete or have not been 
used in decades and repealing them. 
An effective dispute resolution 
mechanism for commercial disputes is 
essential for economic development. 
Government assistance is requested to 
make Colombo a centre for alternative 
dispute resolution. Governments in the 
region such as Hong Kong, Singapore 
and Maldives, for example, support this 
endeavour by providing infrastructure 
including a suitable venue and resources 
for staffing for the development of the 
dispute resolution centres in their relevant 
countries. Accordingly, we request that 
CCC-ICLP ADR Centre, established 
with the participation of the Ceylon 
Chamber of Commerce, be provided 
with assistance especially in obtaining 
from the Government a venue for holding 
mediations/arbitrations. The proposed 
rules of mediation and arbitration of the 
CCC-ICLP ADR centre seek to address 
the main obstacles for corporates and 
individuals from seeking ADR solutions, 
including the reduction of the time taken 
to resolve disputes and also keeping the 
costs within agreed limits.
56 
| WORKING DRAFT 
POLICY INTERVENTIONS / KEY ACTIVITIES 
Power and 
energy working 
group proposals
SECTOR: Power and Energy
Lead:
Mr. Saliya Wickramasuriya,  
Independent Energy Expert 
Mr. Asgi Akbarally
Director, Akbar Brothers (Pvt) Ltd.
Members are 
constituted from 
the existing National 
Agenda Committee 
of the Chamber on 
Energy
1. 
Restructure and standardise the bidding processes including Request For 
Proposals (RFPs) to increase competition, compare bids accurately, and capture 
maximum long-term economic value.
2. 
Engage professional industry advisory companies to protect national interest 
when evaluating and negotiating energy contracts with international parties, until 
Sri Lankan experts gain capacity.
3.  Mandate the National Procurement Commission (NPC) to perform the functions 
of the Procurement Appeals Board (PAB), so that the appeals process could be 
carried out in an independent and impartial manner.
4.  Allow ‘power wheeling’ within the transmission network. This measure could lead 
to significant investment in power generation by major industries and help in 
achieving the Non-Conventional Renewable Energy (NCRE) generation targets, 
while reducing CEB’s need for generation capacity additions. 
5.  Amend the Electricity Act to exclude the requirement to bid for small-scale NCRE 
projects and implement a ‘Feed-in-Tariff ’ with agreed formulae and periodic rate 
revision. Applications may include a forfeitable bond, and approvals need to be 
time limited. 
6.  
Rationalise short-term LNG imports with upstream development timelines.  Strategic 
LNG imports in the short term through flexible contracts, use of an offshore 
delivery solution (FSRU or FSU+ barge) instead of land-based terminal, would 
be beneficial in balancing imported LNG with possible natural gas production 
in the future.  Ideally, this could be achieved through agreements with institutions 
involved in both exploration and the LNG retail business and by giving control 
of the LNG supply portfolio to the Ministry of Petroleum Resources Development, 
who currently has responsibility for both upstream and downstream gas. 
SRI LANKA ECONOMIC ACCELERATION FRAMEWORK 2020-25 | 57
  7.  Address the lack of an independent regulator in the petroleum. This can be 
achieved through legally empowering the regulator (Public Utilities Commission 
of Sri Lanka) with clearly defined roles and responsibilities. It must further be noted 
that the role of the regulator should ideally be an evolving one.
8.  Develop a technology roadmap for a 100% (renewable/indigenous) grid, utilising 
global expertise to create a notional generation plan for alternative scenarios.
9.  
Phase in unbundling of the CEB based on functionality, with independent 
financial reporting, beginning with independent accounting between generation 
units, transmission licensees, and distribution units. CEB to conduct mandatory 
dispatch audits periodically to ensure transparency and good practices within 
the system. Listing a percentage of State-Owned Enterprises (SOEs) on the stock 
market would also help to increase public oversight and increase accountability.
10.  Attract private sector participation in the sector through public private 
partnerships, including in electricity transmission and distribution.
11.  Introduce Key Performance Indicators (KPIs) aligned with economic and 
environmental goals for the utility companies.
12.  Align generation planning with sustainability goals and in-line with technological 
trends of the sector. Planning should be restricted to a single currency, with a 
sensitivity analysis taking into consideration full social and environmental cost.
Full report with detail interventions can be 
found in this publication -
https://drive.google.com/file/d/1sKFtvI46
pZV9C48rKIrUyMWoS5KwRUaJ/view  
58 
| WORKING DRAFT 
a) Amalgamate NEDA, IDB, and other related public sector 
institutions (such as Small Enterprises Development Division) 
working on the SME sector to create an “SME authority”. This 
which will act as an umbrella organisation, responsible for SME 
policy, advocacy and coordination of proposed island-wide 
one stop shops. The existing staff and resources should be 
utilised without additional burden to Government coffers.
1. Streamline SME development ecosystem and create 
an enabling environment.
INTERVENTIONS
Lead:
Mr. Arjuna Herath,  
Senior Partner E&Y 
Members of the working 
group:
Ms. Samadanie Kiriwandeniya, 
Chairperson, SDB Bank
Mr. Hasitha Wijesundara,  
Senior Advisory, GIZ SME Sector  
Development Programme
Mr. Sujeewa Rajapakse,  
Managing Partner, BDO Partners 
Mr. Jude Fernando,  
Deputy General Manager,  
SME & Midmarket 
Hatton National Bank PLC 
Mr. H. M. S. Lakshman 
Wijeyawardene 
Director, NEDA 
SME WORKING 
GROUP PROPOSALS
SECTOR: SME Development
SRI LANKA ECONOMIC ACCELERATION FRAMEWORK 2020-25 | 59
  Formulate a SME Advisory Council 
under the relevant line ministry, 
as the sole facilitator for the 
establishment of the SME Authority 
(under MOIC), which will consist 
of key representatives of the 
relevant Government ministries, 
institutes, agencies (including 
CBSL), commercial banks, chambers, 
universities and more. 
  Formulate mandatory, statutory 
amendments to the National 
Enterprise Development Authority 
Act, No. 17 of 2006 and Industrial 
Development Act No.36 of 1969. 
Enact a new Act to govern the SME 
Authority, and grant it with exclusive 
mandate and power to serve the 
SME sector. 
  Map out current services and 
develop a detailed plan for 
transforming the existing structures 
and strategies that the selected 
Government institutions practice 
and motivate these institutions to 
adhere with an island-wide SME 
Development Strategy.  
  Pool in qualified resources from 
NEDA and IDB to work for the 
amalgamated entity and, strengthen 
the capacity of the staff on policy 
analysis, performance monitoring, inter 
and intra institutional coordination, 
database management and 
dissemination of information.
  Facilitate provision of information/
guidance for SMEs regarding 
regulatory and institutional 
procedural requirements in carrying 
out their businesses through the 
website of the SME Authority.
IMPLEMENTATIONS
60 
| WORKING DRAFT 
INTERVENTIONS
b) Establish  district level “one stop shops” as a focal point of 
assistance for SMEs to coordinate and facilitate service deliveries 
including, but not limited to licensing, registration, and business 
development services (using the existing resources).
c) Develop a centralised SME database
d) Establish a common SME definition that is excepted by all institutions 
and policymakers 
SME WORKING 
GROUP PROPOSALS
SECTOR: SME Development
SRI LANKA ECONOMIC ACCELERATION FRAMEWORK 2020-25 | 61
IMPLEMENTATIONS
  SME Authority to coordinate 
the programmes of multiplicity of 
agencies serving and assisting SMEs 
at a regional level by pooling in 
resources from government institutes 
(such as NEDA, IDB, SED, Vidhatha 
Centres), establishing a clear 
communication line and provisioning 
of solid training to selected staff.
  Develop a consultative body with 
the potential private agencies/
organisations (including business 
consultants and banks) to be 
involved in service and information 
provision at the one stop shops, 
specially to facilitate business 
development services. 
  Technologically enable the one 
stop shops by way of a dedicated 
portal to allow SMEs to direct their 
requirements online through an 
application, which will ultimately get 
directed to the respective agency 
in order for timely and quality service 
delivery.
  Carry out a census to collate the most recent information on SMEs which will then be used by the proposed authority  in decision 
making and work of initiatives such as the one stop shops. 
  The SME Authority to take required steps to ensure the national level definition is being followed island-wide by all the parties. The 
Authority will also take actions to revisit the national SME definition once in every three years based on the economic and business 
development in the country (unless there is a major change in the economic structure). 
62 
| WORKING DRAFT 
INTERVENTIONS
2. Improve access to finance for SMEs
3. Facilitate SME access to markets
SME WORKING 
GROUP PROPOSALS
SECTOR: SME Development
SRI LANKA ECONOMIC ACCELERATION FRAMEWORK 2020-25 | 63
IMPLEMENTATIONS
 Establish a “Credit Guarantee 
Institution”, under the CBSL, as a 
channel for SMEs to access credit 
facilities from lending institutions 
(commercial banks) without a 
collateral, at a reasonable rate. 
 y Complete required regulatory 
amendments to support the 
establishment of the credit 
guarantee institution.
 y Use the mechanism of PPP, where 
CBSL will act as the funding 
and monitoring entity, whilst the 
lending institutions will provide 
SME funding  accepting the 
guarantee provided.
 Establish a separate SME (unit) within 
regional development department of 
CBSL for regulation of SME loans
 Set up a long-term SME Loan Fund, 
with the donor community support 
(donations, gifts, grants), loans or any 
other source of funding, administered 
by the CBSL SME Unit.
 Create a linkage between banks 
and suggested one stop shops, as a 
platform for SMEs to link with banks to 
resolve their access to finance issues. 
 Uplift equity financing mechanisms for 
the SMEs through incentivising setting 
up venture capital mechanisms 
at District level (channel funds 
on concessionary terms to VC 
companies, tax concessions).
 Provide regulatory incentives to 
encourage banks to increase 
lending to SMEs (eg; reduce risk 
weightage of lending to SMEs)
 
Increase exports by SMEs by 20% 
over the period of three years.
 Formulate effective Government 
policies to create linkages and 
facilitate market for goods and 
services of SMEs.
 y
Public sector retail shops to 
dedicate certain amount of shelf 
space specifically for SMEs.
 y
Facilitate large private 
corporates to create linkages 
with SMEs.
 Upgrade and popularise SME.lk as 
an effective portal for SME trade, 
which will also facilitate e-commerce.
 Enhance opportunities for SMEs 
to participate in foreign trade 
promotion exhibitions.
 Organise regular SME trade fairs 
through PPP. 
 Support SMEs to  gain e-marketing 
skills and promote e-marketing/e-
commerce.
64 
| WORKING DRAFT 
INTERVENTIONS
4. Scaling up SMEs
5. Entrepreneurship and skills development with a 
focus on women’s entrepreneurship - Scarcity of 
skilled workers in SMEs has been a major issue. The 
sector is struggling to attract trained workers and 
to retain skilled workers for efficient and high-quality 
production and service delivery.
SME WORKING 
GROUP PROPOSALS
SECTOR: SME Development
SRI LANKA ECONOMIC ACCELERATION FRAMEWORK 2020-25 | 65
IMPLEMENTATIONS
 Upon establishing the SME 
database, look at targets to 
elevate a certain %  of SMEs in each 
category (micro, small, medium) to 
the next category 
 Establishment of SME specific 
industrial zones.
 Promote business incubation through 
SME Authority and one stop shops.
 Create / update  a registry of all 
SME training / business development 
services providers.  
To overcome these:
 Expand vocational training with the 
support from the private sector
 y Allocate more resources for the 
vocational training institutes 
 y
Timely update the curricula of 
vocational training to suit the 
changing economic requirements
 PPP training arrangements with some 
tax incentives for private sector 
engagement.
 Loan facilities at concessionary rates 
for training and development under 
strict supervision.
 Encourage universities and other 
tertiary sector institutions to provide 
training support for SMEs.
 Promote industry specific technical 
training jointly with sub sector specific 
institutions (e.g. Gem and Jewellery 
Institute)
 Presently there is a low female labour 
force participation in the workforce 
that is not  utilised for the economic 
development in the country. Lack 
of social acceptance, technical 
know-how, finance facilities, access 
to networks, access to and influence 
policy makers are some issues 
faced by women entrepreneurs. The 
aforementioned implementation 
initiatives should be implemented with 
focus given towards women. 
Innovation and 
Digitisation working 
group proposals
SECTOR: Innovation and Digitisation
 
 
Consumer
Export
Private Sector
Import
Manufacturing 4.0Logistics and TransportAgriculture 4.0Livestock/Aquatic 4.0Construction 4.0Tourism 
 
 
 
 
 

Digital Identity / Authentication
Capacity Building (STEM)
Public Sector
Domestic
Downstream Enablers
Banking and FinanceHealthcare 4.0Retail 4.0Etc.Digital/E-commerce and Payments
E-Government - Tax, Customs, Law & Order
Industry 
4.0
Upstream Enablers
Industry 4.0 Platforms
GDP
Big Data, Analytics and AI
IoT Platforms (device and vertical independence)
Cloud Infrastructure - Compute, Storage
Broadband and Connectivity Infrastructure (4G, WTTX, FFTX, 5G, etc.)
68 
| WORKING DRAFT 
Innovation and Digitisation 
working group proposals
SECTOR: Innovation and Digitisation
KEY ACTIVITIES
Interventions
 Establish global payment platforms in Sri Lanka such that there will be an increase in electronic payment penetration from the current 47% 
(2015) and more SMEs will be able to connect with the digital marketplace. 
 Develop a policy framework to implement national strategy for Big Data Analytics and AI. The proposed policy should establish 
horizontalised data convergence strategy to share data between public and private sector entities. 
 
