Transport, Highways and Urban Development Minister Bimal Rathnayake says ongoing construction projects across Sri Lanka remain uninterrupted despite the Middle East conflict, citing the Central Expressway Phase III as the benchmark.
In a video statement on his official Facebook page, the Minister said work on the Pothuhera–Rambukkana section of Phase III was approximately 75% complete as of March, and that the extension to Galagedara was progressing at a steady pace. He said authorities were working to keep all major projects on timeline despite external pressures.
The assurance comes as rising Hormuz-driven fuel and input costs feed through to construction budgets. CT Smith Securities said in a recent note that the sector is nonetheless entering an expansion phase, supported by reconstruction demand and a multi-year public investment pipeline worth around Rs. 2 trillion for 2026-2028, largely targeting infrastructure.
Near-term demand is being amplified by rebuilding from Cyclone Ditwah, with damage estimated at around Rs. 878 billion. CT Smith cautioned, however, that rising input costs, tight financing conditions and potential energy shocks linked to the Middle East standoff could squeeze project timelines and margins, particularly for smaller contractors.
Construction typically grows faster than headline GDP in post-crisis periods, the brokerage said, but exposure to imported materials and fuel makes the sector sensitive to the renewed oil price volatility triggered by the Hormuz closures.
Phase III of the Central Expressway is designed to link Pothuhera with Galagedara via Rambukkana, shortening road travel times between Colombo and the hill country. The Pothuhera–Rambukkana stretch is the most advanced of the Phase III packages currently under construction.
Source: Daily FT.
