Sri Lanka clears hurdles to China-backed expressway, targets 2028 completion

Sri Lanka expects to complete the Kadawatha-Mirigama section of the China-backed Central Expressway by 2028 after resolving financial and contractual problems that had complicated the project, Deputy Minister of Transport and Highways Dr Prasanna Gunasena said.

Gunasena said the project had become entangled in issues related to Chinese financing, compensation payments and other contractual obligations following delays to construction.

The Government had since worked through those problems, allowing construction to move forward, he said.

“The transaction involving the Chinese loan had become tangled like a ball of thread,” Gunasena said, adding that every additional day of delay had increased the compensation Sri Lanka was required to pay.

He said the Government had now reached a position where construction could proceed and expected the section to be completed by 2028.

The Kadawatha-Mirigama stretch forms the first section of the Central Expressway, which is intended to improve road connectivity between the Colombo metropolitan area and central Sri Lanka.

Construction of the section was disrupted during Sri Lanka’s severe economic and foreign exchange crisis, which began in 2022 and affected several foreign-funded infrastructure projects.

Work later resumed, but financial and contractual issues continued to complicate implementation.

Gunasena said restarting major infrastructure projects that had stalled was a key part of the Government’s transport programme during its first two years in office.

The Government is also moving ahead with other sections of the Central Expressway.

Gunasena said work was being advanced on the route towards Galagedara, one of the technically more difficult sections because it passes through mountainous terrain.

The Government also plans to proceed with the Kurunegala-Dambulla section and other expressway projects, including the first stage of the proposed route towards Ratnapura.

He said some of the new infrastructure work would be financed with domestic funds, although major projects would still require substantial foreign exchange for imported machinery, construction materials and technology.

Sri Lanka is seeking to accelerate infrastructure investment while maintaining foreign exchange stability following the economic crisis, Gunasena said.

The Government has also announced plans for major railway investment, including a railway electrification programme estimated to cost around Rs. 600 billion.