Connect with us

Business

Lessons for Colombo from Manila, Bangkok and Hong Kong

Published

on

The traffic-clogged streets of Colombo (File photo)

Troubled Transportation:

IPS Policy Insights

One of the most critical implications of Sri Lanka’s current economic crisis is the hard hit on the transport sector. The foreign exchange shortage has made importing fuel a major challenge, severely affecting road transportation and further impeding the performance of an already crippled economy. This Policy Insight gives context to the ongoing transportation issues in Sri Lanka and offers medium- and long-term solutions to address the issues, based on lessons learnt from the experiences of Manila, Bangkok and Hong Kong.

Poor Public Transportation

The transportation sector in Sri Lanka absorbs a fair share of petroleum imports to the country and has a very low price elasticity. Despite the many price hikes in 2021, the Ceylon Petroleum Corporation (CPC) sold a total of 3.6 billion litres of petroleum products to the transport sector, which was higher than the average of 3.4 billion litres sold from 2015 onwards. This trend of high demand continues even during the historically high petroleum product price in 2022.

A key reason for this consistently high demand for fuel, particularly in commercial capital of Colombo, is the combination of the overreliance on private transportation and the weak public transportation system. The decline in the public transport sector amidst the above-mentioned consistent high demand for petroleum products in 2021 reflects the inadequate contribution of public transportation towards the transport sector in Sri Lanka. When the demand for petroleum products in 2021 was above the previous period’s average, the operated kilometrage and passenger kilometrage of the public operator Sri Lanka Transport Board (SLTB) declined by 19.7 per cent and 28.4 per cent, respectively, while the corresponding contractions in the private transport sector were 4.4 per cent and 2.2 per cent, respectively. Some part of the decline in public transportation in 2021 can be attributed to COVID-19 related social distancing requirements in travelling. As such, amidst the severe financial crisis with the lack of capacity to import fuel in a timely manner and rising fuel prices due to global and exchange rate pressures, the key solutions to the transportation problem lie in improving the public transportation sector and exploring alternative means of transportation.

Grand Policies and Plans

Sri Lanka has undergone various planning and policy contexts in relation to public transportation. During the 2010-2015 period and its The Emerging Wonder of Asia development framework, the transport sector buzzwords included Bus Rapid Transit (BRT), Light Rail Transit (LRT) and Mass Rapid Transit (MRT). During the 2015-2019 period and its Western Region Megapolis Master Plan, the hype included the Rapid Transit System (RTS), the bus system, the rail system, the road system and the already heard LRT. In the most recent Vistas of Prosperity and Splendour framework, the lingo was peppered with a ‘park and ride’ system, metro rail system, radial and circular road system and the now familiar LRT. Despite varied packaging to cater to the administration’s approach, most of these public transportation-related efforts during the last decade were broadly connected to the National Physical Plan (NPP).

LRT Drama

All previous policy frameworks have recognised the importance of developing an LRT system to ease congestion in transport and commuting but several reasons delayed its implementation. The approval from the Central Environment Authority (CEA) for the LRT was received at the latter part of 2018. There were delays in drafting a framework to regulate the LRT system. Subsequent to fulfilling these, in 2019, the Japan International Cooperation Agency (JICA) expressed willingness to provide a soft loan of USD 1.85 billion out of the total estimated investment of USD 2.2 billion for a LRT connecting Malabe and Fort. This included a 12-year grace period, 40-year payback period, and yen interest rate of 0.1 per cent. By June 2020, Sri Lanka has already signed the agreement with JICA for a loan tranche of USD 270 million, preliminary work had begun, and a contract was signed with a project consultancy firm for USD 130 million. However, in 2020, the project was abruptly halted, the agreement with JICA was reversed and steps were made to seek new proposals from private investors under a Public-Private Partnership (PPP) arrangement.

The ever familiar – yet illusive LRT came to the forefront once again in 2022 when Sri Lanka attempted to woo Japan to extend support during the ongoing economic crisis. Sri Lanka has written to the Japanese Prime Minister requesting financial support while extending “deep regret in scrapping the LRT” project in 2020. Still, it is unclear why the soft loan from Japan was rejected in favour of a PPP and to date, public transportation in Sri Lanka is at an incipient level. When Sri Lanka returns to a position to consider such investments, there should be no room for further policy or planning mistakes or back paddling.

Lessons for Colombo

There are several lessons to be learnt based on the experiences of Metro Manila, Bangkok and Hong Kong which are case studies that Sri Lanka’s transport sector can refer to in its efforts to develop public transportation.

Metro Manila’s experience demonstrates the importance of creating a master plan and sticking to it. One such approach is legalising the transportation plan. This would make it more difficult for a project to be postponed or disbanded when governments change. Another option is to garner support from the government, opposition and the public. If the public supports the initiative, the prospective government or the opposition, has a greater incentive to complete it.

