Sri Lanka: Rehabilitating Roads to Connect People to Prosperity

Overview

In order to facilitate the Government of Sri Lanka’s (GOSL) targeted growth rate of 6-8 percent over the next five years, infrastructure development is paramount. With 19 million people, Sri Lanka has a road network of about 108,000 kilometers. It is a vital component for the movement of people and goods and as such, plays an important role in integrating the country, facilitatiCng economic growth, and ultimately reducing poverty. The Road Sector Assistance Project has resurfaced over 620 kilometers of roads, improved the condition of national roads, and reduced average vehicle operating costs.

Challenge

Years of poor road maintenance have resulted in low travel speeds hindered the spread of economic activities and development outside the Colombo Metropolitan Area. Conditions and standards of the roads were inadequate to meet rapidly growing freight and passenger traffic. More than 50 percent of the national roads had poor or very poor surface condition and many were seriously congested. In spite of the substantial increase in traffic volume, there was insufficient investment in the construction of new highways or widening and improving existing roads. Some of the major issues in the transportation sector included: lack of connectivity and low capacity of highways to connect major growth centers; severe deterioration of provincial and local roads; traffic congestion in town centers; lack of enforcement of traffic regulations; poor condition of railways and deteriorated services.

Approach

The Road Sector Assistance Project was designed to lower transportation costs and travel times by improving the condition of national highways, which are the backbone of Sri Lanka’s economy. This improvement would help farmers transport their produce to markets on time, increase export competitiveness, accelerate export-led growth and contribute to sustained economic development. Furthermore, improved roads would greatly benefit the tourism industry, allowing the country to reap the benefits of the cessation of the conflict.

Results

• Resurfaced and improved 620 kilometers of roads.

• Reduced the national highways in poor condition from 52 percent in 2005 to 38 percent in 2010.

• Provided innovative pilot schemes for the rehabilitation of rural roads in three provinces. The results from the pilot have equipped the GOSL with a strategy for the rehabilitation of its rural network, which is now being implemented with government funding.

• Encouraged the Government of Sri Lanka to increase annual maintenance investments from US$13 million in 2005, to US$30 million in 2006, and US$46 million in 2010.

• Average Vehicle Operating Costs for the National Highways reduced from Sri Lankan Rupees (LKR) 23.9/kilometer to LKR 15.37/kilometer.

Voices

The improvement in the road surface has reduced the vehicle operating costs as we use less fuel and there is less wear and tear on the tires.

— Anurasiri

Map

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Bank Contribution

From the late 1960s to the mid-1990s, IDA has provided four loans to improve Sri Lanka’s roads and assisted in the development of sector policy. In 2005, the Bank approved a US$100 million IDA credit for the Road Sector Assistance Project to finance the rehabilitation and upgrading of the country’s national highways and support the government’s reform initiatives for financing sustainable road maintenance. Additional funding through an IDA credit of US$98 million was provided in 2008 to meet increased expenditure due to the increase in prices in oil-based construction materials because of global oil price increases. The assistance to the road sector by the Bank was provided within the program outlined in the National Road Sector Master Plan.

Partners

The World Bank, the Japan Bank for International Cooperation (JBIC) and the Asian Development Bank (ADB) agreed in November 2004 to coordinate their activities in the sector to reach medium term goals. Sector reform is being undertaken around three pillars as follows: (i) strengthening the Road Development Authority (RDA); (ii) establishing a mechanism and providing sustainable funding for road maintenance financing; and (iii) developing the domestic private sector in the road industry.

The World Bank agreed to take the leadership in addressing the issue of sustainable road maintenance financing, the second pillar of the sector reform framework. The JBIC agreed to take forward the issue of private sector development in the road construction industry, and the ADB will continue taking the lead in institutional strengthening and capacity building of the RDA.

Toward the Future

The project will continue to lower transportation costs through sustainable delivery of an efficient national road system. The outcome is on track and continued support will help ensure that it is ultimately achieved. In response to the successful achievement of the national roads component, it is being scaled up to include further rehabilitation of the national road network.