Agriculture Sector Opportunities

Earlier in March this year, the Board of Directors of the World Bank approved a $125 million loan for Sri Lanka to boost agricultural resilience and productivity for more than 470,000 small farmers in six provinces in the country's dry area.

 Sri Lanka is especially vulnerable to natural disasters such as floods and droughts due to climate. The agriculture sector, which contributes about 7.7% to the economy of the country and employs 27% of the population, more than 38% of whom are women. (Data Source: World Bank). The newly elected government is planning to develop the agriculture sector by implementing advanced technology, hence a wide range of investment opportunities are available to interested investors:

•  Foreign investors will be invited to produce innovative agriculture-related products under trade names.
• To save on fuel used for farming activities, tax-free importation of solar-powered water pumps and solar cells will be allowed.
•  Implement technological systems to promote cultivation and production of dried chillies, maize, soya, green grams and cowpea, onions, and potatoes. 
•  Small and medium enterprises will be promoted to move into areas of adding value to and processing agricultural produce. 
•    The government will identify locations to build up significant scale storage facilities for agricultural produce and intervene to build up those facilities. Hence, it will enable the domestic farmers and producers to export value-added products instead of exporting commodities in raw form. 
•  New secure railway coaches will be introduced to expand the role of the railways in goods transport. Corresponding improvements to railway infrastructure will be carried out. 
•   Tax relief will provide to private enterprises contributing to agricultural research to compensate for the research expenses they incur.

OSL Take: Sri Lanka’s agriculture sector is ripe with business/investment opportunities due to the development and upgrading of the country’s agriculture industry to be on par with global standards. The Sri Lankan Government has also taken many steps to improve the ease of doing business environment in the country and has made massive progress in infrastructure development as well. Sri Lanka’s geographical positioning, along with the many trade agreements and trade concessions enjoyed by the country makes it an attractive business destination. Therefore, foreign businesses/investors could explore setting up businesses in Sri Lanka as the base for the South Asian region.
VBS/AT/05122019/Z_1TB