Implementation of existing policy strategy documents in consultation with the private sector such as:
1. 
Innovation and Entrepreneurship Strategy of Sri Lanka 2018-22
2. 
National IOT roadmap
3. 
Proposed National Digital Economy Strategy with the thrust sectors of agriculture, tourism and manufacturing.
 
Implement digital ID system with the necessary data protection legislation in place to seamlessly connect with its citizens to offer services 
such as banking, health and payment of taxes.
SRI LANKA ECONOMIC ACCELERATION FRAMEWORK 2020-25 | 69
Connecting 
Sri LANKA THROUGH 
Innovation and 
Digitisation
70 
| WORKING DRAFT 
 y
Implementing the Public Investment Committee (PIC) or an equivalent 
high-powered committee to take over the role of selecting, 
prioritising and creating a pipeline of infrastructure projects drawn 
from varied line ministries based on economic and/or financial 
feasibility. 
 y
The PIC should decide on mode of funding for project (e.g. 
Consolidated fund, external resources/multilateral donor funding, 
FDI/PPP and variants thereof)
 y
Ensuring consistency and continuity of the priority project pipeline 
is important to ensure the required economic and social objectives 
are met.
INTERVENTIONS
Lead:
Mr Pravir Samarasinghe,   
CEO, Overseas Realty Ceylon PLC 
Members of the working 
group:
Mr. Kamal Dorabawila, 
Principal Investment Officer, 
International Finance Corporation
Mr. Thilan Wijesinghe, 
Chairman, National Agency for PPP, 
Ministry of Finance
Mr. Christopher Joshua, 
Managing Director, 
Access Engineering PLC
Mr. Lakshman Jayasekara, 
Project Director, Team Leader, 
Western Region Megapolis Master 
Plan Project
Mr. Rohan Tudawe, 
Chairman, 
Tudawe Brothers (Pvt) Ltd.
Infrastructure 
working group 
proposals
SECTOR: Infrastructure 
1. Prioritisation of Infrastructure Projects 
The lack of fiscal space owing to high debt repayment (82.9% of GDP) 
has led to significantly low levels of Government capital expenditure on 
Infrastructure. 
2. Infrastructure Financing Policy
SRI LANKA ECONOMIC ACCELERATION FRAMEWORK 2020-25 | 71
 Draw up a robust project pipeline 
through  the Public Investment 
Committee (PIC) or equivalent 
institution.
 PIC or the equivalent should have 
the secretary to the Treasury acting 
as the chairman of the committee; 
as the planning, allocation and 
management of public finances are 
under its purview. The related line 
ministries should also be represented 
in this committee.
 Broadly functions of a PIC or the 
equivalent institution should include:
 y
To evaluate projects with clearly 
defined parameters based on 
the merits of economic, financial 
and social factors, so that there 
will be a prioritised permanent 
list of projects over a three - five 
year horizon with their identified 
funding mechanisms (public, 
private and PPP).
 y
To examine whether projects are 
being managed in accordance 
with sound business principles 
and prudent commercial 
practices throughout the projects 
lifespan.
IMPLEMENTATIONS
 Policies to attract private funding 
should be encouraged and the 
newly formed  National Agency for 
Public-Private Partnership (NAPPP) 
should be facilitated with sufficient 
authority and guidelines to implement 
PPPs.
 The NAPPP can play the role of 
an intermediary who structures the 
private public funding mechanism 
and looks at the long-term agreement 
with the parties concerned where 
project quality and delivery targets 
are established. The NAPPP can 
also tap into a variety of innovative 
sources of project financing. 
 
In other countries PPPs have been 
successfully executed in providing 
physical infrastructure and non-
specialist services for education and 
health.
72 
| WORKING DRAFT 
INTERVENTIONS
Infrastructure 
working group proposals
SECTOR: Infrastructure 
3. Funding mechanism for feasibility and  
assessment studies
Enabling the procurement process to be competitive and transparent 
without placing further pressure on fiscal consolidation. 
4. Improving the procurement process
SRI LANKA ECONOMIC ACCELERATION FRAMEWORK 2020-25 | 73
IMPLEMENTATIONS
 Feasibility studies or viability 
assessments should be done prior 
to commencement of projects in 
order to identify projects based on 
economic impact, social impact and 
financial viability. By doing this, it will 
also identify the most appropriate 
funding mechanism.
 The costs of the study must be 
commensurate with the costs of the 
planned investment.
 A long-term arrangement should 
be in place, to fund and facilitate 
viability assessments or feasibility 
studies.
 
Identification of specific risks 
associated with projects using 
a technical framework. When 
considering PPPs, risk allocation 
must be carried out via a formal 
mechanism provisioning optimum 
levels of risk to both private and 
public sector. If appropriate risks are 
not addressed in the formulation 
stage projects would end up being 
costly for society.
 Fast-Tracking the PPP procurement 
guidelines which is currently under 
review by the National Procurement 
Commission.
 Fine-tuning the general procurement 
guidelines and ensuring all ministries 
follow these guidelines when 
procuring without giving rise to 
prolonged  delays.
 Reduce time committed to obtaining 
multiple ministry and stakeholder 
approval and need to manage 
logistical and practical issues in 
convening and decision making 
in procurement committees; and 
strengthen technical capability within 
procurement committees to evaluate 
large-scale projects.
74 
| WORKING DRAFT 
Infrastructure 
working group proposals
SECTOR: Infrastructure 
Public Investment
Lack of fiscal space in Sri Lanka acts as a bottleneck in getting the required infrastructure for the country. This calls for the private sector 
involvement in facilitating these investments. Therefore, funding mechanisms (private funding, public funding and PPP) were classified under each 
sector, to identify which sectors can go under the different funding mechanisms. 
Sector
Private Funding
Public Funding
PPP
Roads and Highways


Railway



Aviation


Ports and Shipping 



Housing and Urban Development / Regeneration



Waste Management



Communication Services


Power and Energy



Water



Physical Infrastructure in Education and Health



Sewage


SRI LANKA ECONOMIC ACCELERATION FRAMEWORK 2020-25 | 75
PUBLIC 
INVESTMENT
 y Roads and Highways
 y Railway
 y Aviation
 y Ports and Shipping 
 y Housing and Urban Development / Regeneration
 y Waste Management
 y Communication Services
 y Power and Energy
 y Water
 y Physical Infrastructure in Education and Health
 y Sewage
76 
| WORKING DRAFT 
INTERVENTIONS
 y
Reduce the negative impact on the banks’ liquidity, credit risk 
and administrative difficulties in lending to the priority sectors and 
encourage the banks to lend to the priority sectors.
 y Currently, interest subsidy schemes and other sector reforms are 
implemented by multiple government authorities and banks are 
eligible to receive interest subsidy for the loans granted by them 
through a relevant interest subsidy scheme. Dealing with multiple 
government authorities with different operating procedures and 
objectives increase the operational complexities for banks.
 y
The interest subsidy is provided only for the preforming facilities and 
in the event of default, the banks are required to absorb the total 
credit risk.
 y
These interest subsidy schemes are implemented to compensate the 
cost of funds of banks while encouraging them to grant loans to the 
specific priority sectors of the economy. However, unusual delays in 
receiving the interest subsidy increases the operating cost of the 
banks and discourage banks to participate in such schemes. 
 y
The banks are required to classify lending to Government sponsored 
projects due to delay in payments by the Governments, discouraging 
banks from lending to Government sponsored projects and priority 
sectors.
1. Lending to priority sectors
Financial Sector and 
Capital markets working 
group proposals
SECTOR: Banking
Lead:
Mr Ravi Abeysuriya,    
Group CEO, Candor Equities Ltd. 
Overall:
Mr. Krishan Balendra, 
Chairman, 
John Keells Holdings PLC
Ms. Ayomi Aluwihare, 
Partner, 
F J & G de Saram
Ms. Ruvini Fernando, 
Director, PPP and Deal Strategy, 
PricewaterhouseCoopers
Members of the Banking 
Group :
Mr. Dimantha Seneviratne, 
CEO, 
National Development Bank PLC
Mr. Rajive Dissanayake, 
Chief Strategy Officer, 
Hatton National Bank PLC
SRI LANKA ECONOMIC ACCELERATION FRAMEWORK 2020-25 | 77
IMPLEMENTATIONS
 
Introduce a new framework for 
all interest subsidy schemes and 
other sector reforms to minimise 
the operational complexities of 
dealing with multiple authorities 
and delay in recovering the interest 
subsidies. To achieve this objective, 
all interest subsidy schemes should 
be coordinated, facilitated and 
implemented through CBSL..
 
Implement credit guarantee schemes 
with a view to mitigate credit risk of 
the loans granted by the banks for 
specific sectors under theses schemes.
 Possible relaxations to the NPA 
classification requirements for the 
loans granted to Government 
sponsored projects.
78 
| WORKING DRAFT 
INTERVENTIONS
Financial Sector and Capital 
markets working group proposals
SECTOR: Banking 
 y
Reduce the high cost of bank intermediation by addressing the 
delays in the legal system and introducing the required bankruptcy 
laws. 
 y
Facilitate evolution of the financial services industry based on 
regional/global trends by passing requisite legislation
 y
Recovery and arbitration proceedings tend to be very time 
consuming, expensive and protracted with delays.
 y
The most significant impediment seems to be the willingness of judges 
to grant postponements on basis of ‘personal reasons’ of lawyers 
representing litigants. This delays proceedings with commercial loss 
to parties and great disrepute to all concerned.
 y
Bring inclusive economic growth, regional development, employment 
generation and poverty reduction through increasing the lending to 
SME sector.
 y
Lack of information infrastructure for SMEs
 y Non-availability of a deep SWAP market to hedge the currency risk 
of foreign borrowing for SME lending.
 y
Higher risk premium in loan formulations due to lack of collaterals. 
2. Financial laws
3. Development of the SME sector
Mr. Stuart Rodgers, 
Country Head of Commercial Banking, 
HSBC
Mr. Lakshman Silva, 
CEO, 
DFCC Bank PLC
Mr. Ravi de Silva, 
Secretary General, 
Sri Lanka Banks’ Association
Members of the Capital 
Markets Group: 
Mr. Mafaz Ishaq, 
Director, 
Calamander Capital
Mr. Nishantha Hewavithana, 
Head - Research & New Products, 
Colombo Stock Exchange
Mr. Nissanka Weerasekara, 
Independent Private Equity Investment 
Advisor 
Mr. Senaka Kakiriwaragodage, 
Managing Director, 
NDB Zephyr Partners Lanka (Pvt) Ltd.
Mr. Ruwan Perera, 
President, 
The Unit Trust Association of Sri Lanka
Mr. Prashan Fernando, 
President, 
Colombo Stock Brokers Association
Mr. Maninda Wickramasinghe, 
Country Head, 
Fitch Ratings Lanka
SRI LANKA ECONOMIC ACCELERATION FRAMEWORK 2020-25 | 79
IMPLEMENTATIONS
 Re-examine the recovery laws 
and enactment of legal reforms for 
efficient implementation of recovery 
laws such as 
1. 
Courts to complete commercial 
cases within set time limits.
2. 
Expedite resolving of commercial 
disputes through a smoother 
and more effective arbitration 
process
3. 
Introduce a mechanism for 
speedily restructuring of 
companies facing financial 
difficulties and strengthen 
debt-recovery laws by plugging 
the loopholes that allow the 
defaulters to obtain restraining 
orders from courts and drag 
the commercial cases for long 
periods.
4. 
Enact the required bankruptcy 
laws 
5. 
Establishment of special 
bankruptcy / debt recovery 
courts which handle only debtor-
creditor cases
6. 
Convergence of CBSL 
provisioning calculations with 
IFRS requirements to avoid 
administrative complexities.
 Appoint an official receiver whose 
office should be strengthened 
by adequate resources and 
independence to operate to 
expeditiously contain the decline 
of a company in trouble and to 
rehabilitate them where possible.
 Take initiatives to broaden the SWAP 
market through SWAP arrangements 
with CBSL for borrowing made by 
banks for SME lending.
 Permit the development of a long-
term inter bank SWAP market by 
removing the existing regulatory 
barriers.
 Expedite of the project on 
providing borrower rating from 
CRIB and extending obtaining 
credit information relating to utility 
companies 
80 
| WORKING DRAFT 
INTERVENTIONS
SECTOR: Banking 
 y Credit growth the banking sector is highly impacted by the following. 
1. 
Implementation of BASEL III,  which requires a substantial 
increase in capital base
2. Adoption of IFRS 9,   likely to impair the capital base of the 
banks 
3. A substantial portion of profits of a bank will be netted by the 
state by way of taxes which will significantly affect the banks 
ability to lend
4. Difficulties in attracting capital due to low performance in the 
capital market to meet the new capital requirements
5. Difficulties in raising funds due to low investor confidence due to 
excessive taxes on the industry, highly volatile tax policies such 
as retrospective taxes (Super Gains Tax, introduction of new tax 
treatments for existing investment securities).
4. Slow down of economic growth due to reduction in 
credit supply
Financial Sector and Capital 
markets working group proposals
Members of the Non-bank 
& Financial Institutions 
Markets Group:
Mr. Roshan Abeygoonewardena, 
Chairman, The Finance Houses 
Association of Sri Lanka
Mr. Krishan Thilakarathne, 
Immediate Past Chairman, 
The Finance Houses Association of 
Sri Lanka
Mr. Romani de Silva, 
Member, The Finance Houses 
Association of Sri Lanka
Mr. Brandon Morris, 
Member, The Finance Houses 
Association of Sri Lanka
Mr. Rohan Tennakoon, 
Member, The Finance Houses 
Association of Sri Lanka
Mr. Ravi Yatawara, 
Member, The Finance Houses 
Association of Sri Lanka
Mr. Chaminda Hettiarachchi, 
Member, The Finance Houses 
Association of Sri Lanka
Mr. Ravi Tissera, 
Member, The Finance Houses 
Association of Sri Lanka
Mr Denzil Mallawa Arachchi, 
Head of Secretariat, The Finance 
Houses Association of Sri Lanka
SRI LANKA ECONOMIC ACCELERATION FRAMEWORK 2020-25 | 81
IMPLEMENTATIONS
 Possible relaxation or deferment of 
new capital requirements such as 
counter cyclical buffer.
 Consistent policy framework on banks 
taxation and a long-term view in 
application of banks taxes and 
tax rates.
 Possible relaxations to the existing 
banking tax structure (eg. Debt 
Repayment Levy).
 Avoidance of retrospective taxation.
82 
| WORKING DRAFT 
INTERVENTIONS
SECTOR: Banking 
 y
Enhance the guidelines governing banking operations to strengthen 
the banking sector.
 y
Bring long-term productivity and efficiency  through reduction in 
cost, efficiency gains, economy of scale, enhancement of consumer 
base and innovations.
 y Non availability of clear policy framework on voluntary 
consolidation to motivate the banks on voluntary mergers 
addressing  on issues such as branch closers, implication of 
consolidation on employment, tax treatment, etc.
 y
Introductions of new technology will be important as cost to income 
(C/I) to be a critical factor in the future in improving the profitability 
of banks.
 y
Slow adoptability of the regulator for the new technology and 
difficulties in obtaining approvals.
 y
High costs on technology due to non availability of cloud computing 
 y Non-availability of common data centres.
5. Sector consolidation and re-capitalisation
6. Technology 
Financial Sector and Capital 
markets working group proposals
SRI LANKA ECONOMIC ACCELERATION FRAMEWORK 2020-25 | 83
IMPLEMENTATIONS
 
