Wednesday Jan 28, 2026
Wednesday Jan 28, 2026
Wednesday, 28 January 2026 13:31 - - {{hitsCtrl.values.hits}}
Sri Lanka is witnessing a conflict that has long simmered beneath the surface but has now erupted publicly across towns and districts. What appears to be a dispute between traditional three-wheeler and taxi operators and app-based ride-hailing drivers is no longer just about passengers. It has become a broader argument about economic direction and whether the country genuinely intends to build a modern, tourism-friendly economy.
On the surface, the grievance is simple: drivers outside digital platforms argue that app-based taxis reduce their customer base and should be restricted. For years, the informal taxi economy has thrived on negotiated, inconsistent fares shaped by limited choice and information imbalance. Ride-hailing platforms disrupted that model by introducing what informal systems struggle to counter: efficiency and transparency.
And that is why the clash has escalated. Because the issue is not mobility. It is visibility.
Ride-hailing platforms did more than make transportation convenient; they shifted the balance of power between customers and service providers. By offering predictable pricing, route tracking, and greater accountability, they delivered protections the informal market often cannot match.
Most importantly, they established a clear reference point for pricing. Once customers know what a ride should cost, it becomes far more difficult to justify charging two or three times that amount, whether exploiting a tourist’s unfamiliarity or taking advantage of the lack of alternatives at a given moment.
That is why resistance has surfaced in such a forceful manner. Not because the app-based system is perfect, but because it threatens a model that relies on uncertainty.
A Tourism Reality we Cannot Ignore
What is often missing from this debate is the tourism angle, and it is not a side issue. It is central.
The strongest motivation behind the attempt to block app-based taxis is not merely local livelihood. It is also the desire to capture Sri Lanka’s booming tourism market, particularly in high-footfall areas where visitor demand creates strong daily earning potential.
But Sri Lanka must confront an inconvenient truth: a large portion of today’s tourists are not high-spending luxury travellers. They are backpackers, budget travellers, independent explorers, and lower-to-middle income tourists seeking affordable experiences. They travel with tight budgets. They plan daily spending carefully. They choose destinations based on value for money.
And one of the most important reasons these travellers are currently comfortable choosing Sri Lanka is because transport has become more transparent and affordable. The rise of app-based mobility has reduced uncertainty, reduced price shocks, and made it easier for visitors to move confidently from place to place without feeling exploited.
For the budget traveller, transport is not a minor cost. It is the backbone of the trip. If that backbone becomes unpredictable or overpriced, the destination stops feeling accessible.
Affordable Transport Feeds the Rural Economy
There is another critical point Sri Lanka must understand: the backpacker and budget tourism segment is not merely about “low spending,” but also about high mobility.
This category of traveller does not remain trapped inside luxury hotels and curated packages. They move, explore, and spend directly in local economies, particularly outside the traditional tourism hubs. Sri Lanka’s growing network of low-cost bed-and-breakfasts, homestays, guesthouses, and small family-run lodgings across the country has expanded largely because budget travellers prefer simple accommodation, provided they can move around cheaply and safely. Affordable transport makes this possible.
When transport is reasonably priced, travellers are more likely to visit smaller towns, take detours, stay extra nights in rural areas, and distribute their spending among ordinary people. This is the kind of tourism that injects money into the bottom of the pyramid: the family renting out a room, the woman running a small café, the young entrepreneur operating a scooter rental, the farmer selling fruit, and the village guide earning an honest fee.
In other words, app-based mobility is not just a transport mechanism. It is a rural economic enabler. If Sri Lanka restricts this mobility ecosystem, it does not merely inconvenience tourists. It disrupts the informal rural revenue streams that have recently emerged as a rare success story of grassroots tourism development.
This is where the argument becomes impossible to ignore. Attempts to remove or restrict app-based taxis may temporarily restore higher earnings for a limited group of operators, but they can also make Sri Lanka less attractive to the tourist segment currently driving volume.
If a backpacker arrives in Sri Lanka expecting a fair, affordable, budget travel experience, but immediately encounters inflated and unpredictable transport pricing; Sri Lanka stops feeling like value. It starts feeling like risk.
The result is not just frustration, but something far more damaging: negative travel reviews, social media warnings, and a silent shift in tourist behaviour. Budget travellers do not negotiate endlessly. They simply adjust their routes, shorten their stay, or choose a different country next time.
And when that happens, Sri Lanka does not only lose rides. It loses bed nights in guesthouses, meals in small cafés, tickets to local sites, and the daily informal spending that keeps rural tourism alive.
More importantly, it loses foreign exchange.
A Catch-22 for Sri Lanka’s Leadership
This crisis also exposes Sri Lanka’s deeper policy contradiction.
Every government wants to be associated with modernisation and promoting digitisation. It sounds forward-looking, investor-friendly, and future-ready. But when digital transformation begins to disrupt old networks and informal earning structures, the resistance becomes political.
Sri Lanka’s leadership is now trapped in a Catch-22. If the State supports app-based mobility, it risks angering informal groups that are organised and politically connected. If the State steps back and restricts platforms, it undermines national credibility and sends a message that digital systems are reversible whenever pressure is applied.
Digital transformation cannot survive if it is treated as optional or allowed only until it becomes effective. Another troubling assumption emerging in the public discourse is that consumer benefit is negotiable.
The underlying demand from anti-platform protests is not only about fairness. It is also about restoring a market where customers can be charged more because they have fewer options. But a modern economy cannot be built on the idea that consumers must accept inefficiency so that outdated pricing structures can remain profitable.
Sri Lanka is already battling high living costs, fragile household budgets, and a public exhausted by economic shocks. In that environment, denying citizens reasonable pricing and predictable service is not just an inconvenience, but an economic regression.
Sri Lanka Must Decide
This dispute has become national because it reflects Sri Lanka’s larger struggle: the desire to modernise without confronting what modernisation requires.
No economy becomes competitive by protecting inefficiency. No country grows tourism by allowing visitors to feel exploited, nor can a government claim to support digitisation while permitting digital services to be dismantled by protest.
Sri Lanka must decide between a future based on transparent systems that benefit the public, attract the modern traveller, and support rural livelihoods, or preserving an old model where price inflation is defended as entitlement. The choice is no longer theoretical. It is already unfolding on the streets.
If efficiency is blocked in the name of protecting inflated pricing power, the country will not only lose a battle over taxis but something far more valuable: trust, competitiveness, and the desperately needed tourism-driven foreign exchange.
