Sri Lanka’s power sector struggled to meet the growing demand for electricity at acceptable reliability and sufficiently low cost during the decade leading to this project’s appraisal in 2010. The transmission system was weak and substantial investments were needed to strengthen the network and improve its reliability.
While Sri Lanka’s road density, at project appraisal in 2005, was higher than that of many developing countries, because of poor quality and condition, its road network was incapable of meeting the rapidly growing freight and passenger traffic.
For nearly 3 decades, Sri Lanka had been severely affected by an internal armed conflict. The entire country suffered but the Northern Province bore the brunt of the conflict. The conflict intensified from February 2007 and government forces gained full control in May 2009.