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Sri Lanka targets $ 879 m in local investments in 2025

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Sri Lanka expects about $ 879 million in investments from local investors in 2025 based on government incentives and an improved investment climate in the country, Economic Development Deputy Minister Prof. Anil Jayantha Fernando said.

Speaking in Parliament yesterday (7), he said that the government forecasts $ 879 million from local investors, an assumption based on the current situation and past trends.

He also added that the figure is forecasted based on the incentive packages that the government will provide, improvement in the investment climate and maintaining policy consistency.

Fernando said that the government will provide a conducive environment for local investors where they can have a level playing field with improved ease of doing business.

Moreover, he said that forecasts for foreign direct investments (FDIs) are also made based on the assumptions made for local investors.

However, Fernando said that the government is trying to move away from these assumptions as they have not been able to attract sufficient FDIs in the past based on these assumptions.

“We are trying our maximum to get at least $ 2 billion in FDIs annually, while priority will be given to investments to bring in new technology and capital requirements,” he added.

According to a response tabled at parliament by Finance and Planning Deputy Minister Harshana Suriyapperuma in December, the Board of Investment (BOI) has signed 74 projects in 2024, with an estimated investment of $ 608 million.

The statement said that the BOI signed 41 new projects and 33 project extensions between January and December 2024, the estimated total investment in the 74 projects is $ 608 million, which is only a mere $ 110 million growth in the second half of the year after recording $ 498 million investments in the first half.

Source – The Morning

Economy

Sri Lanka ranked second most peaceful nation in South Asia

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Sri Lanka has been ranked 67th in this year’s Global Peace Index conducted by the Institute for Economics and Peace.

Sri Lanka with an overall score of 1.91 in 2026 is only behind Bhutan in the South Asian region, according to the yearly study that ranks 163 independent states and territories based on their level of peacefulness.

Bhutan is ranked 16th most peaceful nation in the world. Meanwhile, Sri Lanka was ranked 97th in the world in 2025.

The Global Peace Index measures a range of factors, including personal safety, internal and international conflict, militarization, political stability, crime, terrorism and more.

According to the 2026 report, South Asia recorded the worst deterioration in peacefulness on the 2026 GPI, with the average overall score deteriorating by 2.3 per cent. The region is ranked seventh of the eight GPI regions.

Five of the seven countries in the South Asian region deteriorated, with only two recording improvements. The deterioration was driven overwhelmingly by the ongoing conflict domain, which recorded the largest change at 7.1 per cent, reflecting escalating internal conflicts and cross-border tensions across the subcontinent.

The safety and security domain was relatively stable, while the militarisation domain recorded a small average deterioration.

Bhutan which is ranked 16th globally on the 2026 GPI was ranked 69th globally in 2008. Bhutan recorded a marginal deterioration of 0.4 per cent over the past year.

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Economy

Sri Lanka records highest-ever tourist arrivals in May

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Sri Lanka’s tourism industry achieved a historic milestone in May, recording its highest-ever tourist arrivals for the month with 145,745 visitors, surpassing the previous May record of 132,919 arrivals in 2025 and registering a 9.65% year-on-year (YoY) increase.

The strong performance comes despite challenges posed by geopolitical tensions in the Middle East, which disrupted long-haul air traffic and increased travel costs across several key markets.

The latest data released by the Sri Lanka Tourism Development Authority (SLTDA) indicate a gradual strengthening in monthly arrival momentum after several months of relatively subdued growth.

The May performance pushed cumulative arrivals for the first five months of 2026 above the 1 million mark, reaching over 1.02 million visitors. However, year-to-date (YTD) arrivals remain marginally lower, down 1% compared to the corresponding period last year.

Tourism Minister Vijitha Herath yesterday described the achievement as a significant turning point for the industry, highlighting the recovery from pandemic-era lows.

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Economy

Government to launch suburban rail electrification project from 2027

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Sri Lanka will begin a phased programme to electrify and modernise its suburban railway network starting in 2027, Deputy Minister of Transport and Highways Prasanna Gunasena announced.

It is reported that the initiative, developed on presidential instructions, will focus on two priorities: restoring damaged railway infrastructure and introducing an electrified commuter rail system. 

Officials said immediate efforts will concentrate on repairing tracks to resume services quickly, followed by slope protection measures such as retaining walls and improved drainage to minimise landslide and weather‑related risks.

In the second stage, upgrades will target key commuter corridors including the Coastal Line, the Main Line via Polgahawela and Rambukkana, and the Kelani Valley Line. 

Under the Colombo suburban rail modernisation plan, electrified services are scheduled to roll out from 2027 on the Fort–Ragama, Fort–Panadura, and Maradana–Makumbura routes. These lines will later be integrated into a wider suburban rail loop designed to ease daily travel into Colombo.

The project will introduce standard‑gauge tracks (4 feet 8.5 inches) and new electric trains to support frequent short‑distance services. 

Officials emphasized that the metro‑style commuter rail cannot be rolled out in one go due to its scale and cost, and will therefore be delivered in stages. 

The long‑term plan envisions a complete transformation of suburban transport, with full implementation expected to take between 10 and 15 years.

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