Introduce a policy framework that motivates the voluntary consolidation within the banking sector addressing requirements such as 
ownership control and degree of foreign ownership allowed, capital requirements and capital treatments, asset liability transfers, 
tax benefits and tax treatments, asset liability transfers, etc. 
 CBSL to facilitate e-KYC through Face-Recognition Apps to facilitate e-banking
 Establish a policy framework on cloud computing, common data centres, digitalisation and fin-tech 
84 
| WORKING DRAFT 
INTERVENTIONS
1. Enable the provision and regulation of demutualised 
exchanges
2. Enact Securitisation Act
3. Establish a Central Counterparty Clearing House 
(CCP) system 
4. Steps to increase market size in the capital market
Financial Sector and 
Capital markets working 
group proposals
SECTOR: Capital Markets 
SRI LANKA ECONOMIC ACCELERATION FRAMEWORK 2020-25 | 85
IMPLEMENTATIONS
 The SEC Act has to be amended 
to include provisions enabling 
demutualisation.
 A Demutualisation Act has to be 
enacted.
 Provisions for civil sanctions against 
securities law violations,
 Licensing and regulation of 
derivative and commodities 
exchanges, 
 
Incorporating legal duties on 
auditors in respect of capital market 
offences,
 Enhancing of measures for investor 
protection.
 Provide a comprehensive legal and regulatory foundation for securitisations in Sri Lanka.
 Essential that the infrastructure for 
such a system is in place.
 To ensure the continuity of a CCP 
system, the SEC should take the role 
of being the primary regulator and 
enforcer.
 Listing State-Owned Enterprises which 
would result in better governance 
and its recognition to the market, 
thus expanding the potential of the 
equity market.
 Listing of minority stakes of key 
commercial public enterprises.
 Dollar board: Establish a dollar 
board for listing of foreign and 
domestic companies.
86 
| WORKING DRAFT 
INTERVENTIONS
SECTOR: Capital Markets 
5. Steps to increase market liquidity
6. Increase transparency and liquidity in Government 
securities
8. Development of Real Estate Investment Trusts
7. Increase transparency and liquidity in the Corporate 
Debt market
Financial Sector and Capital 
markets working group proposals
SRI LANKA ECONOMIC ACCELERATION FRAMEWORK 2020-25 | 87
IMPLEMENTATIONS
 Continue to enforce a higher free 
float percentage.
 Establish a market making mechanism 
to ensure a continuously liquid market 
for listed stocks.
 
Implementing  “market makers”  to 
promote liquidity in the market
 Reforming the transaction cost 
structure with the objective of 
lowering them to an appropriate 
level. 
 
Implement a brokerage industry 
consolidation plan where market 
intermediaries deal in all capital 
market products. 
 Sri Lanka needs to introduce minimum 
capital requirements for market 
intermediaries in the CSE.
 Developing a reliable benchmark 
yield curve across the entire term 
structure. 
 Practices such as private placements, 
partial filling of offered amounts, 
outright cancellation or rejection of 
announced auctions, etc. must be 
limited to exceptional circumstances.
 A more transparent and efficient 
trading platform for Government 
securities must be established. 
 Ensure that it receives support 
from local regulatory bodies and 
authorities in formulating a legislative 
framework for its operations. 
 Fast track the implementation of  
Collective Investments Scheme (CIS) 
code. Alternatively, enable REITs under 
the Unit Trust code as a first step until 
the CIS code is implemented. 
 A stable tax regime must be kept in 
place to instill confidence in investors 
and enabling them to be tax neutral. 
 
Increasing the size of the listed 
corporate bond market is vital by 
increasing the institutional investor 
participation.
 
Introducing a formal market making 
mechanism.
 A central counterparty clearing 
and settlement system is an 
essential component to mitigate 
settlement risks and promote investor 
confidence.
 
Introducing repurchase agreements 
(repos) on corporate debt securities.
 
Introducing bond derivatives will also 
contribute to the development of the 
market. 
88 
| WORKING DRAFT 
INTERVENTIONS
SECTOR: Capital Markets 
9. Establish derivative market
 
(A derivative is a financial contract with a value that 
is derived from an underlying asset)
11. Broaden pension fund portfolio
12. Increase awareness of unit trusts 
10. Introduce commodity derivatives
Financial Sector and Capital 
markets working group proposals
SRI LANKA ECONOMIC ACCELERATION FRAMEWORK 2020-25 | 89
IMPLEMENTATIONS
 Regulations for introducing 
derivatives products needs to be 
developed. 
 Trading, clearing and settlement 
technology and mechanisms need to 
be developed. 
 Sri Lanka needs to undertake a 
comprehensive assessment and 
prepare a realistic road map for 
developing derivatives products and 
markets.
 The SEC and CSE should also link 
the initiatives for increasing the size 
and liquidly of the stock market to the 
development of derivatives. 
 The CBSL, SEC and CSE should 
explore the potential for introducing 
derivatives on Government securities. 
 Pension funds should consider 
creating more broadly diversified 
portfolios. 
 Pension funds should consider 
strengthening the capacity for in-
house fund management. 
 Pension industry should consider 
incorporating external fund 
management into their portfolio, by 
doing so, the public have a choice 
as to invest in the internally-managed 
EPF and ETF or a privately-managed 
pension fund. 
 Setting up of a separate “Pensions 
Office” or regulator to formulate 
and monitor the framework required 
to enable private participation in 
pension fund management.
 The unit trust industry needs a 
comprehensive plan for educating the 
public about benefits of unit trusts. 
 Pension reforms needs to include 
external fund management of 
pension funds. 
 The unit trust industry will need 
consolidation.
 Review the existing taxation framework 
for unit trusts and make appropriate 
changes for the operation of and 
investing in unit trusts.
 A SEC-mandated robust licensing 
framework for professionals in that 
industry.
 Assess the economic and practical 
feasibility of setting up commodities 
trading. This might involve leveraging 
on the existing capacities of the CSE 
to commodities trading.
 The development of trading, clearing 
and settlement structure.
 The SEC should consider the 
need for a separate commodities 
legislation.
90 
| WORKING DRAFT 
INTERVENTIONS
 y An apex committee should be set up and tasked with policy 
development and include key stakeholders and key decision makers.
 y
There needs to be regular (preferably monthly) forums where 
the committee meets to discuss policy direction and latest 
developments.
 y
Regulator looks from a regulatory perspective and not from a 
development approach. As such there is a conflict of interest for a 
regulator as they can formulate policy to make regulation easy at 
the cost of economic development.
 y Government and regulatory policies on limiting the risk taking 
abilities of the industry will negatively affect on credit granted 
to risky sectors and will simulate lending for such sectors through 
unregulated institutions. 
 y
There should be consistency in policies set out for the sector.
1. Policy development
2. Decoupling the regulator and policy developer
Financial Sector and 
Capital markets working 
group proposals
SECTOR: Non-bank & Financial Institutions 
SRI LANKA ECONOMIC ACCELERATION FRAMEWORK 2020-25 | 91
IMPLEMENTATIONS
 
Industry bodies should be 
represented in the committee in order 
to obtain their insights and address 
any concerns.
 Representatives from departments 
important to the NBFI sector such as 
Land Registration, RMV, legal system 
representatives should be members 
of the committee. 
 Ministry for Economic Development 
should drive the formulation of 
policies for the ultimate growth 
and development of the country 
and, should not be influenced by 
regulatory constraints.
 
Institutions should be allowed to take 
on risk and manage it. 
 Minimise inconsistencies between 
economic policies and regulatory 
guidelines.
92 
| WORKING DRAFT 
INTERVENTIONS
SECTOR: Non-bank & Financial Institutions 
 y Maximum interest rate on deposits. As per the new direction the 
interest differential between NBFI and banks have reduce to 0.50% 
to 1.50%. Low interest differential has resulted liquidity strain to most 
of the NBFIs as the deposits are been shifted to banks as the interest 
premium is less considering the credit rating of each company. 
Accordingly, the credit flow to the SME sector could be limited. 
 y NBFIs are catering to a risky segment and the repayment behaviour of 
such customers are different to banking customers (significant potion 
of recoveries are made after 90 days). The proposed regulation on 
NPA classification of 90 days will affect adversely on granting loans 
to risky sectors such as SMEs as significant amount of current customers 
may have to be arbitrary classified be classified as NPAs. 
 y
Lack of Information Infrastructure for SMEs
 y
Higher risk premium in loan formulations due to lack of collaterals. 
 y
Reduce the high cost of NBFIs intermediation by addressing the 
delays in the legal system and introducing the required changes to 
the recovery laws. 
 y
Facilitate evolution of the financial services industry based on 
regional/global trends by passing requisite legislation.
 y
Recovery and arbitration proceedings tend to be very time 
consuming, expensive and protracted with delays.
3. Development of the SME sector
4. Financial Laws
Financial Sector and Capital 
markets working group proposals
SRI LANKA ECONOMIC ACCELERATION FRAMEWORK 2020-25 | 93
IMPLEMENTATIONS
 Facilitate a market-based deposit 
rates based on the credit ratings of 
the respective entities or widen the 
spread in deposit rates between 
banks and NBFIs.
 Delay the implementation of the 
NPA 90-day classification. This is 
to be done on a staggered basis 
over a four-year period and up to a 
minimum of 120 days considering the 
sector specific operational model.
 Re-examine the recovery laws and 
enactment of legal reforms for efficient 
implementation of recovery laws  
such as 
1. 
The laws to be introduced with respect 
to private money lenders and with 
respect to exorbitant lending rates 
and unethical collection practices. 
2. 
Mortgage of leased vehicles to third 
parties: make it a criminal offence under 
a new provision to be introduced to 
the Finance Leasing Act, on par with 
section 15 and 19 of the Consumer 
Credit Act 29 of 1982 
3. 
Mediation board activities to be 
streamlined in a manner which would 
help the recovery activities to be  
more efficient and effective. The 
mediation board should compromise 
more financially competent members. 
4. 
Parate execution to be introduced 
to NBFI mainly focusing on property 
mortgages. 
94 
| WORKING DRAFT 
INTERVENTIONS
SECTOR: Non-bank & Financial Institutions 
Credit growth in the financial sector is highly impacted by the following. 
1. 
Implementation of BASEL III,  which requires a substantial increase in 
capital base
2. Adoption of IFRS 9,   likely to impair the capital base of the NBFIs
3. A substantial portion of profits of NBFIs will be netted by the State by 
way of taxes which will significantly affect NBFI ability to lend
4. Difficulties in attracting capital due to low performance in the 
capital market to meet the new capital requirements
5. Difficulties in raising funds due to low investor confidence due to 
excessive taxes on the industry, highly volatile tax policies such as 
retrospective taxes, higher NPAs.
 y
Enhance the guidelines governing NBFIs operations to strengthen 
the sector.
 y
Bring long-term productivity and efficiency  through reduction in 
cost, efficiency gains, economy of scale, enhancement of consumer 
base and innovations.
 y Non-availability of a clear policy framework for the financial sector 
as commercial banking, development banking, leasing and finance, 
micro finance, etc.
5. Slow down of economic growth due to reduction in 
credit supply
6. Sector consolidation and re capitalisation
Financial Sector and Capital 
markets working group proposals
SRI LANKA ECONOMIC ACCELERATION FRAMEWORK 2020-25 | 95
IMPLEMENTATIONS
 Possible relaxation or deferment of 
new capital requirements.
 Consistent policy framework on 
taxation and a long-term view in 
application of taxes and tax rates.
 Possible relaxations to the existing tax 
structure (eg. Debt Repayment Levy).
 Policy framework with clear 
demarcation of the sector as 
commercial banking, development 
banking, leasing and finance, micro 
finance and re-focus on venture 
capital business.
 Restrict issuing any further licenses for 
banks or any financial institutions.
 
