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Regulatory policies seen as key to SL’s global competitiveness

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The IPS panel of experts

By Ifham Nizam

As Sri Lanka tackles its economic recovery and development, regulatory policies across key sectors—trade, energy and agriculture—are set to play a pivotal role in determining the nation’s global competitiveness, Institute of Policy Studies, Research Fellow, Dr. Manoj Thibbotuwawa said.

Speaking on the topic `How Regulatory Policies Could Shape Global Competitiveness’ at a discussion held at the IPS recently in Colombo, he said, whether carefully crafted or poorly implemented, these policies could either accelerate Sri Lanka’s progress or leave it vulnerable to crises, as evidenced by the recent missteps in agricultural policy.

He also said that the fertilizer ban, implemented without proper preparation, caused havoc in the agricultural sector, resulting in two consecutive failed seasons.

Thibbotuwawa added that despite traditionally being self-sufficient in rice production, Sri Lanka was forced to import large quantities of rice, underlining the catastrophic consequences of poorly planned regulations. This experience highlights the importance of sound policymaking across sectors critical to the nation’s global economic standing.

Trade liberalization can be both an engine for growth and a source of economic strain. IPS, Research Fellow, Dr. Asanka Wijesinghe, who is an expert in economic integration, stressed that the complex implications of joining regional trade agreements, such as, the Regional Comprehensive Economic Partnership (RCEP).

He added that while liberalizing trade could stimulate Sri Lanka’s GDP growth and create jobs, it comes with significant challenges, such as, an increase in trade deficits with manufacturing giants like China and East Asian countries.

‘Sri Lanka faces the challenge of reorienting its economic focus toward export-led growth, he noted adding that domestic industries remain heavily protected, which inhibits the development of an export-oriented economy.

“To harness the full potential of trade agreements, policymakers must prioritize sectors where Sri Lanka holds a comparative advantage. However, this shift requires a delicate balance to manage short-term disruptions, including potential impacts on the labor market, he added.

High energy costs remain a stumbling block for Sri Lanka’s export competitiveness, said IPS, Research Fellow, Dr. Erandhatie Pathiraja, adding that energy pricing reform is vital for making Sri Lankan industries globally competitive. Sectors such as apparel and tea—key contributors to national export earnings—are particularly sensitive to energy costs, which erode profit margins and make it difficult to compete with lower-cost producers in the region.

She stressed that renewable energy presents a promising solution to this problem, with Sri Lanka already having committed to ambitious climate goals under its Nationally Determined Contributions (NDCs).

However, she said institutional bottlenecks and political roadblocks have delayed the adoption of renewable energy technologies. `For Sri Lanka to reduce its reliance on expensive fossil fuels and improve its global competitiveness, overcoming these barriers will be critical.’

Agriculture remains a cornerstone of Sri Lanka’s economy, contributing 8% of GDP and nearly 20% of export earnings, said IPS Research Economist Dilhani Hirimuthugodage.

Despite its importance, she said that the sector is burdened by structural issues such as land fragmentation, low mechanization, and outdated technology.

She stressed that as Dr.Thibbotuwawa highlighted, the recent fertilizer ban further exacerbated these challenges, resulting in significant losses for farmers and reduced yields.

However, she added that Sri Lanka’s agriculture sector holds untapped potential, particularly in export agriculture. Spices, for example, represent a key area where Sri Lanka has a strong competitive advantage on the global stage.

“To capitalize on this potential, the government must invest in modernizing agricultural practices, improving supply chains, and accessing new markets. By doing so, Sri Lanka can diversify its export portfolio and boost overall economic growth, she stressed.

In closing remarks, Dr. Thibbotuwawa said the road ahead for Sri Lanka involves not just reforming individual sectors but adopting a holistic, integrated approach to economic development. Policymakers must recognize the interconnectedness of trade, energy, and agriculture and create regulatory frameworks that enable each sector to thrive in the global marketplace.



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USD 57.4m power investment opens new route for SME energy savings

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A rooftop solar panel in Sri Lanka

By Ifham Nizam

A USD 57.4 million investment package is set to reshape the economics of electricity for small and medium-sized businesses, while creating a stronger platform for private investment in rooftop solar and other distributed renewable-energy projects.

The financing package—comprising a USD 35 million concessional loan from the Asian Development Bank (ADB), a EUR 15.4 million grant from the European Union (EU), equivalent to USD 16.94 million, and a USD 5.5 million grant from the Japan Fund for the Joint Crediting Mechanism (JFJCM)—will finance a five-year programme to modernise the electricity distribution system from 2026 to 2030.

For the business community, one of the most significant elements is the planned introduction of Virtual Net Metering (VNM), which will be implemented in the country for the first time.

The EU-funded component will support 25 MW of aggregated rooftop solar PV capacity, specifically aimed at helping reduce the electricity-bill burden of small and medium-scale entrepreneurs.

