Sri Lanka economy is expected to grow by 9.3% by 2030 under the proposed Japan-Sri Lanka-India Export-Oriented Industrial Corridor, which aims to deepen trade, investment, and manufacturing integration with regional partners.
Sri Lanka economy to gain 9.3% by 2030 from Japan-India industrial corridor plan.
Sri Lanka economy is projected to expand by 9.3% by 2030 through the proposed Japan-Sri Lanka-India Export-Oriented Industrial Corridor, according to a study unveiled at the Sri Lanka Business Forum in Tokyo. The initiative, led by Japan’s Ministry of Economy, Trade and Industry (METI), JETRO, and Nomura Research Institute (NRI), is designed as a complementary collaboration between Sri Lanka, India, and Japan, with the goal of creating a seamless flow of technology, investment, and trade opportunities.
The corridor will function as a strategic economic pathway, connecting Sri Lanka’s geographical advantage with Japan’s technological expertise and India’s large-scale market. Japan sees this as a key strategy to deepen its longstanding partnership with Sri Lanka while expanding opportunities for its companies in the region. There are currently more than 5,000 Japanese companies in India and over 100 in Sri Lanka, with over 30% engaged in manufacturing. This corridor is expected to create a stronger export hub, helping integrate Sri Lanka into global value chains.
The roadmap, presented by METI Director for Southwest Asia Region Shimano Toshiyuki, identified three priority sectors for development: electrical and electronic components, mineral resources, and agricultural resources. The initiative will support Sri Lanka’s efforts to transform raw materials into higher-value products, enhance competitiveness, and drive export-led growth. Preliminary analysis also examined India’s import dependencies, Sri Lanka’s export strengths, and how targeted industrial development can fill regional supply gaps.
According to projections, the corridor will not only boost Sri Lanka economy but also increase India’s GDP by 1.28%, Bhutan’s by 0.4%, and Nepal’s by 0.2%. To achieve this, the roadmap outlines steps to overcome both “hard” and “soft” barriers. Hard issues include logistical inefficiencies at Colombo Port, limited transport connectivity, energy constraints, and mineral processing gaps. Proposed solutions involve expanding and modernising port facilities, enhancing energy and transport infrastructure, and developing dedicated industrial zones.
On the soft side, regulatory complexities, approval delays, and investment policy gaps remain key challenges. The plan proposes simplifying approval processes through digital solutions, improving mutual understanding between Sri Lankan and Indian businesses, and introducing comprehensive investment incentives and streamlined certification systems to facilitate trade.
The roadmap also proposes establishing a multilateral working group, implementing bilateral measures, and increasing private sector involvement. Through targeted policy interventions, infrastructure upgrades, and coordinated dialogue, the initiative aims to unlock significant economic benefits. Analysts note that such a corridor could position Sri Lanka economy as a regional hub for export manufacturing, enhancing resilience and competitiveness across South Asia.
Japan views this initiative as more than a trade strategy—it’s a long-term investment in strengthening economic ties and expanding sustainable industrial cooperation. If successfully implemented, the corridor could transform Sri Lanka into a critical link in global supply chains while driving inclusive economic growth for the entire region.