Introduction of a policy framework 
that motivates voluntary 
consolidation within the NBFI sector 
addressing requirements such as 
ownership control and degree of 
foreign ownership allowed, capital 
requirements and capital treatments, 
asset liability transfers, tax benefits 
and tax treatments, and asset liability 
transfers. 
 
Introduction of new regulations in 
relation to risk management and 
governance of the sector. 
96 
| WORKING DRAFT 
INTERVENTIONS
SECTOR: Non-bank & Financial Institutions 
 y
Introductions of new technology will be important as cost to income 
(C/I) will be a critical factor in the future in improving the profitability 
of NBFIs.
 y
Slow adoptability of the regulator of new technology and difficulties 
in obtaining approvals.
 y
High costs of technology due to non-availability of cloud computing 
 y Non-availability of common data centres.
7. Technology 
Financial Sector and Capital 
markets working group proposals
SRI LANKA ECONOMIC ACCELERATION FRAMEWORK 2020-25 | 97
IMPLEMENTATIONS
 CBSL to facilitate e-KYC through 
face-recognition apps to facilitate 
e-banking.
 Establish a policy framework on cloud 
computing, common data centres, 
digitalisation and fin tech. 
 Eliminate the requirement for NBFIs to 
have a sponsoring bank in order to 
obtain clearance for issuing products 
like credit cards, etc. to avoid 
unnecessary bottlenecks and costs.
98 
| WORKING DRAFT 
1. Overall policy consistency for manufacturing
3. Implementation issues of laws governing business 
operations due to corruption
2. Amalgamation and modernisation of Industrial 
Parks and Export Processing Zones (IP&EZs) for 
the Sri Lankan economy to progress and move into 
technologically-advanced, higher value-added 
industries.
INTERVENTIONS
Lead:
Mr. Roy Joseph,  
CEO, Hemas Manufacturing (Pvt) Ltd.
Members of the working 
group:
Mr. Nalin B. Karunaratne, 
Chief Executive Officer, 
Ceylon Biscuits Ltd.
Mr. Sumit Law, 
CEO, 
International Distillers Ltd.
Mr. Sanjev Perera, 
Director Operations, 
Alpha Industries (Pvt) Ltd.
Mr. Nilantha Deetiratne, 
Financial Controller, 
Polypak Secco Ltd.
Mr. Salman Nishtar, 
Chief Financial Officer, 
Teejay Lanka PLC
Manufacturing 
working group 
proposals
SECTOR: Manufacturing
SRI LANKA ECONOMIC ACCELERATION FRAMEWORK 2020-25 | 99
 Formulate a clear national vision/
strategy for manufacturing to 
encourage investment into the sector 
(domestic and foreign). 
 Coordination/alignments between 
respective line ministries and 
departments (trade, finance, 
education and more).
 Set up a high-level committee 
comprising of private and public 
sector stakeholders to drive the 
strategy for manufacturing.
 y
Ensuring periodic review on the 
progress against stated action 
plans.
 
Improve Sri Lanka’s  rank to be in 
the top 50 by 2025 in the following 
indicators;
 y
Incidence of corruption by World 
Economic Forum
 y Corruption Perception Index by 
Transparency International
 Establish a business corruption 
reporting action unit.
 Set up designated zones for 
manufacturing to address; 
 y
Lack of industrial land 
 y Upgraded with modern 
infrastructure and necessary 
infrastructure to ensure availability 
of employable labour
 y
Supported with sustainable 
environmental policies 
 y Other ancillary facilities such 
as proper waste and emission 
management, water treatment 
facilities to attract investors and 
ease the business operations
 Bring existing Industrial Parks 
and Export Processing Zones, 
presently managed by different 
Government agencies under one 
entity for prudent management and 
dissemination of information to the 
investor community.
 Develop a PPP approach to 
developing and managing the 
industrial zones.
IMPLEMENTATIONS
100 
| WORKING DRAFT 
INTERVENTIONS
Manufacturing 
working group proposals
SECTOR: Manufacturing
Mr. D. S. J. V. Costa, 
Director / CEO, 
Modern Pack (Pvt) Ltd.
Mr. Kelum Kospelewatte, 
Director, 
Singer Industries Ceylon PLC
Mr. Viville Perera, 
Director, 
Richard Pieris & Co PLC
Mr. Thusith Gunawarnasuriya, 
Procurement and Logistics Director, 
Siam City Cement (Lanka) Ltd.
Mr. Lasantha Wijeweera, 
Director, 
Associated Motorways (Pvt) Ltd.
Mr. Tyrell Roche, 
General Manager-Finance, 
Lanka Tiles PLC
4. Re-looking at irrational tax structures in manufacturing 
sectors with competitive advantage.
6. Supporting services and extension services for  
domestically-manufactured products and imported 
products.
5. Attracting and retaining skilled labour (reversing 
brain drain)
SRI LANKA ECONOMIC ACCELERATION FRAMEWORK 2020-25 | 101
IMPLEMENTATIONS
 Remove unfavourable tax/duty 
structure for manufacture such as: 
 y Double taxation due to dividend 
tax
 y
Rationalise the product inputs 
that are subject to para tariffs 
while finished goods are imported 
duty free
 y
High taxes on machinery and 
other equipment used in the 
manufacturing process
 Addressing policy gaps/updating 
policy impacting manufacturing.
 Enforcing/updating (in line with 
international standards) of existing 
quality standards for domestic 
manufactures and importers.
 Create new standards (in line with 
international standards) for products 
that are not governed by standards.
 Provide up to date equipment to 
Government for inspection and 
certifying purposes.
 Maintain directory of skilled 
categories/for specialised skill/profile.
 Reorienting existing technical 
colleges and setting up technical 
colleges to cater to required industry 
skills.
 Updating all labour related laws 
impacting decision to invest in the 
manufacturing sector.
 Drive agenda for STEAM and English, 
in order to be relevant in the global 
industry.
102 
| WORKING DRAFT 
INTERVENTIONS
Agriculture 
Working Group 
PROPOSALS
SECTOR: Agriculture 
 y National Agriculture Policy to focus on promoting self sufficiency of the six 
main crops – paddy, maize, mung bean, chili, onion and potato. 
 y
Updating regulations and acts such as the Seed Act, Land Reform Act and 
Paddy Land Act 
 y
Introduction of a Plant Varieties Protection Act in order to encourage the 
import of different varieties of plant material required by industries. 
 y
Implementation of quality standards as minimum requisites (GAP) to bolster 
sustainable practices and food safety. 
 y
Focusing on export fruit crops in order to improve Sri Lanka’s image as an 
exotic fruit exporter.
 y
Reformation of transportation and storage for agricultural produce to 
minimise post harvest losses through the use of reusable crates, knowledge 
sharing and the use of cold chains. 
 y
Implementation of a Land Use Plan and Land Data Bank with details and 
specifications of the specific areas. 
 y
Investment in quarantine services to conduct pest risk analysis which would aid 
imports and exports
 y
Branding and marketing programmes and exhibitions to better position the 
country’s exports in the international arena. 
 y
Awareness and education programmes for exporters to focus more on value 
added exports instead of raw produce exports (canning, drying, organic 
production, etc.)
 y
Establishing water management and irrigation in dry zone regions in the country.
PUBLIC INVESTMENT (PROJECTS & ACTIVITIES REQUIRED) 
Lead:
Mr. Rizvi Zaheed    
Director, Vidullanka PLC  
Members of the working 
Group:
Prof. Buddhi Marambe, 
Director, Agriculture Education Unit at 
the University of Peradeniya 
Mrs. Dawn Austin, 
Managing Director, Nidro Supply 
(Pvt) Ltd
Mr. Bandula Egodage, 
VP-Corporate Affairs & 
Communications, Nestlé Lanka PLC 
Dr. A. Shakthevale, 
Director, Lanka Dairies (Pvt) Ltd.
Mr. Chithral Munaweera, 
Consultant, The All Island Dairy 
Association
SRI LANKA ECONOMIC ACCELERATION FRAMEWORK 2020-25 | 103
IMPLEMENTATIONS
 Conduct education programmes 
and seminars to increase 
awareness of technology adoption, 
fertiliser application, crop variety 
development and crop rotation. 
 Establish farmer companies/
organisations/cooperatives  to 
bolster economies of scale, crop 
variety development and improve 
knowledge sharing.
 
Improve awareness of agriculture 
and primary industry sector among 
the youth to increase participation in 
the industry.  
 Facilitate use of railway for long 
distance logistics and the use of 
plastic/corrugated crates. 
 Consolidate  Ministry of Agriculture 
functions and departments for ease 
of policy roll out and ownership.
 Project on creating more parent 
stock, improving access to parent 
stock of export fruits as well as 
granting approval to import high 
quality parent stock. (Note 06)
 Develop the use of sea freight for 
transporting identified agricultural 
produce in order to reduce risk of 
pests.
Key Performance Indicators
Expectations for 2025
Improvement in yield of the six major crops
26% on average for each crop
Improvement in the yield of export fruit crops
50% on average
Agricultural sector as a percentage of exports (non plantation/non value added produce)
ICT tool usage rate - active farmer users using applications. (proven successful in the fisheries industry)
50% of registered farmers
Percentage of agricultural produce transported via railway 
10% 
Percentage of companies compliant with Good Agricultural Practices [GAP]
50-60%

104 
| WORKING DRAFT 
INTERVENTIONS
Agriculture Working 
Group PROPOSALS
SECTOR: Fisheries 
PUBLIC INVESTMENT (PROJECTS & ACTIVITIES REQUIRED) 
 y
Formulating a National Fisheries and Seafood Strategy, export plan and a 
roadmap that the Ministry of Policy Planning, Ministry of Fisheries, BOI and 
EDB have to undertake. Regulation and quality control mechanisms as well 
as the adoption of Best Aquatic and Fisheries Practices (BAP) for fisheries.
 y
Re-examine the Food Act/Fisheries Act and make necessary amendments to 
liberalise Sri Lankan seafood export industry. 
 y
Explore the  possibilities for trade and agreements with countries such as 
USA, Japan and the EU to improve ease of access to markets. 
 y
Initiate fisheries agreements with neighbouring countries such as Seychelles, 
Mauritius, Maldives etc. for Sri Lanka to export directly as opposed to 
returning to Sri Lanka (Note 04).
 y
Removal of Government enterprise control and dependency of export-
oriented businesses.
 y
Provision of incentives for new projects such as marine aquaculture and 
aquaculture farming. 
 y
Introducing new technology to the fishing industry to improve the efficiency of 
fishing operations.
 y Minimising post harvest losses that are at a significant level due to improper 
transportation and storage.
 y
Industry-controlled Research & Development unit including hatcheries to 
improve knowledge-base.
 y
Recognition and empowerment of fisheries and seafood industrial organisations 
to operate on par with EU and other international bodies.
Colonel Channa Weeratunga,  
Executive Director, Global Fisheries 
(Pvt) Ltd.
Mr. Irfan Thassim, 
Founder/Director, Oceanpick (Pvt) Ltd.
All-Island Dairy Association 
SRI LANKA ECONOMIC ACCELERATION FRAMEWORK 2020-25 | 105
IMPLEMENTATIONS
 Mechanise available small long line 
vessels fishing in the EEZ. 
 y Upgrading a selected number 
(100-200) vessels with a winch 
and long line would enable 
boats to return sooner after 
fishing with a larger volume of 
export quality fish.
 
