Sri Lanka to re-invite bids for Dedduwa tourist resort after the government confirmed it will launch a fresh round of investment invitations for the long-delayed tourism project in Bentota, following the failure of previous proposals to meet financial requirements.
Sri Lanka to re-invite bids for Dedduwa tourist resort after failed investor proposals
The move is expected to revive one of Sri Lanka’s largest planned tourism developments while strengthening Bentota’s position as a diversified travel destination beyond its traditional beach tourism.
Prime Minister Dr. Harini Amarasuriya informed Parliament that the government will once again call for Expressions of Interest (EOIs) for the Dedduwa Lake-Based Tourist Resort Development Project, after earlier bids failed to satisfy financial evaluation criteria.
The proposed project seeks to transform approximately 694.54 hectares of acquired inland land surrounding Dedduwa Lake into a modern eco-friendly integrated tourism destination. Planned attractions include floating accommodation, water-based recreational activities, nature tourism experiences and agri-tourism initiatives designed to complement Bentota’s established coastal tourism sector.
According to the Prime Minister, the government had reissued Expressions of Interest and Requests for Proposals in 2026 after a previous investment agreement signed in 2022 was cancelled. However, the latest procurement process did not produce a suitable investor.
She told Parliament that although two investment proposals were received, neither applicant was able to provide sufficient financial evidence demonstrating the capacity required to undertake a project of this scale.
“As two proposals were received, neither investor submitted adequate financial proof to establish the required financial capacity. Consequently, the Development Proposal Evaluation Committee did not recommend either proposal,” the Prime Minister explained.
The Sri Lanka Tourism Development Authority will therefore move forward with another investment process after completing essential groundwork to improve the site’s readiness for potential developers.
The Dedduwa tourism project has been under development for nearly two decades. Land acquisition began around 2005 and was completed in late 2017, enabling authorities to consolidate the land required for the large-scale tourism zone.
Government figures indicate that 1,068 landowners received compensation totaling LKR 147.3 million, along with LKR 88.8 million in interest payments. Following the acquisition process, ownership of the land was transferred to the Sri Lanka Tourism Development Authority, which continues to oversee preparations for the project.
Before issuing fresh investment invitations, the government is prioritising several infrastructure improvements intended to enhance the attractiveness of the site. One of the key initiatives involves constructing a dedicated inland access road to improve connectivity between the development area and Galle Road.
The Bentota Divisional Secretariat has been assigned responsibility for acquiring an additional 27 to 30 acres of land required for the new access route, a step viewed as essential for supporting future tourism operations and investor confidence.
Authorities are also addressing several on-the-ground issues that have delayed progress over the years.
Prime Minister Amarasuriya said the Sri Lanka Tourism Development Authority, together with the Bentota Divisional Secretariat and other relevant government institutions, is currently working to demarcate land boundaries and resolve unauthorized land encroachments within the project area.
These preparatory measures are expected to create a clearer legal and operational framework before the next round of Expressions of Interest is launched.
The government believes that attracting a financially capable investor will enable the long-awaited project to proceed and deliver significant economic benefits. Beyond expanding tourism infrastructure, the integrated resort is expected to generate employment opportunities, encourage regional development and diversify Sri Lanka’s tourism offerings by promoting eco-tourism, inland recreation and sustainable travel experiences.
With infrastructure upgrades and land management work continuing, officials are hopeful the renewed investment process will attract stronger international and domestic interest, allowing the Sri Lanka to re-invite bids for Dedduwa tourist resort initiative to move beyond the planning stage and contribute to the country’s long-term tourism growth strategy.