“There is no planet B”
View(s):Taken for granted
All 25 districts of Sri Lanka are traversed by rivers and perennial watercourses, their paths sculpted by the island’s diverse topography. These waterways carve out distinct ecological zones, shaping patterns of land use, agriculture, and human settlement.
As they journey downward from the central highlands, rivers become the lifeblood of rural economies. They feed intricate irrigation networks that sustain rice paddies and other crops, power hydroelectric stations, supply drinking water, and support small-scale fisheries in downstream communities.
Eventually, these rivers reach the coast, nourishing estuaries and lagoons and linking inland populations to marine ecosystems. This transition—from upcountry to ocean—is more than a geographic shift; it forms an integrated economic corridor, connecting rain-fed agriculture in the highlands to coastal livelihoods, trade, and biodiversity.
Yet, because these rivers have always been part of our landscape, we often overlook their significance. Familiarity breeds invisibility. We’ve grown accustomed to their presence—taking for granted the vital role they play in our economy, our ecosystems, and our everyday lives.
More than geography
Sri Lanka’s rivers are far more than geographic features—they are dynamic economic arteries that shape livelihoods, ecosystems, and development across the island. Originating in the central highlands, their descent from mountain to sea nourishes diverse landscapes and sustains communities along every stretch.
In the uplands, fast-flowing rivers drive Sri Lanka’s renewable energy grid, reducing reliance on fossil fuels. Rain-fed slopes, enriched by river-fed microclimates, support the globally renowned tea industry and highland agriculture. Forested upper catchments regulate water flow, minimise erosion, recharge aquifers, and balance carbon cycles—delivering invisible yet indispensable ecosystem services.
As rivers flow through midland regions, they become vital sources of domestic and industrial water. Expansive irrigation systems in the North Central, Eastern, and Southern provinces rely on these flows to power rice cultivation and food production. Midstream stretches also support fisheries, livestock grazing, and seasonal farming—key pillars of rural income diversification.
At the coastal interface, rivers feed estuaries and brackish lagoons, sustaining mangrove ecosystems and ocean-linked livelihoods. Their flow regulates salinity intrusion and mitigates coastal erosion—critical for the long-term resilience of coastal settlements and the growth of Sri Lanka’s blue economy.
Together, these rivers bind upstream energy, midstream agriculture, and downstream ecology into a single, interconnected system. Their integrated management is not merely an environmental imperative—it is a strategic necessity for economic stability, climate adaptation, and inclusive rural development.
Downstream problem
The downstream problems of the rivers are a common one: Upstream river users can significantly affect downstream communities and activities economically, environmentally, and socially, often without direct accountability. It usually happens due to the activities of the upstream users.
The activities performed by the upstream users can limit the consistent and clean water flows to the downstream users throughout the year. Agricultural runoffs due to agrochemical usage or the industrial effluents due to industrial activities in the upstream areas can cause water contamination for the downstream users affecting their lives and economic activities.
Poor land use patterns, haphazard constructions, encroachment activities and deforestation in upper catchment areas increase soil erosion leading to sedimentation downstream and in water reservoirs. These activities may cause erratic rain patterns, earth slips, flash floods and climate change as well as disruptions to economic activities including hydropower generation.
Accordingly, it is quite possible that the activities of the upstream users – individuals or businesses or government agencies – can harm the biological diversity and disrupt ecological balance, affecting the downstream users. The negative impact can be felt by the economic activities and livelihoods tied to mangroves, lagoons, and brackish water fisheries as well as at macro level by the whole nation.
Market-based solution
The question now is how to address this issue: Although laws and regulations can be implemented, such interventions cannot go too far due to the complexity of the problem.
The downstream problem is a result of activities performed collectively by the upstream users. Due to the accountability issue, it is extremely difficult to identify who had done what and how much. The same issue makes that the use of rules and regulations and their implementation would be a complex and costly affair.
Although the problem is clear, the world has so far been ignoring the issue and continuing with business as usual. Nevertheless, now the people who have faced with detrimental consequences of environmental issues globally have been responsive and finding solutions.
The global issues of environmental pollution, biodiversity losses and climate change have also been getting aggravated. Against this background, some countries have adopted innovative market-based instruments to handle the types of issues as in our opening story.
Price of ecosystems?
The newest market-based instruments are called Payments for Ecosystem Services (PES). Before everything else, we must understand the concept of “ecosystem services” which are the nature’s way of supporting life on earth, human well-being and human activities including economic progress.
We have taken the nature’s services for granted without any economic value attributed to them. The earth is filled with such services as pollination of crops, water purification, climate regulation, soil nutrient cycling, balancing carbon emission, and disease regulation – all are part of the ecosystem services.
Accordingly, we need rivers, forests, and other elements of topography and geography which form the sources of the planet’s ecosystems. If such ecosystem services are gradually getting destroyed by human activities, and if the established legal systems are not capable of protecting and promoting them, then the market has a solution.
Let’s take our unique case of rivers flowing from the hilly centre of the country towards the plains and the sea. Downstream users have a case for getting uncontaminated clean water consistently throughout the year, while the upstream dwellers have the ability to ensure it. Accordingly, there is space for exchange of ecosystem services between the two parties at a price, which is called the PES.
Costa Rica case study
Among many international case studies available today, the National PES scheme in Costa Rica launched in the 1990s is a widely cited success story in environmental economics. Its focus has been on forest conservation in critical watersheds.
The impact of this PES scheme in Costa Rica has been the conservation of forest area covering over 500,000 acres, resulting in improved water quality and reduced sedimentation benefitting the downstream users in particular, and the national economy in general.
How did Costa Rica manage to do so? The private owners of the forest area were prevented in undertaking any activities that affect negatively the ecosystem services on the one hand, but carried out such activities that would promote the ecosystem services in the forest areas.
The forest owners entered into long-term contracts with the government. The government paid for the forest owners by imposing a user fee for water and utilising donor funds, while carrying out a monitoring and evaluation process to ensure the long-term success of the project.
Similar case studies on the implementation of PES schemes could be found in African countries such as Kenya, Uganda, and Tanzania, in South American countries such as Mexico and Colombia in addition to Costa Rica, and in Asian countries such as Indonesia, Philippines, Vietnam and South Korea.
Some other Asian countries have shown emerging readiness for PES implementation: These countries include, Mongolia, Thailand, Laos, Malaysia, Myanmar, Cambodia, Kazakhstan, Brunei and Singapore.
Relevant for Sri Lanka?
Sri Lanka’s ecologically sensitive landscapes—ranging from watersheds and forests to coastal zones and human-wildlife interfaces—make PES highly relevant. As a market-based tool, PES aligns with national goals for green growth, climate adaptation, and inclusive development, especially amid fiscal constraints.
However, despite years of research, PES remains largely unimplemented. Establishing a functional PES market requires robust regulatory and institutional frameworks—currently absent in Sri Lanka. Moreover, weak governance poses a significant barrier, potentially undermining transparency, accountability, and long-term viability.
(The writer is Emeritus Professor at the University of Colombo and Executive Director of the Centre for Poverty Analysis (CEPA) and can be reached at sirimal@econ.cmb.ac.lk and follow on Twitter @SirimalAshoka).
Hitad.lk has you covered with quality used or brand new cars for sale that are budget friendly yet reliable! Now is the time to sell your old ride for something more attractive to today's modern automotive market demands. Browse through our selection of affordable options now on Hitad.lk before deciding on what will work best for you!