Introducing collection vessels, on-
board frozen fishing vessels as well as 
equipping the larger boats (40-55ft) 
with Refrigerated Sea Water (RSW) 
facilities. 
 Establishment of an advisory 
committee with the participation of 
the Seafood Exporters Association of 
Sri Lanka. 
 y
This would enable members 
actively involved in seafood 
exports to contribute towards the 
development of the industry. 
 Usage of cold storage facilities as 
well as the use of rail transport as 
a faster method of delivering fresh 
produce. 
Key Performance Indicators
2019
2025
Percentage of companies and fisheries compliant with best aquatic and fisheries practices
-
75%
Number of small long-line vessels upgraded with a winch and long-line
25
100
Post harvest loss - % of produce lost per annum
40%
<10%
Volume of fisheries-related produce transported via railway (%)
10%
50%
Increasing the proportion of inland and aquaculture fish production as a percentage of total fish 
production:
 y
Inland and aquaculture                                       
 y Wild capture fisheries
-
30/70
106 
| WORKING DRAFT 
INTERVENTIONS
Agriculture Working 
Group PROPOSALS
SECTOR: Dairy 
PUBLIC INVESTMENT (PROJECTS & ACTIVITIES REQUIRED) 
 y
A comprehensive plan encompassing the needs of farmers, producers as 
well as the consumers of dairy products should be implemented in the  
long run. 
 y
Re-look at the income tax structure to encompass all aspects of the value 
chain in dairy under the concessionary tax rate of 14%. Taxes on dairy 
related equipment to be re-looked at from the perspective of promoting 
the goal of making Sri Lanka self-sufficient in milk requirements. The Livestock 
Board and Customs to be linked to improve the importation and taxation 
process.
 y
Providing education and awareness for dairy farmers regarding procedures 
as processes in the dairy industry.
 y
Implementing a systematic plan and policy for optimising cattle herds and 
minimising the number of unproductive animals.
 y
Allotting crown lands / NLDB lands for fodder development and investment in 
a silage making facility  to overcome the unavailability of fodder throughout  
the year.
 y Carrying out a complete review on the importation of cow breeds (existing 
infrastructure, compatibility of health control) and permitting selection by 
experts. Encourage local breeding than importing breeds unsuited for local 
climate.
 y
Animal breeding - the current coverage of artificial insemination satisfies ~30% 
of the national requirement. Current AI success rates are unsatisfactory due to 
poor animal management and lack of resources and facilities. Thus, there needs 
to be an improvement and an increase in Government veterinary services in  
this regard. 
SRI LANKA ECONOMIC ACCELERATION FRAMEWORK 2020-25 | 107
IMPLEMENTATIONS
 Projects aimed at processing milk at 
regional level to provide access to 
value added dairy products.
 Providing access to nutritious feed 
that is rich in proteins. This would have 
a direct impact on the yield.
 Ensure consistent water access / 
supply is available to dairy farms or 
assist farmer to have access to water 
in a concessional manner to provide 
a proper water supply for farms.
 
Implementing a second round (night) 
milk collection which would be 
possible if the right feeding is done 
as it would result in a 30% increase in 
yield. 
 
Increasing the number of artificial 
inseminators trained to overcome 
shortage of qualified personnel 
required to meet the national 
requirement. 
 
Investment in facilities for cow 
comforts (nutrition, environment and 
shed management) and waste 
management (to convert waste 
potentially into  renewable energy).
Key Performance Indicators
2019
2025
Use of artificial insemination in breeding as a percentage of total breeding requirement
30%
60%
Accessibility of water - Litres of drinking water provided daily per cow (on average)
50-60 L
Daily milk yield per cow (national average)
2 litres
3-4 litres
Number of cows being milked as a percentage of the total milk cow population (cattle)
52%
75%
Number of cows being milked as a percentage of the total milk cow population (buffaloes)
62%
80%
108 
| WORKING DRAFT 
SECTORS
Plantation 
working group 
proposals
SECTOR: Plantation  
Lead:
Dr. Roshan Rajadurai,     
Managing Director, Kelani Valley 
Plantations PLC  
Members of the working 
Group:
Mr. Sunil Poholiyadda, 
Chairman, The Planters’ Association of 
Ceylon
Mr. S K L Obeyesekere, 
Secretary General, The Planters’ 
Association of Ceylon
Mr. Harith Ranasinghe, 
Chairman, Sri Lanka Tea Factory 
Owners’ Association
Mr. Lionel Herath, 
Branch Chairman, Kandy Region, 
Sri Lanka Tea Factory Owners’ 
Association
Mr. Paani Dias, 
Managing Director, Ceciliyan 
Associates Ltd.
Tea
Rubber
SRI LANKA ECONOMIC ACCELERATION FRAMEWORK 2020-25 | 109
INTERVENTIONS
 Establish commercial scale mega 
nurseries with certified and approved 
planting materials supported by a 
financial mechanism for replanting in 
the smallholder sector.
 Grant concessionary loans for 
replanting and capital development 
in the RPC sector.
 Development of a sustainable 
wage model with all stakeholder 
involvement.
 Establish new “land banks” and 
introduce a land use policy for 
plantation land and set up modern 
up-to-date analytical laboratory 
facilities for product testing.
 Amend outdated quarantine laws to 
encourage inclusion of genetically 
modified plantation materials.
 Extend the tax concessions given to 
other export industries to plantation 
industries as well (indirect exporters 
status).
 Develop a platform for auction of 
high value added tea.
 Finalise the leasehold tenure of RPCs 
to support new investments and 
developments.
 Compliance by the State to the 
covenants of the lease / sale 
agreements in respect of land use 
and diversification.
 Form a regulatory body to monitor 
tea factory capacities and monitor 
the pricing formula.
 Enter into new project ventures 
such as:
 y
Fuel wood plantations (Dendro) 
and diversification to other 
plantation crops
 y
Housing schemes in plantations 
near urban centres
 y Development of tourism in 
plantation regions through 
establishment of tourist villages 
and care centres
 y Collaborative ventures for large 
scale vegetable, flower and 
foliage cultivation
 y
Solar power farms on plantation 
land
 y Automation and development of 
robotics
 
Implementation of Plan of Actions 
(POAs) recommended in the Rubber 
Master Plan (RMP) such as;
 y
Expansion of national rubber 
production in large parcels of 
land from non traditional areas 
 y
Productivity enhancement in 
rubber plantations
 y Developing sustainable farming 
Systems
 y
Enhancement of resource use 
efficiency and productivity in 
rubber manufacturing industry
 y
Strategic promotion of Sri Lankan 
rubber products 
 y
Industry-wide technological 
capability development 
 y
Institutional strengthening and 
capacity building
110 
| WORKING DRAFT 
SECTORS
Plantation working 
group proposals
SECTOR: Plantation 
Palm Oil
Mr. K. L. Gunarathne, 
Chairman, Sri Lanka Federation of Tea 
Small Holdings Development Society  
Mr. Sriyan Eriyagama, 
Chief Executive Officer, Namunukula/
Kegalle Plantations PLC
Mr. Saman Doranegama, 
General Manager, 
Kegalle Plantations PLC
Dr. L. M. K. Tillekeratne, 
Former Executive Director, Rubber 
Research Institute of Sri Lanka
Mr. Viren Ruberu, 
Former CEO,  
Kahawatte Plantations PLC
Mr. Kamal Punchihewa, 
Group CEO, Browns Plantations/ 
Browns Capital PLC
Mr. Mahasen Wijayaratne, 
Manager HR & Administration, 
Kotagala Plantations PLC
Mr. Binesh Pananwala, 
Chief Executive Officer, 
Watawala Plantations PLC
Mr. Thanveer Siddique, 
Chief Operating Officer, 
Pyramid Wilmar (Pvt) Ltd.
Coconut
SRI LANKA ECONOMIC ACCELERATION FRAMEWORK 2020-25 | 111
INTERVENTIONS
 Formulate a national policy guided 
KPIs to promote a sustainable palm 
Oil industry in Sri Lanka. Key areas for 
consideration include;
 y
Facilitating cultivation of up to 
20,000 hectares of land within 
RPCs as approved by the 
Government
 y
Incentivising palm oil cultivation in 
the smallholder sector
 y
Providing a sound regulatory 
framework
 y
Recognising palm oil as sixth 
plantation crop
 y
Facilitating research and 
development in palm oil with 
targeted commercial output 
- export of oil palm planting 
material; seed and tissue culture
Formulate a national policy with KPIs to 
promote a sustainable coconut industry 
in Sri Lanka. Key areas for consideration 
include;
 Providing a sound regulatory 
framework:
 y
To implement a price formula 
for coconuts supplied for 
manufacturing and exports.
 y
To monitor and control 
unrestricted importation of edible 
and industrial oil.
 y
To control malpractice such 
as mixing of pure coconut oil 
with any other edible oil and 
marketing under fraudulent 
labelling.
 y
Vigilant supervision of all 
production facilities and exports 
to ensure strict hygienic and high-
quality standards. 
 y
To implement Coconut 
Development Authority (CDA) 
certification for bottled, 
packeted and sealed pure virgin 
coconut oil with SLS Standard 
and ban loose sales of all edible 
oils. 
 y
To encourage sellers and buyers 
of coconut to channel all their 
transactions via the weekly 
auction of coconuts.
 To address issues related to 
fragmentation of productive coconut 
lands and low production and 
productivity of coconut lands
 Encourage public-private sector 
collaboration in research and 
development and promotion:
 y
For commercial application such 
as value-added exports
 y Adopt new technology to assure 
consistent quality production and 
to overcome resource limitations
 y
Promote health benefits of 
coconut and coconut based 
products on health
 y
Promote Sri Lanka’s access to 
global markets
112 
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INTERVENTIONS
Retail working 
group proposals
SECTOR: Retail
Objective: 
 y
To build a hub it is essential that we bring policies that will attract 
tourist to visit and be part of the immersive retail experience. Whilst 
tourism sector related enticements are key, unless retail is allowed 
to rise up to these levels, the maximum spend by a tourist will not 
materialise, nor will the consumption expansion of our limited market 
take place.
1. Facilitation in making Sri Lanka a retail hub:
Lead:
Mr. Murali Prakash,    
Group Managing Director/CEO, 
Ambeon Capital and Ambeon 
Holdings PLC  
Members of the Working 
Group:
Mr. G. Rajendran,  
Chairman, Essential Food Commodities, 
Importers and Traders Association
Mr. Charitha Subasinghe,  
Chief Executive Officer, Jaykay 
Marketing Services (Pvt) Ltd.
Mr. Lahiru Pathmalal,  
CEO and Co-Founder Takas
Mr. Nasser Majeed,  
Chief Executive Officer, Softlogic Retail 
(Pvt) Ltd. 
SRI LANKA ECONOMIC ACCELERATION FRAMEWORK 2020-25 | 113
IMPLEMENTATIONS
a) 
 Bring duty to zero or near zero 
level on key tourist related retail 
products. Key would be clothing 
and accessories, impulse buying 
electronic, electrical items and 
complementary items.
 
