Draft National Industrial Development Policy out, stakeholder review sought

By Charumini de Silva

The Government is seeking feedback from stakeholders and the public on its draft National Industrial Development Policy aimed at establishing a globally competitive industry for sustainable and inclusive growth. 

The draft National Policy for Industrial Development is based on the ‘Industry Diagnosis Report,’ the compilation of which was the first step in the policy formulation process. It had found that Sri Lanka’s industrial transformation was exhibiting signs of stagnancy since the turn of the century, and that, as a result, the country’s industrial development was lagging behind that of high-performing countries in the Asian region.

In 2020, the industrial sector, which accounts for 26.2% of the economy, contracted the most – 6.9% – whilst GDP shrank by 3.6%.

The report (a) highlights the basic elements of a modern industrial policy, (b) reveals the current status of Sri Lanka’s industrial sector, (c) reviews the industry-related policies and regulations of the country, (d) provides a situational diagnostic analysis, and (e) presents an outline of policy needs.

There are nine aspects the policy focuses, including the following: Enabling environment for industry growth; competitive integration with international markets; state-of-the-art and resilient infrastructure for industry; knowledge-based and creative industry; digitalisation and transformation into Industry 4.0; technologically advanced, innovative and dynamic Small and Medium Industries (SMIs); diverse and integrated regional industrialisation; disaster, pandemic and climate resilient industry and greener industry for sustainable development.

According to Industrial Ministry sources, the necessity of a strong and consistent policy in enhancing the industrial sector’s competitiveness and helping overcome impediments to industrial development through the advancement of green growth and digitisation, was highlighted in President Gotabaya Rajapaksa’s ‘Vistas of Prosperity and Splendour’ national policy framework. 

Among the key issues addressed through the policy were the challenges and opportunities associated with the Fourth Industrial Revolution (4IR) and the gradual global transition towards a green economy. 

Therefore, sources said economic considerations should be approached together with environmental sustainability and digitalisation. The principles of the circular economy, and of sustainable consumption and production standards, are the cornerstones of modern industrialisation. They enhance international competitiveness, buttressed by a futuristic focus on the 4IR, in which digitalisation and the virtual economy play an important role.

The policy, with its long-term perspective, has a minimum timeline of 15 years and will be operationalised through a set of strategies. A mid-term strategic plan will be prepared with the vision to “establish a globally competitive industry for sustainable and inclusive growth of Sri Lanka,” sources added. 

In the strategic plan, the duration of which will be around three to five years, there will be different strategies followed by activities to achieve policy goals. This strategic plan could be revised periodically, taking into consideration national as well as international circumstances, while following the long-term direction set by the policy. 

The Department of National Planning has the sole responsibility for monitoring and evaluation, either independently or in collaboration with the Ministry of Industries.