Bangkok’s experience shows how successfully managed PPPs have assisted the development of infrastructure projects without burdening the government. In the case of the Bangkok Mass Transit System (BTS) Sky Train, the government did not provide any funding and as a result, does not face any risk associated with the operation of the light rail. A private company providing 100% of the funding and taking the aggregate risk for a project may be extreme in the Sri Lankan context. But it demonstrates that Sri Lanka can be on the lookout for a private company to finance and potentially fund part of a public transportation project.

Similarly, Hong Kong demonstrates how a private company can successfully run a mass transit system and profit by investing in its train stations and developing rental space. This success was mainly hinged upon Mass Transit Railway (MTR)’s capacity to develop the land and receive the rental income and the conducive environment in Hong Kong to do so. As such, incorporating rental space into transportation investments in Sri Lanka could pave the path for future investments in public transportation to become profitable.

However, a PPP should not be considered a “silver bullet” for Sri Lanka’s public transportation issues. Bangkok’s experience showed that projects developed on a piecemeal basis lack integration and become less efficient. As a result, Bangkok’s Purple Line stops 1 kilometre away from the blue line at a different station. If Sri Lanka is to pursue PPPs for public transportation, an integrated approach where a transportation system is considered as a whole instead of a collection of independent projects in critical.

This Policy Insight is based on the new IPS publication ‘Towards a Developed Urban Transportation System: Lessons for Sri Lanka’ by Bilesha Weeraratne and Chathurga Karunanayake. The complete report can be purchased from the Publications Unit of the IPS located at 100/20, Independence Avenue, Colombo 07 and leading bookshops island wide. For more information, contact 011-2143107 / 077-3737717 or email: publications@ips.lk.

To download more POLICY INSIGHTS from IPS, visit: https://www.ips.lk/publications/policy-insights.



Continue Reading
Click to comment

Leave a Reply

Your email address will not be published. Required fields are marked *

Business

India’s rise in manufacturing sector seen as holding out possibilities for SL

Published

on

India’s rise in manufacturing sector seen as holding out possibilities for SL

India’s rapid rise as a global manufacturing hub and consumer market is reshaping South Asia’s apparel landscape, creating both urgency and opportunity for Sri Lanka to reposition itself through deeper regional integration, Acting Indian High Commissioner to Sri Lanka Dr. Satyanjal Pandey said recently at the Sri Lanka Apparel Exporters Association (SLAEA) Annual General Meeting in Colombo.

Addressing industry leaders at Cinnamon Life, Dr. Pandey said the next phase of growth in South Asian apparel will be driven not by competition within the region, but by collaboration across it, particularly between India and Sri Lanka.

“India and Sri Lanka bring very different but highly complementary strengths, he said. “India offers scale, raw materials, a vast labour pool and a rapidly expanding domestic market. Sri Lanka brings world-class manufacturing standards, compliance, speed, flexibility and trusted relationships with premium global brands. Together, these strengths can create globally competitive regional value chains.”

Dr. Pandey revealed that India had concluded a major trade agreement with the European Union earlier in the day, granting tariff-free access across more than 9,000 product lines, including apparel, with tariffs reduced from 12 percent to zero.

The agreement, he noted, reinforces India’s growing centrality in global trade and underscores the need for Sri Lanka to move swiftly in aligning its trade and investment strategies with regional developments.

He stressed that India’s objective is not to displace Sri Lankan apparel producers, but to grow together in an increasingly complex global market where buyers are demanding resilience, sustainability and regional diversification.

India today is one of the world’s fastest-growing major economies, with a large and youthful population, expanding middle class and rising apparel consumption. For Sri Lankan manufacturers, this presents opportunities not only as a sourcing partner, but also as an export destination for value-added apparel, technical textiles and sustainable fashion.

Against this evolving landscape, Sri Lankan industry leaders highlighted the urgency of aligning domestic policy and regulatory frameworks with India’s accelerating trade momentum.

Sri Lanka Exporters Association chairperson Ms. Rajitha Jayasuriya said global regulatory compliance has become a prerequisite for market access, particularly in Europe.

She pointed to the EU’s Corporate Sustainability Due Diligence Directive (CSDDD), enhanced traceability requirements and Digital Product Passports (DPPs) as measures that will increasingly shape trade flows.

“These are no longer optional standards. They are a licence to operate, she said, adding that Sri Lanka must urgently build national support systems to help SMEs and supply chain compliance through transparency, sustainable materials and robust data systems.

Jayasuriya warned that failure to secure the renewal of Sri Lanka’s GSP Plus facility would further weaken competitiveness, especially as India strengthens its trade position with the EU.

“With India moving ahead rapidly, Sri Lanka must mobilise faster to protect preferential access and avoid erosion of market share, she said.

