Sri Lanka, the Pearl of the Indian Ocean, is a small island nation located off the southern coast of India. It has a population of around 21 million and a Gross Domestic Product (GDP) of $87.7 billion. The economy of Sri Lanka is largely based on agriculture, with the country producing a variety of crops such as rice, tea, rubber, and coconuts. The country also has a strong manufacturing sector, which includes the production of textiles, apparel, chemicals, and electronics. Sri Lanka also has a thriving tourism industry, with the country attracting millions of visitors each year.
Sri Lanka has seen strong economic growth in recent years, with the country's economy expanding at an average rate of 6.2% between 2015 and 2019. This growth has been driven by strong investment in infrastructure, increased foreign direct investment (FDI), and a growing middle class. The country has also benefited from its strategic location, which has allowed it to become a hub for trade and investment in the region.
Despite this strong growth, Sri Lanka still faces a number of challenges. The country is highly dependent on foreign aid and remittances, which account for around 20% of its GDP. In addition, the country has a high level of public debt, which currently stands at around 78% of GDP. Inflation is also a concern, with the country's inflation rate reaching a high of 8.6% in 2019.
In order to address these challenges, the government of Sri Lanka has implemented a number of measures. These include the introduction of a new tax regime, the liberalization of the country's trade regime, and the promotion of public-private partnerships. The government has also taken steps to improve the country's business environment, with the World Bank ranking Sri Lanka as the 48th best country for doing business in 2020.
Overall, the economy of Sri Lanka has seen significant growth in recent years and is expected to continue to expand in the coming years. However, the country still faces a number of challenges and will need to continue to implement reforms in order to ensure that this growth is sustained in the long term.