Sri Lanka's Institute for Policy Studies states that Sri Lanka must now convert its strong cyclical growth recovery to a structurally driven growth process.

The IPS’ annual flagship report Sri Lanka: State of the Economy 2025 analyses such confluence of forces to better understand how the current cyclical recovery can be converted to a structurally driven growth path.

Technology infusion and digitalisation is identified as a powerful engine to deliver cost-effective economic gains sooner rather than later.

There are acknowledged shortcomings; national computer literacy remains relatively low (39%) with significant disparities (at 17.9% in the estate sector).

But, there are also significant opportunities to be tapped. Digital innovation opportunities can improve access to health, education, and government services to help bridge some of these inequities.

For instance, investing in digital access for underprivileged schools, combined with support for affordable digital services and digital literacy, can help narrow ongoing education gaps.

Nearly 42% of Sri Lankan adults among the poorest 40% are found to use digital payments. It bodes well to develop Sri Lanka’s growing e-commerce sector or to improve safety and convenience of the country’s public transport system.

Widespread access and scalability through digital channels on extension services can help farmers.

In an environment of global trade uncertainties, lowering the costs of doing trade and enhancing export competitiveness through product traceability to meet new regulations in the global market will be distinct advantages.

These are some of the ways in which productivity-improving technology and digital solutions that enable more efficient ways of doing things can underpin government ambitions to foster growth.

In doing so, Sri Lanka can build an inspiring narrative of a robust post-crisis economic recovery and sustained growth as it prepares to resume its debt service obligations.