The revenue loss of perceived duty 
(plans are never met as volumes 
do not take place) can be easily 
surpassed through an additional 
spend by a tourist at minimum USD 
50-75 level where other forms of 
taxes would kick in locally. With large 
volume increases it could be safely 
assumed that the PAL and other 
charges on import will compensate 
for the duty due to heavy volumes. 
The neighbouring markets such as 
India and even China would be 
large markets for shopping. 
b)  
Implement an automated integrated 
VAT refund system:
 
Current system does not work well 
and hence does not work as a 
positive factor toward tourist spend. It 
is possible to invite overseas players 
to set up this facility on a BOO 
(Build, Own, Operate) basis thus its 
wide spread and easily actionable 
both for tourists and collection of 
revenue. 
c)  Ease of visa for travel and safety of 
travellers
d)  A better and direct connectivity from 
Sri Lanka to key destinations 
e)  A shopping festival as part of 
retail hub activity formally and fully 
supported by the Government 
through:
i)  
Fund allocations to carry 
through this mechanism
ii)  
Special facilities to retailers 
during this period of promotion 
(two months)
iii)  Relevant line ministries to enact 
policies to implement as a 
national programme along with 
tourism. 
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| WORKING DRAFT 
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Retail working 
group proposals
SECTOR: Retail 
Objective: 
 y
Key issues are skills gaps and labour shortages in particular 
encouraging more women to enter and remain in the labour force. 
Objective: 
 y
The right infrastructure would be key to facilitate any industry and 
this would facilitate not only the industry but the country at large. 
2. Labour reforms required:
3. Infrastructure development:
SRI LANKA ECONOMIC ACCELERATION FRAMEWORK 2020-25 | 115
IMPLEMENTATIONS
 Allow for part-time permanency  and 
amending EPF / ETF and related 
acts to facilitate many to come 
into part-time employment. This will 
help employers too as for part time 
functions they need not have full-time 
heads.
 Facilitate a clear structure on 
vocational training to build the skills 
gaps and offer wide and varied 
curriculum on retail. A national 
level integrated policy similar to 
TAFE system in Australia. NAB and 
other offering institutes, etc. can be 
augmented and brought under one. 
 Consider importing labour where 
required as a short-term measure to 
have the required numbers to build 
retail. 
 Permit layoffs based on an agreed 
formula than having to refer to labour 
commissioner every time.
 Permit ex-pat worker spouses to be 
gainfully employed without special 
requirements. This will facilitate more 
Sri Lankans working abroad to return 
as well.
a)  Storage and supply chain 
infrastructure:
i) 
Food and other retail 
perishables being available 
timely, better price regulations 
and being    competitive to 
export, all depends on how 
best harvest is preserved and 
moved through. 
1. 
Permit cold and dry storage 
set up through PPP with special 
relief measures to private  
sector
2.  
Permit cold transportation as 
a nation building effort with 
special duty structures
b)  To facilitate re-export zones:
i )  
This is to get local companies 
along with overseas partners 
set up facilities that would make 
Sri Lanka a retailers’ hub and will 
cater to the entire subcontinent 
at zero taxes or at a nominal 
tax rate (e.g. 1%). Anything within 
this zone is allowed to be re-
exported at zero cost. 
116 
| WORKING DRAFT 
INTERVENTIONS
Retail working 
group proposals
SECTOR: Retail 
Objective: 
 y
Sri Lanka primarily is a cash-based economy. Digital payments/
systems are not matured compare to neighbours and global trends. 
Cash retail is inefficient and expensive. Digital solutions will facilitate 
less corruption (no in-between leakages), greater transparency, less 
inefficiencies (returned cheques to others), speed (cash movement 
real time) and being future centric as most tourist movements today 
are based on the digital economy
 y
Parallel systems tickets (for public transport). This is not digital in most 
cases and in the few digital payment cases they are closed loop 
(one system for one place such as highways)
4. Digital transformation:
SRI LANKA ECONOMIC ACCELERATION FRAMEWORK 2020-25 | 117
IMPLEMENTATIONS
a)  For payments, LankaPay in 
collaboration with payment providers 
to move towards cashless solutions. 
This infrastructure has been built 
but needs to be rolled out with the 
Central Bank of Sri Lanka.
b)  
Invest in open loop systems for tickets 
by working with payment providers. 
This would mean that one payment 
solution can be used for rail/bus 
highways, etc. (one card for all 
travel). 
c)  Facilitate setting up of a infrastructure 
for the entire country which would 
facilitate digital transformation. PPP 
where possible. RFPs can be opened 
for such areas to attract investors 
both local and overseas.
118 
| WORKING DRAFT 
INTERVENTIONS
Transport & 
logistics working 
group proposals
Integration and coordination of departments and 
authorities presently related to transport. This would 
cover services related to maritime, railway, aviation 
and road.
Creating an Integrated National Transportation and 
Logistics Action Plan and align with respective State 
development plans to drive multi modal synergy.
Lead:
Mr. Romesh David,   
CEO, South Asia Gateway 
Terminals (Pvt) Ltd  
Members of the working 
group:
Prof Amal Kumarage, 
Senior Professor, University of 
Moratuwa
Ms. Kasturi Wilson, 
Managing Director, Transportation, 
Hemas Holdings PLC
Mr. H. D. A. S. Premachandra, 
Director/Chief Executive Officer, 
LAUGFS Terminals Ltd.
Ms. Gayani de Alwis, 
Chairperson, The Chartered Institute of 
Logistics and Transport
Mr. Ruwan Waidyaratne, 
Managing Director,  
Hayleys Advantis Ltd.
SECTOR: Transport and Logistics  
REFORMS
SRI LANKA ECONOMIC ACCELERATION FRAMEWORK 2020-25 | 119
IMPLEMENTATIONS
 Re-examine the current regulatory 
functions and responsibilities among 
different agencies with a focus 
on streamlining interactions, and 
integrating processes. An example 
of this would be to examine the 
separating  of the regulator, 
common service provide and the 
operator in aviation and maritime. 
Each department and authority 
policies should include a National 
Transport Policy, Highway Policy and 
Sustainable Development Policy in 
their agenda. 
 Group logistics related authorities 
under a single ministry so that a 
holistic integration is possible with 
one vision and policy. 
 Appoint a competent authority 
who could co-ordinate amongst 
related institutions and stakeholders 
(including Water Board, Ceylon 
Electricity Board and Telecom) where 
road network is explored. 
 Define a five to ten year National 
Logistics and Transport Action 
Plan that has bi-partisan political 
acceptance and drives the 
objectives, priorities and related 
interventions across the logistics 
value chain in consultation with 
relevant ministries taking into account 
the existing policy documents such 
as the National Export Strategy, 
National Maritime Policy, National 
Ports Development Plan. 
 Form a private – public National 
Logistics and Transport Committee 
to drive private and public sector 
investment and action plans which 
are congruent with the long-term 
National Logistics and Transport 
Action Plan. This committee should 
look at positioning Sri Lanka as 
a hub/destination for maritime, 
aviation and logistics. The committee 
should drive the required increase 
in capacity and infrastructure, 
improvement in easing of doing 
business, policy consistency and 
transparency.  
 The topic of agency equity 
ownership towards foreigners will 
need further structured discussions 
with all stakeholders. Meanwhile 
steps should be taken to facilitate 
investment by providing an enabling 
environment. 
120 
| WORKING DRAFT 
INTERVENTIONS
Transport & logistics 
working group proposals
SECTOR: Transport and Logistics 
Enhancing efficiency  through increased digitisation, 
technology adoption and other measures.
Encourage the use of public transport, high
occupancy vehicles and non-motorised transport in 
urban areas. Influence the shift from private modes to 
rapid transit systems through policies that focus 
on quality.  
Mr. Dinesh de Silva, 
Head of Shipping & Logistics,  
Unilever Sri Lanka Ltd.
Mr. Tissa Wickramasinghe, 
General Manager, Commercial & 
Marketing, Colombo International 
Container Terminals
Ms. Shehara Jaywardana, 
Joint Managing Director, McLarens 
Holdings Ltd.
Mr. Chrisso de Mel, 
Immediate Past Chairman, Sri Lanka 
Shippers’ Council
Mr. Iqram Cuttilan, 
Managing Director,  
Aitken Spence Shipping Ltd.
Mr. Jiffry Zulfer, 
Director, PickMe
Mr. Suren Abeysekera, 
Chairman, Sri Lanka Shippers’ Council 
Mr. Sanjeeva 
Abeygoonewardena, 
President, Sri Lanka Association for  
Air Express Companies
Mr. Amal Rodrigo, 
Representative, Hub Operators 
Association of Sri Lanka
BUS
SRI LANKA ECONOMIC ACCELERATION FRAMEWORK 2020-25 | 121
IMPLEMENTATIONS
 A system to collect basic transport 
and logistics statistics in a timely and 
efficient manner.
 
Implementing Customs reforms to 
enable efficiency and increase 
transparency. Applying a de minimis 
threshold will also act as a forerunner 
in getting broader improvements in 
Customs facilitation. 
 Digitalization of the Postal 
Department to accommodate a low 
cost distribution model for last mile 
deliveries. 
 Technology enablement to support 
the implementation of logistics hub 
concept, e-governance, single 
window, e-commerce and port 
community system.
 The Trade Information Portal to 
be continuously updated to be 
the single point of reference for all 
logistics and trade facilitation matters 
in the country. 
 Transport infrastructure measures 
 y
Bus reforms/bus priority lanes/BRT.
 
Integrated Vehicle and Fuel Tax 
Policy to influence  users to divert to  
public transport usage  from private 
vehicle usage.
 Focus on  construction of highways 
covering trunk roads/routes. 
 Set standards and specifications 
in respect of any passenger 
transportation vehicle/service. 
 Enable technology to cover access, 
speed, accuracy, etc.
 Ensure provision of reliable and 
regular service during all times of  
the day.
 y
Prepare timetables for bus 
service operations to minimise 
unhealthy competitive practice 
and to provide equal 
and equitable operating 
opportunities for all.
 y
Facilitate real time information 
provision on bus time tables for 
users
122 
| WORKING DRAFT 
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Transport & logistics 
working group proposals
SECTOR: Transport and Logistics 
Mr Jagath Pathirana, 
Immediate Past Chairman, Sri Lanka 
Freight Forwarders Association 
Mr Dimithri Perera, 
Country Manager, DHL Keells (Pvt) Ltd.
RAIL
Encourage the use of rail transport, influence the modal 
shift of passengers and goods from road to rail by making 
comfortable and faster service offerings.
SRI LANKA ECONOMIC ACCELERATION FRAMEWORK 2020-25 | 123
IMPLEMENTATIONS
INVESTMENTS
 Utilisation of land owned by the Railway Department. Railway stations to be 
developed as service/commercial centres.
 y
Station based developments of property, auxiliary services, ground rentals, 
park and rides and convenience focused developments  
 y Develop railway for freight transport facilities
 y Attract longer distance freight to railways
 
Initiate measures for commodity transportation with the correct distance 
identification
 Railway modernisation to increase frequency and capacity for :
 y
Station modernisation
 y
Railway electrification 
 y
Rapid transit systems (monorails/LRT)
 Promote infrastructure construction for intermodal/ multimodal centres through 
 y
Integration with port, logistics centres and free trade zones
 Centralised platform for e-ticketing 
 y Modernise the existing ticketing system to an online/integrated system
 y Automated seat reservation system
 y
Introduce a mobile-based rail tracking and seat reservation system for 
public transportation
Private investment
Public-private investment
Public-private investment
Public-private investment
Public-private investment
124 
| WORKING DRAFT 
INTERVENTIONS
Transport & logistics 
working group proposals
SECTOR: Transport and Logistics 
LOGISTICS
Improving supply chain of perishables/cold storage
Promote development of multi modal infrastructure 
enabling integration with global and regional value 
chains through seamless multimodal passenger and freight 
transfer, with adequate storage and handling and value 
added services.
SRI LANKA ECONOMIC ACCELERATION FRAMEWORK 2020-25 | 125
IMPLEMENTATIONS
INVESTMENTS
 Policy focus on improving cold supply chain for perishables (Agriculture / dairy): 
 y
Provision of adequate cold storage facilities
 y
Proper infrastructure  facility developments to  facilitate Common User  
Collection Centres
 y
Promote effective agri-logistics involving access to cold chain, storage, 
packaging and other post-harvest management techniques
 Implementing standards on vehicles used for cargo transportation specially 
related to SME industry
 Setting up large-scale logistics centres and related projects by releasing 
Government-owned lands, rationalization of legislation and more
 Enabling integration with global value chains through seamless multi modal 
connectivity
Focus on private investment that 
is encouraged through land, duty 
waivers on equipment, agri-related 
financing, green financing. 
Public-private investment
126 
| WORKING DRAFT 
INTERVENTIONS
Transport & logistics 
working group proposals
SECTOR: Transport and Logistics 
MARITIME
Policy focus on developing Colombo Port
Rationalise the usage and development of other ports to 
complement each other
Eg: Hambantota, Trincomalee and Galle to exploit the unique logistics 
potential
Fast-tracking implementation of e-connectivity to 
facilitate seamless interaction between various 
stakeholders. 
SRI LANKA ECONOMIC ACCELERATION FRAMEWORK 2020-25 | 127
IMPLEMENTATIONS
INVESTMENTS
 