India also featured prominently in the industry’s forward-looking trade agenda.

Jayasuriya said priorities for 2026 include securing quota-free access to the Indian market, ensuring predictable trade flows and deepening Sri Lanka’s integration into India-centric regional value chains.

“A stronger India–Sri Lanka apparel corridor is not just an economic opportunity; it is a strategic imperative, she said.

Policy reform at home was identified as a critical enabler of regional integration.

Jayasuriya called for accelerated digital reforms, including the introduction of a fully fiscalised e-invoicing system for exporters, to improve liquidity, compliance and transparency.

She noted that countries such as India have already moved ahead in this area, strengthening their competitiveness.

The apparel industry’s performance in 2025, she said, demonstrated what is possible when factory-level resilience is matched by responsive policymaking. However, she cautioned that regional competitors such as Cambodia, Vietnam and Bangladesh continue to move aggressively on scale, automation and trade agreements.

By Ifham Nizam

Continue Reading

Business

Arpico NextGen Mattress gains recognition for innovation

Published

on

(From Left – Right) Arpitech (Pvt) Ltd, Richard Pieris & Company PLC, represented by Lalith Wijeyesinghe, Managing Director, and Jayanatha Alwis, Deputy General Manager - Manufacturing, accept the award and certificate for the Innovative Product of the Year Award

Arpico, the longstanding frontrunner in Sri Lanka’s mattress industry, recently received the award for 2nd Runner-Up in the category of Innovative Product of the Year at the 2025 PRISL Industry Awards. Hosted by the Plastic and Rubber Institute of Sri Lanka (PRISL), the awards honour outstanding industry contributions to the plastics, rubber, latex, and recycling sectors.

Awarded for Arpico’s NextGen mattress, the recognition reaffirmed the company’s commitment to crafting state-of-the-art sleep solutions and providing its customers with seamless retail experiences.

The Arpico NextGen mattress stands as a distinctive example of Arpico’s vision. With its inclusion of profile-cut air-cooling pocket technology, the NextGen mattress is the product of intensive research and development, designed to align with Arpico’s mission to innovate products that enrich everyday living. Built using cutting-edge German Computer Numerical Control (CNC) foam-cutting technology, the NextGen’s design aims to amplify cooling, essentially enhancing sleep quality through its superior comfort, adaptive support, and long-lasting performance, allowing sleepers to wake rejuvenated.

Discussing the award, Lalith Wijeyesinghe, Managing Director of Arpitech (Pvt) Ltd, Richard Pieris & Company PLC, said, “The award is a testament to the efforts and ingenuity of our team, led under the visionary guidance of our Group Chairman, CEO, and Managing Director of Richard Pieris & Company PLC, Dr Sena Yaddehige. It reaffirms our endeavours to design products that integrate emerging technologies for the benefit of our customers. Furthermore, we recognise the award as an incentive to continue pushing the boundaries of our achievements and pursue ever greater heights of success.”

 Arpitech (Pvt) Ltd is a leading trailblazer in polyurethane foam and spring mattresses, sheets, cushions, and siliconised fibre pillows, backed by a corporate legacy spanning over four decades of manufacturing excellence. The company upholds the highest quality standards, having secured the prestigious ISO 9001:2015 certification. Furthermore, Arpico adheres to the SLS standard for its acclaimed Arpifoam. Renowned as a trusted brand, Arpitech (Pvt) Ltd draws from the 90-year legacy of its parent company, the Richard Pieris & Company PLC. From a modest beginning as a filling station in 1932, Richard Pieris & Company has grown into one of Sri Lanka’s most diversified business conglomerates with interests in retail, plantations, rubber, furniture, tyres, plastics, insurance, stockbroking, financial services, and logistics. It is one of the largest listed entities on the Colombo Stock Exchange, with a remarkable annual turnover.

Continue Reading

Business

Advice Lab unveils new 13,000+ sqft office, marking major expansion in financial services BPO to Australia

Published

on

Advice Lab, a leading provider of financial services BPO solutions to the Australian market, announced the opening of its new 13,000+ square‑foot office in Colombo, one of the most modern and dynamic workspaces in Sri Lanka. The move marks a significant milestone in the company’s rapid growth as a BPO and highlights its ongoing commitment to creating valuable job opportunities across Sri Lanka’s professional workforce.

The state‑of‑the‑art facility has been thoughtfully designed to support the company’s expanding operations and its growing portfolio of Australian financial advisers, accountants, and mortgage professionals. Purpose‑built for scale and efficiency, the workspace accommodates larger teams and advanced technology infrastructure while prioritizing employee well‑being and productivity. This emphasis on a people‑first culture is reflected in the inspiring, comfortable, and energizing environment created throughout the new office.

Continue Reading

Trending