Film industry pushes for end to outdated import quotas amid resurgence in cinema attendance

• Current NFC rules cap imports at 65 English, 25 Hindi, 70 Tamil and 25 other-language films, leaving cinemas short of content while streaming platforms surge
• Industry leaders highlight 2025’s record box office revenue reaching Rs. 1.5 b in 1H, with multiple Sinhala films crossing Rs. 200 m, proving local cinema is thriving without protectionist quotas
• Stakeholders warn Rs. 10 b invested in IMAX, 4K multiplexes and new theatres over seven years could be wasted if quotas persist
• Call for tax incentives and policy reforms to boost production, technology and global collaborations, positioning Sri Lanka as competitive film hub

By Charumini de Silva

Film importers and exhibitors are ramping up pressure for sweeping reforms, warning that decades-old restrictions imposed by the National Film Corporation (NFC) are crippling the Rs. 10 billion industry.

Industry leaders opined rigid annual quotas, capped at just 65 English films, 25 Hindi, 70 Tamil, and 25 other-language, such as Japanese, were introduced over 25 years ago to safeguard the local industry, but have since become a major bottleneck.

In an age of digital cinema and multiplexes, industry champions assert these limits fail to meet audience demand, despite over Rs. 10 billion being invested in upgrading theatres in the past seven years. 

They also said the average occupancy revenue rose from Rs. 7 million in 2024 to over Rs. 1.5 billion in just the first half of 2025, driven by successful Sinhala film releases, and is hopeful of ending the year with over Rs. 3.5 billion. However, industry stakeholders cautioned that without regulatory reform, growth potential will be stifled. 

“Outdated regulations under the NFC Act continue to hold back Sri Lanka’s cinema industry,” Film Exhibitors Association President Anuradha B. Rekawa told the Daily FT. 

“One glaring example is the outdated film quota system, unchanged for over 25 years. This restricts the flow of new content into cinemas, leaving exhibitors at a disadvantage, particularly against the rapid rise of streaming platforms,” he explained. 

Rekawa warned that without urgent reform, Sri Lanka risks squandering heavy investments already made by stakeholders. “We must act now to align policy with industry realities if we are to safeguard the future of Sri Lankan cinema,” he added, pointing to 2025’s surge in cinema attendance driven by blockbuster Sinhala releases and strong international films.

Sri Lanka’s modern theatres, such as the IMAX cinema at Havelock City and the 4K-equipped JP Cineplex in Kandy, have raised the bar for audience experience, with more cutting-edge venues under construction in the North and East.

Lanka Film Distributors Co., Ltd., Managing Director and Ritz Cinema Borella Owner Rakith Sugathadasa said the film quota might have made sense in the 2000s to safeguard the local cinema industry, but the situation is very different now.

“Sinhala cinema has improved tremendously. In the first half of this year alone, almost six films grossed over Rs. 200 million each, with occupancy rates of 75-78% — far better than many Hollywood blockbusters,” he added.

Aiswariya Films Director Sanjeev Thanabalasingam said having a quota of 25 Indian films per year is “ridiculous” when the industry releases multiple new titles weekly. “The industry is forced to choose between equally strong contenders,” he said, calling the quota “archaic” in the digital age.

“The laws to regulate the film industry in Sri Lanka are very old. Although industry stakeholders have adapted to the evolving demand and advancements globally, the policies to support the development of the industry are lacking,” Thanabalasingam stressed.

Industry stakeholders also pointed out that there are currently 15 Hindi and Tamil titles awaiting release through Cinema Entertainments Ltd., but the circuit has no remaining quota to bring them in. Similarly, around 24 titles from Hollywood’s major studios, including new releases and re-releases in IMAX, are scheduled, but cannot be imported under the present quota restrictions.

Scope Cinemas Chairman Naveed Cader stressed that having quotas for films interferes with international opening dates. “Simultaneous global releases are now the industry standard,” he added.

EAP CEO Ruvindhu Guneratne noted that while the policy was once intended to protect Sinhala films, local productions are now thriving. “Instead of restricting imports, we should focus on expanding both local and international opportunities for Sri Lankan cinema,” he opined.

Liberty Cinemas Ltd., Managing Director and Lanka Film Distributors Co., Ltd., Chairman Imthiaz Cader noted that local producers are now partnering with Indian producers on joint-venture projects to gain access to new technology and global marketing opportunities, including in India, Australia, Canada, and the US. 

He stressed that Sri Lanka is the only country in Asia with such foreign film import restrictions, and urged the Government to remove the quota system altogether. “We hope the Government will take this very seriously, as many cinemas where heavy investments have been made will soon run short of products,” Cader stressed.

The industry is also calling for tax incentives to support technology advancements, local film production, cinema refurbishment, and new projects—measures they said could not only elevate domestic quality but also attract international filmmakers to Sri Lanka.

“With better technology, evolving audience expectations, and growing market potential, cinema is now a matter of choice. The Government’s support in modernising these laws will help the industry reach its full potential, while contributing to cultural and economic growth,” they added.

Industry stakeholders also expressed readiness to work with the Ministry on reforms to build a dynamic, globally competitive Sri Lankan film sector.