More than 380,000 people across Sri Lanka are expected to benefit from a new US$100 million partnership between the Government of Sri Lanka and the World Bank Group, aimed at strengthening rural livelihoods, creating jobs, and building climate resilience in the agri-food sector.
The Integrated “Rurban” (Rural and Urban) Development and Climate Resilience Project will directly support 8,000 agri-food producers, improve irrigation and drainage services on 71,000 hectares of land, and help smallholder farmers adopt modern, climate-smart agricultural practices to boost harvests and reduce losses. It also seeks to generate new employment opportunities in rural areas—particularly for youth and women—by strengthening agribusiness value chains and expanding market access.
“The National Policy Framework of the Government, ‘A Thriving Nation – A Beautiful Life,’ has given utmost priority to achieving sustainable economic growth and development through a robust production economy,” said Dr. Harshana Suriyapperuma, Secretary to the Treasury and the Ministry of Finance, Planning and Economic Development. “This project financed by the World Bank, one of Sri Lanka’s prominent development partners, will complement the Government’s vision by enhancing agricultural productivity, stimulating rural development, and safeguarding food security.”
Smallholder farmers, who produce about 80 percent of Sri Lanka’s food, are at the center of the initiative. With climate change bringing more unpredictable rainfall, rising temperatures, and extreme weather events such as floods and droughts, the project will prioritize upgrading irrigation systems, promoting climate-smart technologies, expanding crop insurance, and investing in resilient infrastructure to help farmers better withstand climate-related shocks.
The project will also modernize agricultural data systems, improve food safety standards, and enhance global competitiveness for Sri Lankan farmers, opening new export opportunities.
“This project is about people, government, and the private sector working together to make real improvements on the ground,” said David Sislen, World Bank Division Director for the Maldives, Nepal, and Sri Lanka. “By combining climate-smart farming with access to markets and private finance, we are not just helping farmers adapt to climate change—we’re helping them succeed in spite of it.”
Additionally, the project aims to attract up to US$17 million in private investment by linking farmers with financial institutions, unlocking loans for agribusinesses, and creating new income opportunities in processing, storage, logistics, and marketing.
The initiative builds on over a decade of World Bank Group support to Sri Lanka’s agriculture sector, which has led to the creation of 141 farmer organizations and farmer-owned businesses, boosting average farmer sales by 44 percent. The International Finance Corporation (IFC), the World Bank Group’s private sector arm, has also strengthened key export industries such as cinnamon and coconut through technical expertise, financial tools, and digital support for small and medium-sized enterprises.
Aligned with Sri Lanka’s national development goals and the World Bank Group’s Country Partnership Framework, the project reflects a shared commitment to building a stronger, more inclusive, and climate-resilient rural economy.