Initiate terminal developments at Colombo port that includes: 
 y
East and West container terminals- Increase container terminal capacity 
(potential throughput of 15-16 million TEUs by 2025)
 y Oil and bunkering handling terminal
 y
Passenger/cruise Terminals 
 Enhance port infrastructure: 
 y
Improve ancillary and marine services (bunkering, handling, safety, ship 
supply services, tugs, pilotage)
 Specialisation of ports where break bulk, liquid bulk, solid bulk and container 
handlings are segregated.
 Align Hambantota into national ports master plan to complement each other
 
eg: ships with non-container cargo should be moved out of Colombo
 Promote free port concept outside the port (dry ports)
 Phased implementation of a port community system, Electronic Data 
Interchange (EDI), e-commerce to be rolled into the National Single Window. 
The implementation to be done with institutionalisation of the change and with 
education of the required stakeholders.
 The establishment of a single-stop, single-window, electronic port goods 
declaration and customs inspection mechanism for quick entry and exit of 
international cargo
Public-private Partnership
Public-private Partnership
Public-private Partnership
Public investment through private 
sector dialogue  
128 
| WORKING DRAFT 
INTERVENTIONS
Transport & logistics 
working group proposals
SECTOR: Transport and Logistics 
Diversifying the hub offerings to cover cruise, cars, oil, 
gas and more, using the diversity of the ports.
AIR
Separate roles of landlord and common services 
provider (ATC/security, etc.) from airport operator 
(Ground handling of Pax/cargo).
Decide on funding mechanism for long overdue BIA 
expansion.
SAFETY, SUSTAINABILITY AND 
DIVERSITY
Encouraging adoption of sustainable and  green 
logistics in the country.
SRI LANKA ECONOMIC ACCELERATION FRAMEWORK 2020-25 | 129
IMPLEMENTATIONS
INVESTMENTS
 Strengthening the offerings at Sri Lankan ports such as vessel ownership, maritime 
education, dispute resolution, maritime laws and arbitration
 Expansion of passenger and cargo handling facilities; such as for aero bridges, 
transit spaces, check-in and Immigration/Emigration counters, ramp space, and 
cargo terminals. 
 Deregulate ground handling and assign regulator for handling
 Initiate steps to increase cargo and runway capacity
Public-Private investment – Use a 
derivative of port PPP model
 Technological approaches to improve the performance of  transport 
equipment and facilities – use of IoT
 Promote sustainable reverse logistics
Private
130 
| WORKING DRAFT 
INTERVENTIONS
Transport & logistics 
working group proposals
SECTOR: Transport and Logistics 
Policy focus on road, air and sea  safety considering the 
environmental implications 
Encourage diversity and inclusiveness in the sector 
SRI LANKA ECONOMIC ACCELERATION FRAMEWORK 2020-25 | 131
IMPLEMENTATIONS
INVESTMENTS
 Highlight road safety as an urgent national issue and mobilise a National Task 
Force including public, private and civil society stakeholders.
 Framework to monitor the safety of 
 y
Road design
 y
Road discipline
 Set standards and specifications in respect of any passenger/goods 
transportation vehicles/services to prevent poor standards and operating 
practices. This includes:
 y
Vehicle engine standards
 y
Low emission zones
 y Operator license
 y
Vehicle maintenance and operational tests and checks
 Setting standards for safe handling of petroleum, chemical and petrochemical 
products and waste
Public-Private
 Establish vocational training centres for women and open up jobs for women 
such as gate operators, bus drivers and more. To enable this amend relevant 
administrative circulars and national labour laws
132 
| WORKING DRAFT 
INTERVENTIONS
Lead:
Prof. Malik Ranasinghe,  
Chairman, Sampath Bank, Members of 
the University Grants Commission 
Members of the working 
group:
Prof. Nilanthi De Silva,  
Senior Professor Parasitology, 
University of Kelaniya
Prof. Lalith Gamage,  
Managing Director/CEO, Sri Lanka 
Institute of Information Technology 
(SLIIT)
Dr. Piyasiri Tilakaratne,  
Vice Chancellor, University 
of Vocational Technology
Mr. Vajira Kulatilake,  
Director / Chief Executive Officer,  
NDB Capital Holdings Ltd. 
Higher Education 
group proposals
SECTOR: HIGHER EDUCATION
Objective: 
 y
Students have ownership and freedom of choice for their higher 
education and the system moves from “Free without Choice” to “Self 
Funded with Choice”.  
 y
HEIs would focus on USPs, competing with other institutions, 
facilitating innovation and growth.
 y
Students will be more eager to participate in tertiary education. 
Objective: 
 y
Establish a standard of quality throughout the higher education 
system. 
1.  Provide students greater freedom to choose their 
desired course of study and Higher Education Institutes 
(HEIs), both State or non-State.
2.  Establish quality assurance and accreditation authority  
encompassing all HEIs (State and non-State) in 
Sri Lanka.
SRI LANKA ECONOMIC ACCELERATION FRAMEWORK 2020-25 | 133
IMPLEMENTATIONS
 Provide endowments or grants for 
students to enroll themselves in 
higher education. The HEIs will be 
reimbursed by Treasury / UGC / 
TVEC on the submission of those 
certificates. Selection of students 
by the Higher Education Institutions 
(HEIs).
 Providing students rather than the 
institutions with funds to incorporate 
choice. Initially commence this as 
a pilot project with a selected few 
streams/degrees. 
 Develop a nation-wide academic 
portal for students to access the 
courses offered by HEIs, similar to UK’s 
UCAS system.
 The academic portal would have all 
information regarding course modules 
and thereby enabling students to 
choose their desired courses.  
The authority must be independent, robust 
and put forward a national system for 
quality assurance and accreditation. 
Some of the essential features should 
include:
 Compulsory registration of all 
HEIs (public and private) and the 
programmes of study offered by them;
 An authority with a clear legal 
mandate to offer accreditation of 
registered HEIs and their programmes 
of study; 
 The accreditation authority must 
be independent, i.e., not under the 
Ministry of Higher Education or the 
UGC;
 The composition of the members of 
the authority must reflect its mandate 
and ensure its ability to function 
effectively.
134 
| WORKING DRAFT 
INTERVENTIONS
Higher Education 
group proposals
SECTOR: HIGHER EDUCATION 
Mr. Murtaza Jafferjee,  
CEO, JB Securities Ltd.
Mr. Faizal Salieh,  
Non-Executive Independent Director, 
Cargills Bank Ltd.
Objective: 
 y
Ensuring that tomorrow’s graduates are relevant and employable 
through the participation of employers with HEIs.
 y Allowing open access to all course information.  
Objective: 
 y
Promote strong collaborations between TVEC, NAITA, DTET and 
professional and employer bodies. 
 y
Expand TVEC to encompass emerging skills requirement
 y
Establish training institutions and provide progressions pathways.
3.  Ensuring that the courses are relevant to today’s 
rapidly-evolving global economy. 
4. Develop technical and vocational HEIs to expand their 
reach and target industry needs.
SRI LANKA ECONOMIC ACCELERATION FRAMEWORK 2020-25 | 135
IMPLEMENTATIONS
 Engaging employers, industry experts, 
professional bodies and chambers 
of industry to update and revise the 
curriculum to be current with emerging 
trends.
 Establish department industry 
consultative Units in all HEIs.
 This unit will ensure administrative 
efficiency and will also provide 
students with insights into trends in 
emerging skills.
 Promote strong collaborations 
between NAITA, DTET, TVEC 
and employer bodies to expand 
apprenticeship based training and 
provide a training allowance to 
apprentices.  
 Establish several training institutions in 
collaboration with world-renowned 
companies/training institutions, 
similar to Ceylon German Technical 
Training Institute, in areas of modern 
technology.
 Provide seamless progression 
pathways from secondary education 
to technical and vocational 
education for those who do not 
enter universities. Expand and 
strengthen the newly-introduced 
vocational stream in secondary 
education.
 Establish an endowment/loan 
scheme similar to the scheme 
proposed to university education 
for middle level Technical and 
vocational education in areas of 
high labour market demand.
136 
| WORKING DRAFT 
INTERVENTIONS
Health working 
group proposals
SECTOR: Health
Lead:
Dr. Lakith Peiris,   
Managing Director, Hemas Hospitals & 
Laboratory Chain  
Members of the working 
group:
Dr. Anil Samaranayake, 
Director Health Information of the 
Ministry of Health
Dr. Prasad Medawatta, 
Group CEO, Lanka Hospitals
Dr. Ravindra P. Rannan, 
Eliya - Executive Director & Fellow of 
the Institute of Health (IHP)
Mr. Sirimal Fernando,  
President - The Sri Lanka 
Pharmaceutical Manufacturers’ 
Association
Ms. Kasthuri Chellataja, 
President, The Sri Lanka Chamber of 
Pharmaceutical Industry
1. Introduce Electronic Medical Records (EMR)
2. Address Non-Communicable Diseases (NCDs)
3. Effective utilisation of healthcare assets through 
public private-partnership
SRI LANKA ECONOMIC ACCELERATION FRAMEWORK 2020-25 | 137
IMPLEMENTATIONS
A) 
Establish a electronic  health record 
system so that patients could 
access their individual health record 
irrespective of the place of treatment 
and that health providers may 
update that health record as they 
treat the patient.
B)  Develop Sri Lankan laws regarding 
protection and sharing of personal 
medical data of individuals
A)  Establish a national framework on 
NCD prevention, screening and 
treatment that is adhered  to by 
healthcare providers in the private 
and public space
B)  Establish a continuous education/
awareness programme across 
private and public sectors regarding 
NCDs, with the aim of reducing 
the prevalence of NCDs in the 
population of Sri Lanka
C)  Establish a centralised data 
collection, analysis and reporting for 
the purpose of comprehensive health 
information view
A)  Currently there is a long waiting 
time for critical interventions and 
diagnostic procedures in the public 
sector that compromises patient 
safety and the quality of life of 
patients. Establishment of a PPP 
between the public sector and the 
private sector healthcare providers 
will reduce long waiting times, 
reduce the burden on the public 
healthcare system, can reduce 
capital expenditure by the GOSL 
to increase capacity and for the 
acquisition of new technology whilst 
providing better services and clinical 
outcomes at a lessor cost 
B)  Establish PPPs where private sector 
healthcare institutions are allowed to 
service an empaneled population if 
Government healthcare institutions are 
not present to service that population
C)  For the major hospitals in the 
public sector,  the usage of certain 
resource capacities are being 
under-utilised at the moment. 
This may include amongst others, 
imaging services, operating theatre 
and other diagnostic equipment/
services. Through the implementation 
and use of a centralised platform 
for scheduling , it would allow the 
Ministry of Health (MoH) to have 
a clear understanding of hospitals 
where imaging devices are over and 
under utilised so that the MoH can 
accordingly manage the demand. 
The same may be replicated in the 
private sector and at an advanced 
stage so that patients may seamlessly 
be able to move to/from public 
sector to private and vice versa.
138 
| WORKING DRAFT 
INTERVENTIONS
Health working 
group proposals
SECTOR: Health
Mr. Ruwan Kumara, 
Acting Chairman, the Food & 
Beverages Steering Committee of the 
Chamber
Mr. Shayam Sathasivam, 
Chairman, the Cosmetics and 
Pharmaceuticals Steering 
Committee of the Chamber / Former 
President, The Sri Lanka Chamber of 
Pharmaceutical Industry
4. Capacity enhancement of Healthcare / Pharma 
through higher education programmes
5. Promote medical tourism
6. Promote local pharma manufacturing
SRI LANKA ECONOMIC ACCELERATION FRAMEWORK 2020-25 | 139
IMPLEMENTATIONS
A)  Encouragement of setting-up higher 
education facilities that support the 
healthcare and pharmaceutical 
industry.
B)  Permit the registration and 
recognition of nurses, MLTs, 
pharmacists and other paramedics 
to at least have a separate register.
C)  Government to offer concessionary 
loan schemes for nursing students 
(similar to offered by other countries 
like India by the Kerala Government).
D)  Develop an ongoing mechanism 
to incentivise students towards the 
healthcare and pharmaceutical 
industries, such as payment of a 
stipend, etc.
A) 
Establish a visa scheme for tourists 
seeking to come to Sri Lanka for 
medical treatment. This visa scheme 
should be developed with a 
specified criteria such as the required 
stay time for patients undergoing 
procedures in Sri Lanka.
B) 
Promote Sri Lanka as an emerging 
medical hub through Government 
intervention such as funding for 
promotional material, private 
sector operators to showcase their 
capability in different overseas 
forums/events, identify key health 
intervention that can be marketed to 
select markets, etc.). This hub should 
be supported by a digital health 
record that can be transferred/
accessed by the patient, access to 
quality-certified medicine, access to 
qualified healthcare professionals. 
C) Promote traditional health 
aggressively in selected overseas 
markets through development of 
country specific promotional tools 
and campaigns to establish/promote 
Sri Lanka as an emerging wellness 
hub
A)  Position Sri Lanka as a global 
manufacturer, through:
I. 
Commencement of a study to 
identify key molecules or drugs 
that Sri Lanka should specialise 
in as a hub for pharmaceutical 
manufacturing and export to 
meet global market demand.
II. 
Engage with international 
consultants to understand what 
global markets where Sri Lanka 
can engage as the manufacturer 
for key identified products.
III. Government to develop 
policy framework and relevant 
committee to facilitate export-
oriented pharmaceutical 
manufacturing
IV. 
For identified molecules or 
drugs, reach out to the leading 
manufacturers in order to assess 
what the country could do 
in order to attract contract 
manufacturing in Sri Lanka. 
B)  While the Government has 
allocated Rs. 100 million towards a 
biotechnology park, the continuous 
focus towards this area should be 
carried forward with appropriate 
follow through to ensure that 
this is the initiation of Sri Lanka 
as a research hub for select 
pharmaceutical products.
C)  Examine how the Bio-Technology Park 
and Nano-Technology Park (through 
their respective ministries and 
bodies) can be more synergistically 
aligned in order to benefit the 
pharmaceutical sector in Sri Lanka.
140 
| WORKING DRAFT 
INTERVENTIONS
Health working 
group proposals
SECTOR: Health
7. Ensure pharmaceutical importers have sustainable 
supplies to patients
SRI LANKA ECONOMIC ACCELERATION FRAMEWORK 2020-25 | 141
IMPLEMENTATIONS
A)  Development of a quality standard 
for pharmaceutical products and 
setup of a testing facility in order 
to facilitate this monitoring of the 
pharmaceutical products being 
manufactured and imported into 
Sri Lanka. Further, development 
of regulations relating to the 
quality review process to be 
conducted by the independent 
body charged with conducting 
an ongoing quality review of 
products locally manufactured and 
imported to Sri Lanka alongside 
the overall distribution chain of 
these pharmaceutical products to 
the end-customer. Subsequent to 
the regulations being published, 
circulation of quality guidelines and 
results from quality inspections to 
be made public and post-market 
surveillance to be more regular and 
pro-active (currently complaint-
initiated)
B)  With regard to the imposition of price 
controls:  Where price control of 
identified pharmaceutical products 
are required, ongoing dialogue 
and sufficient advance notice to 
be given to importer/distributors to 
account for their ordering lag times 
and optimal order quantities in terms 
of months for those pharmaceutical 
products.
C)  
Introduce pricing refinement:  
Development of a pricing formula 
through identifying acceptable 
solution to the debate around CIF+ 
pricing model – e.g. benchmark on 
Sri Lanka IQVIA median pricing if an 
existing molecule, look to regional 
pricing medians if a new molecule.
D)  Review of the existing government 
procurement guidelines in order 
to incorporate the shift in the 
global market towards biological. 
This is done with the view of 
identifying the required procurement 
quality guidelines for biological 
when compared to traditional 
pharmaceutical products (i.e. 
government procurement guidelines 
applicable for bio-similar may not be 
the same that applies to traditional 
pharmaceutical products, where bio-
similar cannot be tested the same 
way a traditional pharmaceutical 
product). Implementation of this 
policy can through review of existing 
regulatory approval or availability 
of the product in developed markets 
(e.g. FDA approved, however, in 
the absence of FDA-approval be 
commercially available in the country 
of origin and USA, EU, Japan and 
other developed countries).
142 
| WORKING DRAFT 
Health working 
group proposals
SECTOR: Health
Intervention 
Point
Proposed KPI 
1 A) 
 Total number of public PMCIs that are utilising an EMR – 600 by 2025
 Total number of private healthcare institutions that are utilising an EMR – 60 by 2025
2 A) 
 Percentage of public healthcare institutions complying with the national framework for NCD prevention
 Percentage of public healthcare institutions complying with the national framework for NCD screening
 Percentage of public healthcare institutions complying with the national framework for NCD treatment
 Percentage of private healthcare institutions complying with the national framework for NCD prevention
 Percentage of private healthcare institutions complying with the national framework for NCD screening
 Percentage of private healthcare institutions complying with the national framework for NCD treatment
3 A)
 A central database that will capture the waiting time for patients who are seeking the following services:
 CABG, angiogram/PTCA, electrophysiology, ASD / VSD closures, coarctation of aorta , aortic valve stenosis 
 Pulmonary valve in paediatrics, total knee replacements, total hip replacements, arthroscopies
 Shoulder replacements, spinal surgeries (Laminectomy, etc.). Presently these times are available for the Western 
Province. 
3 C) 
 As a percentage of the total number of major hospitals (Teaching Hospitals, Provincial General Hospitals, 
District General Hospitals and Base Hospitals), the number of major hospitals that are connected to a 
centralised system to monitor asset usage. 
 As a percentage of the total number of major hospitals (Teaching Hospitals, Provincial General Hospitals, 
District General Hospitals and Base Hospitals), the number of major hospitals that are utilising a system-based 
scheduler for setting appointments for imaging devices and operating theatres
5 A) 
 Total number of visas issued for foreigners to enter Sri Lanka for the purpose of medical tourism
 Total number of foreign patients treated in Sri Lanka
SRI LANKA ECONOMIC ACCELERATION FRAMEWORK 2020-25 | 143
Intervention 
Point
Proposed KPI 
7 A) 
 Of the total pharmaceutical products sold in Sri Lanka, the percentage of pharmaceutical products that 
are regulated through quality standards enforced by the Government of Sri Lanka through the respective 
regulatory/NMRA.
 Of the total pharmaceutical products sold in Sri Lanka, the percentage of pharmaceutical products that are 
tested through the appointed testing facility before being sold in Sri Lanka
 Total number of quality reviews of local manufacturers being conducted by the respective regulatory as 
against the total population of local manufacturers
 Total number of quality reviews of local distributors being conducted by the respective regulatory as against 
the total population of local distributors
7 C)
 Total number of pharmaceutical products being sold in Sri Lanka where the pricing is determined through the 
pricing formula
144 
| WORKING DRAFT 
INTERVENTIONS
Lead:
Ms. Shiromal Cooray,   
Chairman Jetwing Hotels Ltd.
Members of the working 
group:
Mr. Mahen Kariyawasan,  
The Sri Lanka Association of Inbound 
Tour Operators
Mr. Harith Perera, 
The Sri Lanka Association of Inbound 
Tour Operators
Mr. Nalin Jayasundera, 
The Sri Lanka Association of Inbound 
Tour Operators
Mr. Amith Sumanapala, 
The Sri Lanka Association of Inbound 
Tour Operators
Mr. Sanath Ukwatte, 
The Hotels Association of Sri Lanka
Tourism working 
group proposals
SECTOR: Tourism
1. Moving towards a value-driven industry while 
managing the maturing tourism industry in a 
sustainable manner.
2. Recognition of tourism as a key export services 
industry 
SRI LANKA ECONOMIC ACCELERATION FRAMEWORK 2020-25 | 145
IMPLEMENTATIONS
 Study and implement best practices 
from countries such as Costa Rica 
which focuses on value, quality and 
sustainability. 
 Target five million tourists and USD 10 
Bn in tourism earnings by 2025. With 
the increase in the number of arrivals, 
the strategy should be designed to 
increase the average spend. 
 Examine other value metrics in the 
industry. This will require improvement 
in data collection by the industry as 
well as institutions like SLTDA.  (Refer 
appendix 1 for an exhaustive list) 
 Enable the industry to avail the similar electricity tariffs as an export sector 
 Devise a National Tourism Export Strategy 
TOURIST ARRIVALS
2018
2025
2.33 Mn
5 Mn
11
.5%
 C
AG
R
TOURISM RECEIPTS
2018
2025
12
.5%
 C
AG
R
USD 4.3 Bn
USD 10 Bn
146 
| WORKING DRAFT 
INTERVENTIONS
Tourism working 
group proposals
SECTOR: Tourism 
Mr. Asoka Hettigoda, 
The Hotels Association of Sri Lanka
Mr. M. Shanthikumar, 
The Hotels Association of Sri Lanka
Ms. Amal Goonetilleke, 
The Hotels Association of Sri Lanka
3. Align tax policies to be in line with the region to 
remain competitive. 
4. Formation of an inter-ministerial taskforce comprising 
the respective subject minister, secretary to the 
ministry and the director general/heads for the 
respective department/Institution. This is to develop 
policies for the industry in a coordinated manner to 
address legal, regulatory and procedural issues.
SRI LANKA ECONOMIC ACCELERATION FRAMEWORK 2020-25 | 147
IMPLEMENTATIONS
Country
Sri LankaIndiaBangladeshPakistanMalaysiaSingaporeMaldivesThailandVietnamIndonesiaIncome Tax
14% 25%-30%
25%
30%
24%
17%
15%
20%
20%
25%
VAT, NBT and additional taxes paid on the top-line
VAT and GST
Now at 7% 
(previously 
15%)
18%
15%
17%
0%
7%
12%
7%
10%
10%
Other taxes 
applicable
2% (NBT)
n/a
n/a
n/a
n/a
n/a
n/a
n/a
n/a
n/a
TDL
1%
n/a
n/a
n/a
n/a
n/a
n/a
n/a
n/a
n/a
Provincial Tax
Up to 1%
n/a
n/a
n/a
n/a
n/a
n/a
n/a
n/a
n/a
Inter-Ministerial Taskforce
Tourism Ministry and Key Institutions such as SLTDA, SLTPB, SLCB
 Ministry of Transport 
and Civil Aviation
 Ministry of Megapolis
 Department of 
Railways
 Ministry of Foreign 
Affairs
 Ministry of Wildlife
 Ministry of 
Environment (including 
CEA)
 Central Cultural Fund
 National Crafts 
Council
 Sri Lanka Police
 Ministry of Youth
 Ministry of Labour
 Department of 
Immigration and 
Emigration
 Ministry of Finance 
(Excise Department, 
Customs, Inland 
Revenue)
 Ministry of Local 
Government
 Ministry of Defence
 Ministry of Primary 
Industries
 Department of 
Ayurveda 
 Board of Investments
Proposed Policies
 The ministries/departments involved in the tourism industry working together in one forum to take coordinated decision, with Tourism 
Board being the main stakeholder. Examine matters such as (Refer appendix 2), 
148 
| WORKING DRAFT 
INTERVENTIONS
Tourism working 
group proposals
SECTOR: Tourism 
5. Re-look at the Aviation and Port Policy 
(in terms of cruise tourism)
6. Develop a Disaster Management Plan to manage 
crisis situations  (natural disasters / terrorist attacks).
SRI LANKA ECONOMIC ACCELERATION FRAMEWORK 2020-25 | 149
IMPLEMENTATIONS
 
