Sri Lanka Leaping from infancy to an organized industrial sector

Posted by Asitha G Punchihewa on June 20, 2018 at 12:25 AM

By Asitha G Punchihewa

Decades of investments in developing human capital seem to pay back as Sri Lanka is truly transforming from infancy to full blown industrialization. Being traditionally an agricultural population engaged predominantly in paddy cultivation contributing to staple diet of the Sri Lankans, it also has a vibrant service sector signified with a well-developed energy outreach, clean water supply, drainage, banking and finance, communications, on shore and off shore transport sub sectors and a quaternary sector with media, marketing and advertising industries employing modernity.

Over 1.7 million Sri Lankans continue to be employed off shore hence keeping the unemployment rate at 4.6%. Hundreds of thousands representing youth population of Sri Lanka are employed at different operational tiers in the industrial sector in offshore destinations mainly in the South East Asian countries such as South Korea and Singapore. However, a bulk of the human resource pool that can be mobilized to promote an organized industrial sector in Sri Lanka is available in the Middle Eastern countries. The said segment of the employable population in the Middle East who undergo torturous and exploitative work conditions and situations can contribute to the national economy in a greater dimension if adequate measures are taken to provide them with quality livelihood avenues.

For a developing country that is struggling to sustain its export earnings, playing its cards with precision mean a lot. Government has shown intent to mobilize the migrant workers to return for gainful employment at the Export Processing Zones located island-wide. The returnee migrant workers and youth will cater to diverse human resource needs required by investors who are lining up to set up production lines. Government has taken measures to incentivize and encourage less educated youth, mostly male to engage in the industrial sector by detaching them from the easy option of remaining as taxi drivers that contribute to urban road traffic congestion.

The export oriented garment industry that has been in Sri Lanka’s industrial landscape for a considerable period already accounts for nearly 40% of the foreign exchange earnings of Sri Lanka. Already, tire manufacturers are in, so are other manufacturers who use rubber as a raw material as Sri Lanka has a decent supply of natural latex. Manufacture of electrical and electronic devices has taken place for well over two decades in industrial zones. Diversification of the industrial sector to accommodate value added knowledge based products is well on card with high literacy rates and relatively higher unemployment and underemployment rates among educated youth.

There was a void to be filled despite their theoretical knowhow was in par with the standards prescribed for the industrial sector to flourish. Due to this, Sri Lanka lost a sizable youth population with technical skills as they migrated in search for greener pastures mainly in the industrialized West including EU countries, USA, Canada, Australia and New Zealand.

With a view to retain quality human resources, a long term plan was devised. The first wave of action included training of academics through encouraging them to engage in offshore postgraduate and Phd programmes in rare specialties such as process lifecycle management which includes niche sectors such as ergonomics, energy conservation and modern human resource management techniques. Tertiary educational institutions are now being modernized with machinery that would enable students to get equipped to face realities that the industries offer with fluency.

Already, mechanical design, electronic design automation, software delivery, simulation & test, manufacturing planning, factory automation, manufacturing operations, performance analysis, collaboration for lifecycle management and connectivity have been introduced to undergraduate and post graduate engineering courses. Extending such modules to other technical colleges is being planned so that the next generation of skilled youth will be technically savvy. Furthermore, process automation will also lead to less hands being needed to run an industry, which will lead to offering opportunities for other industries to attract trained hands for scaled production.

Energy is something that accounts for a sizable portion of the costing of an industry. Being a tropical country, energy on heating is not applicable at all, but using appropriate ventilation and conserving energy on maintaining workable environments is another specialty that has evolved over the years in the global sphere. Energy auditing, maintaining eco standards are used to reduce overhead costs as well as to promote product branding by industries. There are already a few large manufacturers who have invested in green energy production such as mini hydro power plants, wind mills and solar energy harvesting which in return have enabled industries to move towards being carbon neutral. The government too has provided incentives to promote green energy such as solar harvesting on a large scale and at domestic level.

Worker wellbeing is an area that is hard to find in the developing world. Giving a fair deal for factory workers has grown to an extent where organized consumer groups have shown a tendency to demand from producers to maintain decent work conditions and wages for factory workers. Meanwhile in Sri Lanka, manufacturing line managements have realized on how investing in wellbeing of workers would pay dividends via better work output, lowered absenteeism, higher staff retention and how such interventions could be used for brand promotion through consumer groups. Since this is an area that talks about diverse aspects of worker wellbeing such as physical, psychological, economic, socio- environmental, cultural and spiritual wellbeing, specialized institutions have evolved to provide panacea solutions to the industrial sector to blend worker wellbeing into their operational models. Already, the biggest manufacturers in Sri Lanka have become convinced about the idea and have started doing investments and are enjoying its benefits together with a happier and healthier workforce.

Such specialized knowledge areas essential for an industrial sector to perform at the global scale are not alien to Sri Lanka’s industrial landscape any more. State of the art technologies are already being used in abundance by large scale manufacturers to streamline and optimize productivity and slowly gaining ground even among the smaller scale industries due to distinct advantages and speedier return on investment.

Therefore, Sri Lanka seem to have played its cards right to set a launching pad for the organized large scale industrial sector to account to a larger portion of the economic contribution and export earnings while providing a solution to unemployment and underemployment.


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