400 Acres

Land Extent

USD 5 Mn

MINIMUM Investment

Project Overview

The BOI, in order to support developing new industry verticals via import substitution and exports, is establishing a state-of-the-art pharmaceutical zone in Arabokka, Hambantota. This dedicated Pharmaceutical Manufacturing Zone plans to meet 40% of the domestic demand for pharmaceutical products by locally manufactured drugs while creating a pathway to export earnings as import substitution by 2025. The Zone will be declared as a “Strategic Development Project” (SDP) and strategic pharmaceutical investments established within the proposed zone will be eligible for benefits under the SDP Act. This State–of–Art zone will be designed to International standards and accreditations. This specifically tailored zone will make a conducive and liveable business environment to globally renewed pharmaceutical brands to bring the latest technological advances to manufacture pharmaceutical products.

      • Pre-approved zone: All environmental clearances to manufacture a full suite of pharmaceutical products and fast tracked NMRA approvals.


      • Strategic location: Proximity to both the Hambantota port and Mattala airport, with dedicated facilities at airport to facilitate sea-air logistics.


      • Common facilities provided: Wastewater treatment & sea outfall and common logistics facilities


    Project/ownership structure

    Foreign Direct Investments (FDI), Domestic Private Investment

Project incentives:

5-10-year tax holiday for exports (Duration of tax breaks based on size of investment, type of product to be manufactured, market orientation, type of patent rights, domestic value addition, manufacturing quality etc.)
0% duty & taxes on imported capital goods & raw materials

Exemptions for Import Substitution under Value Added Tax (VAT), Port & Airport Levy (PAL), Customs Import Duty (CID), Commodity Export Subsidy Scheme (CESS)

Other incentives:

Dividends to non-resident entities are exempt from income and withholding taxes
Sri Lanka enjoys double-tax treaties with 46 nations
100% repatriation of capital and profits permitted
Access to talented human capital with a 92% literacy rate that is 30% lower in cost vs region

Strategic location

Proximity to both the Hambantota port and Mattala airport, with dedicated facilities at airport to facilitate sea-air logistics.

State-of-the-art zone

This pharmaceutical zone in Arabokka, Hambantota will provide common facilities including wastewater treatment, a sea outfall and common logistics facilities.

Approved activities

  1. Pharmaceuticals, medicinal chemical, and botanical products manufacturing facilities
    • Production of medicines covering all therapeutic classes
      • Production of APIs
      • Secondary processing including intermediates,  formulation, blending and packaging
      • Production of radiopharmaceuticals (I-131, Tc-99m, F-18)
      • Manufacturing of herbal/botanical products and indigenous medicine including Ayurvedic and homeopathic drugs
    • Production of borderline products (products with combined characteristics of medicines along with foods, medical devices)

  2. Medical devices manufacturing or assembling facilities

  3. Related ancillary facilities R&D including biotechnology research and production and laboratory testing facilities