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The study aims to provide current state of sustainable freight transport in Sri Lanka and encourages the Government of Sri Lanka and other relevant stakeholders to make freight transportation planning, policy, and investment decisions based on the three dimensions, or pillars, of sustainable development: the environmental, economic, and social dimensions (also known in economics as the triple bottom-line). It uses an understanding of the three dimensions and their interlinkages as elaborated by the United Nations Conference on Trade and Development and the 2030 Agenda for Sustainable Development, including Sustainable Development Goals (SDGs). Comprehensive research was conducted to inform the content of this study, consulting a wide variety of government, United Nations, and other available material.

The study aims to help guide the integration of sustainable freight transportation planning efforts—vertically among levels of government and horizontally across modes—with a balanced development of modes. It also aims to support institutional, legal, and regulatory frameworks that promote effective and sustainable freight transportation; to build capacity among transportation planners; and to promote diversified funding sources and transformative transportation technologies.

There is a special emphasis on emissions reduction, including greenhouse gas (GHG) emissions (primarily CO2 in this context). With over 20 per cent of global CO2 emissions being derived from transportation and 40-50 per cent of that percentage coming from the transportation of freight, it is important to target the sector in the fight against climate change.

This is particularly relevant to Sri Lanka as the country’s total freight transportation in ton-km continues to rise amid an outdated trucking fleet, a lack of economies of scale, poor road conditions and congestion, limited modal share, and a dependence on imported fuel. All these factors contribute to emissions, negative externalities, and economic losses that can otherwise be avoided in a world where Sri Lanka stands as one of the most vulnerable countries to GHG-induced climate change.

As the preeminent port in South Asia, the Port of Colombo, figures prominently in the revenue generation, economy, and future of Sri Lanka. Rising to meet the challenges that come with the ever-growing number of port calls is thus important. Simplified customs formalities are central to the international transport of goods and their role in freight transportation has been underlined.

The study is divided into Sections 1-5 that feed into Section 6, where the challenges to sustainable freight transportation in Sri Lanka are articulated. Section 1 provides a background where the rationale behind this study is briefly summarized, while an economic outlook and energy overview provide some context behind two these import elements to freight transportation. Sustainable freight transportation is an important component of better trade efficiency and logistical performance and is thus important for Sri Lanka’s continued development as limited economic complexity and stagnating exports necessitate changes in these areas.

Section 2 then provides a comprehensive overview of sustainable freight transportation in Sri Lanka by exploring where it is at today, the issues at hand, and the gaps between the current situation and aspirational sustainable future. This overview is primarily presented through the lens of two frameworks: the SDGs and the avoid-shift-improve framework. Some SDGs identified as relevant to sustainable freight transportation include SDGs 3.6 (road traffic accidents), 3.9 (air pollution), 7.3 (energy efficiency), 9.1 (infrastructure), 11.2 (accessible and sustainable transportation systems), 11.6 (air quality), 12.c (fossil-fuel subsidies), 13.1 (climate change adaptation and resilience), and 13.2 (climate change policies, strategies, and planning).

Upon review of these SDGs, some identified bright spots are Sri Lanka’s relatively good air quality, a high density of roads and rail lines, the continued development of its nascent expressway network, a drop in the transportation sector’s emission intensity, high container throughput at the port of Colombo, and a strong recognition of the issues at hand. However, noted issues are equally abundant. They include—among others—rising CO2 emissions from the transportation sector, a badly outdated railway system, congestion in the Colombo metropolitan region, and unsafe driving conditions stemming from deficiencies in enforcement and road conditions.

Following this, Section 3 links Sri Lanka’s policies, plans, visions, strategies, and international commitments to sustainable freight transportation. A full list can be found in Sections 3.A and 3.B. For more details on the portions that are relevant to freight transportation in one way or another, see Appendix 10.

Section 4, meanwhile, supplements this study. Section 4.A elaborates more on the key pillars of sustainable freight transportation or, in other words, the three dimensions of sustainable development as they relate to freight through a wide range of considerations. Next, Section 4.C provides a list of prospective performance indicators that can be used to measure progress towards sustainable freight transportation, organized under both the MoI and key pillars.

Section 5 then provides a brief, yet concise, overview of the impacts of COVID-19 on Sri Lanka. Like most countries, the economy of Sri Lanka had taken a hard hit. Global disruptions to the supply chain, lockdowns, and travel restrictions have all had the effect of hurting key industries in Sri Lanka. Tourism has decreased and exports have fallen. The year 2020 also saw negative growth in container throughput at the Port of Colombo, against trends where numbers doubled in the last decade. This has all had a negative impact on the economy and revenue of Sri Lanka. However, the pandemic has also had the positive effect of accelerating paperless customs processes that had already existed in some form or another prior to the pandemic.

Coming together, Section 6 articulates the main challenges to sustainable freight transportation in Sri Lanka. These have been identified as: Costs, Access to Finance, Systems Upgrades (e.g., Intermodal Networks, Railways, Rural Roads, and the Port of Colombo), E-commerce, Technology Platforms, Replacing the Aging Rigid Trucking Fleet, Scrapping Older Vehicles, Operator Resistance, Customs, and Enforcement and Driver Attitudes.