The move could open a new investment channel for SMEs that have traditionally faced difficulties in absorbing high energy costs and making the upfront investment required for renewable-energy systems.

Rather than viewing rooftop solar simply as a household energy solution, the programme positions distributed solar as an important business-cost management tool.

For SMEs, which operate with considerably tighter margins than many large corporates, electricity expenditure can have a direct impact on competitiveness, cash flow and the ability to expand operations.

By allowing electricity generated from qualifying rooftop solar installations to be applied through a virtual net-metering arrangement, the programme is expected to broaden the economic benefits of solar power beyond individual premises.

The financial significance of the scheme extends beyond the initial 25 MW.

By establishing the infrastructure and regulatory framework required to manage aggregated distributed generation, the project could help create greater investor confidence in the development of decentralised renewable-energy assets.

The investment therefore has the potential to leverage additional private capital into the renewable-energy sector rather than functioning solely as a government-funded infrastructure programme.

The financing package is particularly notable because a substantial portion comes in the form of grants and concessional funding, reducing the cost of financing technologies that would otherwise require significant upfront capital.

The ADB loan will support the wider modernisation programme, while the EU and Japanese grant components will help finance renewable-energy integration and technologies designed to strengthen the grid.

At EDL, the investment will upgrade the existing CEBAssist platform with Advanced Metering Infrastructure (AMI), a Distributed Energy Resource Management (DERM) system and distribution control centres supported by an Advanced Distribution Management System (ADMS).

These systems will give the utility real-time visibility of electricity consumption and distributed generation, allowing it to manage an increasingly decentralised power system more efficiently.

That digital infrastructure is critical to the business case for expanding rooftop solar.

As more SMEs and other consumers generate their own electricity, the distribution network needs to know where generation is taking place, how much electricity is entering the grid and how those flows are affecting local network conditions.

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Renault Experience Centre opens at Majestic City

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Renault has taken another significant step in its return to the Sri Lankan market with the opening of the Renault Experience Centre at Majestic City, Colombo, offering customers an opportunity to discover the brand and experience its latest models.

The Centre was officially declared open by Jawahar Ganesh, Group Managing Director of Associated Motorways (Private) Limited, accompanied by Prasanna de Silva, Director – Sales, AMW. The occasion was attended by AMW management and staff, members of the media, customers, well-wishers and other invited guests.

Located at the lobby of Majestic City, the Centre features three Renault models being introduced to the Sri Lankan market – the Renault Kwid, Renault Kiger and Renault Triber. Visitors can explore the vehicles, learn about their features and specifications, and take advantage of test drives available at the location.

Adding to the convenience for customers, AMW has ample stocks of Renault vehicles available in Sri Lanka, allowing customers to take delivery of their chosen vehicle without having to wait for months for it to arrive. Subject to completion of the necessary documentation and registration, customers can look forward to driving away in their new Renault within as little as one day, making the purchase experience faster and more convenient.

Customers can also enjoy greater peace of mind with a three-year manufacturer warranty, supported by dedicated Renault aftersales facilities to provide professional service and support throughout their ownership journey.

Commenting on the opening, Jawahar Ganesh, Group Managing Director of AMW, said, “We are delighted to welcome Renault back to Sri Lanka and to open the Renault Experience Centre at Majestic City. Renault is a brand with an exceptional heritage, a strong global presence and a reputation for innovation and distinctive automotive design. Through AMW, we are bringing that heritage and experience closer to Sri Lankan customers”.

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Dialog and Indira Cancer Trust continue breast cancer awareness initiative through Yeheli.lk

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From left to right: Dr. Sanjeeva Gunasekera, President of the Sri Lanka College of Oncologists (SLCO), and Supun Weerasinghe, Director / Group Chief Executive of Dialog Axiata PLC, illuminate the Dialog Corporate Head Office in pink, joined by Dr. Lanka Jayasuriya Dissanayake, Chairperson of the Indira Cancer Trust, alongside representatives of the Indira Cancer Trust and the leadership of Dialog Axiata PLC, in support of Breast Cancer Awareness Month.

Dialog Axiata PLC, Sri Lanka’s #1 connectivity provider, marked the beginning of Breast Cancer Awareness Month by illuminating its Corporate Head Office in pink, in partnership with the Indira Cancer Trust, to stand in solidarity with individuals and families affected by breast cancer and encourage greater awareness, regular screening and early detection.

 Building on previous breast cancer awareness campaigns conducted through Dialog’s Yeheli.lk platform in collaboration with the Indira Cancer Trust, this year’s initiative will continue throughout October under the theme, ‘A Pledge from the Heart’. As part of the campaign, members of the public can visit yeheli.lk to register for a free monthly SMS reminder and take their pledge for early detection throughout Breast Cancer Awareness Month.

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