Biggest boost to unleash digital economy

Saturday, 8 November 2025 02:12 - - {{hitsCtrl.values.hits}}

The 2026 Budget presented yesterday by President and Finance Minister Anura Kumara Disanayake has given a big boost for Sri Lanka’s aspiration of becoming a digital economy.

The Government will invest Rs. 35.6 billion to advance digitisation across the country with Disanayake expecting these measures to promote inclusive digital access.

The President said Sri Lanka has a high potential to emerge as a regional hub for setting up data centres. “There are many crucial steps that we need to take in attracting investments in data centres. To encourage these investments, an attractive environment should be created in this sector for foreign and local investors through financial incentives, green energy use incentives, low-cost electricity at the initial stage, and concessional provision of necessary land,” the President said. As an initial step, it is proposed to allocate Rs. 500 million for 2026.

He also said to accelerate the spread of digital technology, a simpler and faster unique approval process will be established for the construction of digital infrastructure facilities such as communication towers. It is proposed to suspend the tax applicable to new towers constructed under this digital technology expansion program for a period of five years.

To attract investment, a fund will be established in 2026 to accelerate the growth of the start-ups ecosystem. An initial Government grant of Rs. 1.5 billion has been allocated under the Ministry of Digital Economy expenditure head for the establishment of the fund.

It is also proposed to establish “Virtual Special Economic Zones” through the Board of Investment to practically operate in Sri Lanka, generating exports and employments.

He revealed that the first digital National Identity Card will be issued early next year saying the move will not be thwarted by short-sighted and unfounded critics.

Additionally Rs. 750 million has been allocated to establish an AI data centre.

He also said that all Government payments will be integrated into a digital payment system with service waived and QR payment charges lifted on payments below Rs. 5,000.

To improve internet coverage construction of transmission towers will be incentivised with grant of tax waiver for five years. A broadband voucher will be provided to children from Aswesuma beneficiary households to enhance online education.

Two new dedicated IT zones are planned for establishment in Digana and Nuwara Eliya under the Board of Investment (BOI) in addition to reactivating those in Galle and Kurunegala.