Quarterly Growth Report shows industrial and services sectors driving rebound despite agricultural slowdown
Sri Lanka’s economy expanded by 4.8% year-on-year in the first quarter of 2025, according to the latest Quarterly Growth Report released by the Department of Census and Statistics (DCS) on June 16. The data signals a strengthening economic recovery following the country’s worst financial crisis in decades.
The report notes that the gross domestic product (GDP) at constant 2015 prices rose to Rs. 3,477 billion in the first quarter of 2025, compared to Rs. 3,319 billion during the same period in 2024. This positive performance reflects a steady upward trajectory in national output, despite sector-specific fluctuations.
While the agriculture sector recorded a modest contraction of 0.7%, the economy was buoyed by a 9.7% increase in industrial activity and a 2.8% rise in services. The strong showing in the industrial sector, particularly in manufacturing and construction, played a critical role in lifting overall GDP. Meanwhile, the services sector continued to contribute positively, reinforcing consumer and business confidence.
The Quarterly Growth Report suggests that Sri Lanka is gradually regaining economic stability, with the expansion driven largely by production-oriented industries and a rebound in domestic demand. The government and financial analysts are expected to watch closely for sustained trends in the months ahead as the country continues its path to long-term fiscal and economic recovery.