By: Staff Writer
September 11, Colombo (LNW): In a major move to stimulate regional economic growth, the Sri Lankan Cabinet has approved leasing land for 38 new manufacturing projects nationwide, alongside the allocation of 64 acres for a dedicated food processing and packaging industrial zone in Dambulla. The announcement, made yesterday by Health and Mass Media Minister Dr. Nalinda Jayatissa, underscores the government’s push to decentralise industrial development and attract investment outside traditional urban hubs.
The 38 approved manufacturing projects are estimated to involve a combined investment of Rs. 2.5 billion and are projected to generate 1,559 direct jobs. Land leases for these projects will extend up to 35 years, providing long-term operational security for investors. According to Dr. Jayatissa, the projects were carefully vetted: 42 proposals were initially recommended by the Regional Industrial Service Committee, with final approval granted by the Ministry of Industry and Entrepreneurship Development’s Project Evaluation Committee.
The land allocations cover a wide range of locations, including Ampara, Trincomalee, Batticaloa, Kalutara, Minuwangoda, Matugama, Millaniya, Ulapaney, Ratnapura, Nalanda, Karandeniya, Bata Atha, Mannar, Galigamuwa, Embilipitiya, Buththala, Dankotuwa, Puttalam, and Aluthapola. This regional spread reflects an effort to stimulate local economies, reduce urban concentration, and create employment opportunities in underdeveloped areas.
The Dambulla industrial zone, designed specifically for food processing and packaging, will initially develop 24 acres in the first phase, with Rs. 750 million earmarked this year for infrastructure support. The establishment of such sector-specific zones signals the government’s recognition of targeted industrial clustering as a potential driver of efficiency, innovation, and export competitiveness.
However, while the plan promises economic benefits, several challenges and potential repercussions warrant scrutiny. Leasing land for extended periods can strain public resources and reduce flexibility for future planning. Ensuring that the promised investments materialise and that projects meet environmental, social, and labour standards is critical. Historical experience with underutilised industrial estates raises concerns about effective monitoring and project execution.
Sri Lanka currently operates 33 industrial estates nationwide, with seven more under development under the Regional Industrial Development Program. Expanding this network requires careful planning to balance regional development with sustainable resource management, infrastructure capacity, and local community interests.
Industry analysts note that while long-term land leases and dedicated zones can attract private investment, the government must ensure transparent selection processes, timely infrastructure provision, and robust oversight. Without these safeguards, there is a risk that ambitious plans may deliver limited economic impact or exacerbate regional inequalities.
The Cabinet’s latest approvals reflect a proactive approach to fostering industrial growth and regional development, yet the effectiveness of these initiatives will ultimately depend on implementation, investor accountability, and strategic alignment with broader economic objectives.
