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Mega-scale development projects lagging behind, only 5 out of 79 completed: Report
View(s):Just five out of 79 mega-scale development projects that were due to have been completed by end-March have finished on schedule, the Project Management and Monitoring Department’s (PMMD) latest report states.
The “Mega-Scale Development Projects First Quarter 2025” has been released on the website of the PMMD, which falls under the Finance, Planning and Economic Development Ministry. The report examines the status of 205 projects as at end-March this year. Among them are 21 new projects initiated in 2025—six through foreign grants, five via foreign loans and 10 using local funds.
As with previous years, the report paints a bleak and costly picture of project execution in Sri Lanka. A total of 96 projects are classified with a red colour code or “critical status”, indicating significant delays in delivering expected outputs and benefits.
Foreign-funded projects experienced more delays compared to those financed locally. The primary causes include changes in project scope and the granting of time extensions.
For instance, foreign loan-backed projects showed a financial progress of only 26.53 percent by the end of the first quarter while it was 48.15 percent in foreign grant-funded projects. But projects backed by domestic funds achieved 71.93 percent financial progress (with those financed by local loans at 71.42 percent).
The full current project portfolio stands at an estimated Rs. 3.1trn with an additional Rs. 1.3trn required to complete the remaining work. With the exception of three projects, all others are scheduled to conclude by end-2028. Yet only 7.2 percent of this year’s budget allocation of Rs. 649bn was spent by end-March. This is a mere 38.9 percent of the first quarter target.
There was no delay in the Treasury releasing funds, the report states. However, actual expenditures were low owing to the non-submission of payment bills, largely caused by lags in project implementation. Unpaid bills of Rs. 32.6bn were reported as pending by March-end.
“Notably, allocations for projects in the transport, highways, ports, and civil aviation sectors show significant underutilisation,” the report points out. “This is primarily due to delays in the procurement process, poor contractor performance, changes in project scope or design, and delays in loan disbursements, despite the completion of debt restructuring by aid agencies.”
Time extensions granted to projects are often a leading cause of delays alongside changes in project scope, the report indicates. A massive 67 projects were granted extensions—eight of them over five years and two of them more than 10—while 19 projects were running over time even without formal extensions.
“Such prolonged extensions not only lead to increases in the total estimated cost but also allow for repeated modifications to the project scope,” the report observes. “As a result, the timely delivery of public benefits is hindered, ultimately compromising the overall cost-effectiveness and intended impact of the projects.”
The Ministry of Transport, Highways, Ports and Civil Aviation is identified as lagging notably in project execution, with many of its projects classified as “critical” (red code). These include the Central Expressway Project Section 3, Port Access Elevated Highway and the East Container Terminal (ECT) Civil Works Phase. Several other require “special attention” (amber code) or are facing delays.
The Urban Development, Construction and Housing Ministry has 60 projects that are still in progress and coded red. They include the numerous water supply schemes across different regions—Ambatale, Gampaha, Kandy North, Pathadumbara, Laggala New Town, various projects in Batticaloa, Ampara, Matara, etc.)—and urban regeneration programmes like the Metro Colombo Solid Waste Management Project.
Unfinished initiatives under the Health and Mass Media Ministry include the Health & Medical Services Improvement Project, construction of the National Stroke Centre, construction of the Heart Centre at Lady Ridgeway Hospital and construction of the Cancer Hospital Stage 2 at National Hospital, Kandy.
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