• Only essential goods being imported
• Exports rise but insufficient to cover import expenses  
• Focus on increasing domestic production via co-ops

Sri Lanka is unlikely to see a significant reduction in its import bill in the immediate future, with most current imports being essential goods, but the Government expects to bring down import expenditure within the next one to two years by increasing domestic production and exports, the Trade, Commerce, Food Security and Cooperative Development Ministry stated. 

Speaking to The Daily Morning yesterday (31 August), Deputy subject Minister R M Jayawardena said Sri Lanka is now importing mainly essential goods and could not simply stop imports altogether. “Most of what we import at present is essential goods. We can’t restrict those imports. Domestic production has increased to some extent, but we still don’t have the capacity to completely stop imports,” he said.

He also said that while exports had increased, the country’s export earnings are still not enough to cover its import expenditure. "The rise in the value of the United States Dollar has also increased the amount that Sri Lanka has to pay in Rupees for imported goods. This has pushed up the import bill in numerical terms. At the same time, the Middle East war situation had contributed to higher prices for some essential imports. We are not importing unnecessary goods at present. But, we have still not been able to reduce import expenditure to a significant extent,” he said.

Speaking further, Jayawardena said that the Government is now looking to increase domestic production through co-operative societies and use the additional output to boost exports. "The Government has also extended the validity period of the surcharge imposed on vehicle imports. Through these measures, we expect to be able to reduce import expenditure within another one or two years.”

Reducing import expenditure is important for countries such as Sri Lanka, where foreign exchange earnings have to be carefully managed to meet payments for essential imports such as fuel, food, medicine and industrial inputs.