Increase capacity to match 
expected tourists at airports and sea 
ports.
 Special emphasis to be given for 
cruise tourism. SLTDA to work with 
relevant authorities to bring local 
infrastructure and standards to 
global cruise benchmarks.
 
Introduce a tourism friendly aviation 
policy. SriLankan Airlines to play an 
integral part in the development and 
promotions of tourism.
 
Improve domestic airports and air 
travel facilitate convenient and 
affordable access to the major 
tourism provinces.
 
Industry, private and public partnership 
together with higher authorities to draw 
attention to high national security 
standards and map-out a crisis and 
disaster management plan.
 Have a clearly defined procurement 
process for offshore PR and marketing 
for the tourism industry during a crisis 
period as it requires immediate action. 
 To develop a central news point to 
disseminate regular and accurate 
information on the actual situation. 
 Develop clear guidelines to handle 
local and international media during 
a crisis period in order to avoid 
sensationalisation and dilution of 
Brand Sri Lanka. 
 Crisis management plan to be 
regularly reviewed, trial tested and 
communicated.  
150 
| WORKING DRAFT 
Appendix 1 
In reference to Point 1 - Tourism
Proposed Interventions/Activities 
 Tourism marketing to be a key lever in moving towards a value driven sector: Procurement procedures for tourism promotional initiatives to 
be made more flexible and dynamic in sync with the operational model of the industry. SLTPB funds to be used only for offshore promotions 
approved by the said board. 
 
Introduce tourism in the secondary education curriculum. 
 
Introduce a visitor management system for cultural sites and wildlife parks. This will manage over visitation of the sites, offering different time 
slots and price differentiations.
 Organise and improve better facilitation at the tourist sites, national parks and any other relevant sites to international standards.
 Engage to support and find solutions to the human elephant conflict.
 Common policy on wildlife / marine sustainability and its impact to tourism under one policy to enhance tourism.
 All entrance tickets to be centralised with easy purchasing options reaching international standards.
 Promote and develop the rural industry to make them interesting tourist attractions.
 Enhance Colombo’s entertainment facilities to attract and cater to exclusive foreign visitors. 
SRI LANKA ECONOMIC ACCELERATION FRAMEWORK 2020-25 | 151
Appendix 2 
In reference to Point 4 - Tourism
Proposed Policy, legal/regulatory issues to be taken up by proposed 
Inter-Ministerial Taskforce 
 Moratorium on approvals for new inventory in Colombo and areas of oversupply
 Development of a state-of-the-art convention centre (capacity for over 6-7k) for MICE tourism to maintain the existing room inventory.
 Regulation of all accommodation units (including homestay) of non-residents and monitoring of due remittances as per the Financial Act.
 Devise appropriation regulation on construction of properties limiting the number of floors on the coastal line and near the ancient city 
sites and in the areas of beautiful landscape. Develop blueprint for every destination, covering all relevant areas relating to planning of 
land space.
 Construction of sites sewerage management, garbage disposal management, etc.
 Plan out and determine maximum number of rooms required in different areas of the island and such numbers to be broken down to 
boutique, five-star, four-star, three-star, two-star and below, and extend approvals accordingly.
 
Information hubs to be established with major cities, in particular highlighting Tourist Police.
 Devise guidelines to provide accessibility for differently-abled people.
 System of licensing and approvals to be brought strictly within the given framework.
 All the licensing and approvals to continue under the present gazette notification but with strict monitoring.
 
Improve the network, quality, frequency, connectivity, and booking system of air transport and the train system.
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The document would not have been compiled without the 
support from the staff of EY , KPMG and PwC. We are grateful 
to the following individuals for their contribution:  
EY 
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PwC 
Ruvini Fernando – Director 
Aruna Perera – Director
Kavinda Weerakoon – Director
Maduranga Hettiarachchi – Consultant 
Abhishek Kalupathirana – Consultant
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Kieron Cooke – Analyst  
KPMG
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www.chamber.lk