Questions raised over Sri Lanka's DPI strategy and trade reform sequencing

SRI Lanka's current approach to Digital Public Infrastructure (DPI) and trade liberalisation may reinforce inequality rather than reduce it unless access, mobility, and capability gaps are addressed upfront, UNDP Country Economist Dr. Vagisha Gunasekara has warned.

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Responding to a Centre for Poverty Analysis (CEPA) guest lecture on the World Bank's South Asia Development Update on Trade, Artificial Intelligence (AI) and Labour Markets in South Asia, Dr. Gunasekara said: "AI and trade can be very powerful tools for transformation in Sri Lanka, but only if we change who is in that digital queue before we open the gate wide."

She argued that Sri Lanka's digital foundations and labour mobility constraints highlight gaps in the country's readiness for the next phase of economic reforms.

She said the regional report outlines how jobs, Al, and trade shape South Asia's trajectory, but when applied to Sri Lanka "the gains will mostly accrue to those already positioned to access them."

More than a third of households remain offline and only 37% of adults use the internet. Digital literacy stands at 57%, computer literacy at 34%, and only one in five households owns a desktop or laptop. "Most Sri Lankans access the modern economy, if at all, through a very limited device," she said.

By 2021, 61% of households were online, largely via mobile data. The urbanrural gap in adult internet use is roughly 20 percentage points. Only 13% of South Asia's workforce is in export-linked jobs, and Sri Lanka reflects this pattern in apparel, IT, BPM, logistics, and tourism. "These are younger, better paid, more skilled jobs, but the pipeline into them is already narrow," she said.

Education and digital access during COVID-19 reinforced that divide.

During school closures, 63% of children accessed remote learning, while 15% received none. In households with internet, 90% of children accessed online education; in households without, only about twothirds did. Children from better-educated households were 20-30 percentage points more likely to receive online learning.

"These are the workers who will compete for Al-complementary jobs in a decade. The inequality is being pre-wired today," she said.