Dr Sarath Obeysekera

Japan’s decision to provide approximately US$3 billion (¥480 billion) in long-term support for the ACME Group–IHI Corporation Green Ammonia Project in Odisha is a significant milestone, not only for India but for the entire Asian region. It demonstrates how governments can work with the private sector to accelerate investment in emerging industries that will shape the future global economy.

The project, which will export 228,000 tonnes of green ammonia annually to Japan from 2030 onwards, enjoys a unique advantage. Through Japan’s Contract for Difference (CfD) mechanism, the project receives 25 years of price support, providing investors with demand certainty and financial stability. Such policy backing transforms ambitious concepts into bankable projects.
For many years, I have advocated that Sri Lanka should diversify beyond conventional industries and embrace Blue Economy-based industrial development. Our strategic location in the Indian Ocean, together with excellent deep-water harbours, abundant renewable energy resources, and favourable shipping routes, provides Sri Lanka with a unique opportunity to become a regional producer and exporter of green hydrogen and green ammonia.

It is therefore encouraging that the newly restructured Board of Investment is now inviting proposals from investors to establish green hydrogen and ammonia production facilities in Trincomalee. This initiative deserves wholehearted support. Trincomalee possesses many of the natural advantages required for such projects, including its world-class natural harbour, available industrial land, access to renewable energy potential, and proximity to international shipping lanes.

However, identifying opportunities is only the first step. The real challenge lies in implementation.
Sri Lanka has often been successful in producing excellent master plans, feasibility studies and investment strategies. Unfortunately, many projects become trapped in lengthy approval processes, overlapping institutional responsibilities, procurement complexities and prolonged tender procedures. Investors seeking to commit hundreds of millions of dollars cannot afford years of administrative delays while competing countries move ahead.
India itself is not immune to bureaucratic procedures. Nevertheless, when strategic national industries are identified, both the Central Government and State Governments have increasingly adopted mechanisms that facilitate rapid project implementation while maintaining transparency and accountability. Financial incentives, policy certainty and institutional coordination have enabled India to emerge as one of the world’s leading destinations for renewable energy investment

Sri Lanka can draw important lessons from this experience.

Strategic industries such as green hydrogen, green ammonia, offshore renewable energy, marine industries and other Blue Economy sectors require a dedicated investment framework that enables faster approvals without compromising governance. Legislation should empower designated institutions to coordinate approvals through a genuine one-stop mechanism, supported by defined timelines and streamlined procurement procedures for strategic investments.
Such reforms are not intended to weaken transparency. On the contrary, they would strengthen investor confidence by replacing uncertainty with predictable, rules-based processes.

The global race towards carbon neutrality has already begun. Countries across Asia, the Middle East and Australia are positioning themselves to become exporters of green fuels to energy-importing nations such as Japan, South Korea and Europe. The window of opportunity will not remain open indefinitely.

Sri Lanka possesses many of the ingredients needed to participate in this emerging industry. What has often been lacking is the speed of execution.

The Government’s decision to invite proposals for green hydrogen development in Trincomalee is therefore a welcome beginning. It should now be supported by legislative reforms, institutional coordination and fast-track implementation mechanisms that allow projects to commence without unnecessary delay.

If Sri Lanka acts decisively today, Trincomalee could evolve into one of the Indian Ocean’s leading hubs for green hydrogen, green ammonia and other Blue Economy industries, creating high-value employment, increasing exports, attracting foreign direct investment and strengthening the country’s long-term energy and economic security.

Japan’s support for India’s green ammonia industry demonstrates what is possible when governments provide policy certainty and investors respond with confidence. Sri Lanka should seize this moment and ensure that promising opportunities do not remain only on paper but become successful industries contributing to national prosperity.

Regards

Dr Sarath Obeysekera