Sri Lanka’s mineral industry is stirring from a long in-stall period, buoyed by a wave of fresh investor interest, reforming policy frameworks and a push for value-added production. According to Board of Investment of Sri Lanka Chairman Arjuna Herath, the agency has already received 14 mining and mineral-extraction proposals worth over a billion US dollars in the first nine months of 2025.
Meanwhile, the government’s draft National Mineral Policy 2023, published by the Ministry of Environment Sri Lanka, sets out a broad new framework aimed at unlocking the country’s mineral wealth, emphasising value-addition, sustainable extraction, seabed resources and tracking foreign-exchange flows.
Current Situation and Statistics: Traditional data for full 2025 are still thin, but long-term series show Sri Lanka’s total minerals-production tonnage rose from about 209,509 Mt in 2021 to 224,952 Mt in 2022.
More importantly, the heavy-mineral sands sector (ilmenite, rutile, zircon) remains under-exploited despite globally-ranked high-grade deposits studies note Sri Lanka’s share of global ilmenite production remains under 1 %.
Analysts say raw-export dominance, weak downstream processing and regulatory uncertainty have held back progress.New Government Policies & Initiatives: Under the 2023 policy the government commits to:
Create a comprehensive national inventory of mineral resources.
Encourage local value-addition (to reduce raw exports).
Strengthen regulatory and fiscal norms to attract investment and improve governance.
The stakeholder roadmap for 2025-29 further targets doubling foreign-exchange earnings from minerals such as quartz and graphite by 2029, and relaxes permitting for more common minerals such as quartz for land-owners.
Analytical Insight: The surge of investor interest reflects improving macro-sentiment—Sri Lanka’s recovery trajectory, policy clarity and high-quality deposits (especially of heavy minerals) are drawing attention. Yet turning interest into production and exports depends on government follow-through. Key challenges remain: short-term licences, high royalty burdens, raw export dominance and lack of processing infrastructure.
For the minerals sector to become a driver of economic growth, authorities will need to: (1) streamline mine-licensing to match international norms (10-15 years), (2) incentivise value-added processing abroad and at home, (3) align tax-royalty policy with global benchmarks, and (4) ensure environmental/social safeguards to make the sector sustainable.
In conclusion, Sri Lanka stands on the cusp of a mineral-industry revival. The raw materials, the investor interest and the policy blueprint are in place but the transformation from potential to production will depend heavily on policy implementation and private-public coordination. If executed well, the minerals sector could contribute significantly to export earnings, job-creation and industrialisation over the next decade.
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