In this video by Advocata Institute, Chantal Dassanayakea, a research intern, delves into the lengthy construction permit process in Sri Lanka and its impact on business growth. Sri Lanka is ranked poorly in various indicators of the business environment, such as the global competitiveness index and the ease of doing business index. To address these issues, Advocata Institute proposes an approach that focuses on continuous improvements in the construction permit process by targeting specific procedures. By adopting a more agile perspective and utilizing digital solutions, the time required for obtaining construction permits can be significantly reduced, leading to tangible progress and a more business-friendly environment.
Obtaining a construction permit in Sri Lanka involves multiple steps and options, depending on the size of the building. Larger projects obtain permits through the Urban Development Authority (UDA), which has an online system for streamlined processing. However, smaller constructions require permits from municipalities or Pradeshya Sabas, which still rely on a paper-based system. This lack of digitization and initial plan flagging can lead to potential delays and errors. Advocata Institute suggests adopting the UDA’s system for smaller constructions to simplify the process and enable businesses like Ruan, a banana businessman, to efficiently obtain construction permits. By improving the construction permit process, Sri Lanka can create a more attractive environment for investment and growth, ultimately supporting the country’s economic development.
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Issues with Sri Lanka’s current construction permit process
Poor rankings on business environment indices
Sri Lanka consistently ranks poorly on various business environment indices. The Global Competitiveness Index, Ease of Doing Business Index, Fraser Institute’s Economic Freedom, and other rankings all indicate that Sri Lanka’s business environment needs improvement. These rankings highlight the need for Sri Lanka to prioritize enhancing its business climate in order to attract more foreign investments.
Need for improvement in business environment
Recognizing the urgent need for improvement, Sri Lanka must take a proactive approach to addressing the shortcomings in its business environment. Rather than waiting for a perfect solution, the focus should be on continuous marginal improvements. By targeting specific procedures that can be changed, the time required for obtaining construction permits can be effectively reduced, leading to tangible progress.
Focus on specific procedures for improvement
To bring about improvements in the business environment, it is necessary to concentrate on specific procedures that contribute to delays and inefficiencies. By addressing areas such as the number of procedures required to obtain a permit, the number of days it takes to complete the process, the cost of construction, and building quality control, Sri Lanka can make significant strides in streamlining the construction permit process.
Agile approach to reduce time required
An agile approach is crucial in adapting to emerging needs and creating a more efficient and business-friendly environment. By implementing small-scale improvements and continuously refining the process, Sri Lanka can gradually enhance the status quo. This approach ensures flexibility and allows for adjustments as needed, resulting in a construction permit process that is faster and more responsive to business needs.
Current process for obtaining construction permits in Sri Lanka
Different processes for small and large constructions
The process for obtaining construction permits in Sri Lanka differs based on the size of the construction project. Larger buildings, covering mega projects over 9,000 square feet, require permits from the Urban Development Authority (UDA). On the other hand, smaller constructions fall under the purview of municipalities or Pradeshya Sabas, which use a paper-based system.
Paper-based system for smaller constructions
For smaller constructions, the current process relies on a paper-based system. This system can lead to potential delays and back-and-forth interactions. Since there is no initial flagging, plans can be rejected by development divisions if there are any errors, requiring corrections and resubmission.
Potential delays and back-and-forth interactions
The current construction permit process in Sri Lanka can be time-consuming and involve multiple interactions with different authorities. For example, if someone wants to build a small shed, they must first consult a certified surveyor to survey the land and provide a survey map. This process alone can take several weeks. Then, they must work with an architect to draw the plan and receive certifications from relevant authorities such as the electricity board, water supply, drainage board, fire department, and the central environment authority.
Example of the process for a small shed construction
To illustrate the complexities of the current process, let’s consider the case of Ruan, a banana businessman in Kuru Nagala. If Ruan wants to build a small shed to store his stock before sending it for sale, he must go through a series of steps. This includes engaging with a certified surveyor to survey his land, working with an architect to draw the shed’s plan, obtaining clearances from various agencies, and filing the plan with the municipal council. Any mistakes or contingencies can result in plan rejection, requiring amendments and resubmission. Ultimately, the entire process can take up to six months, hindering Ruan’s economic activities.
Proposed solution: Adaptation of UDA’s online system
Benefits of adopting UDA’s online system
The Urban Development Authority’s (UDA) online system for construction permit processing offers numerous benefits. By adopting this system for smaller constructions handled by municipalities or Pradeshya Sabas, Sri Lanka can streamline and expedite the process. With an online system, the time, cost, and overall efficiency of obtaining construction permits can be significantly improved.
Time, cost, and process efficiency
By moving towards an online system, Sri Lanka can reduce the time required to obtain construction permits. The cumbersome steps and back-and-forth interactions can be minimized, leading to a more efficient and streamlined process. Additionally, the cost of obtaining permits can be lowered, as online systems often eliminate the need for extensive paperwork, physical visits to multiple agencies, and unnecessary delays.
Allowing businesses to operate online
Adopting UDA’s online system for construction permits enables businesses to operate online. This shift from a paper-based system to a digital platform not only saves time and reduces administrative burdens but also aligns with the current trend of digitalization in many sectors. It allows businesses to conveniently submit plans, obtain clearances, and manage the permit process efficiently from anywhere, eliminating the need for physical visits and reducing paperwork.
Improving ease of doing business environment
Implementing an online system for construction permits is a significant step towards improving Sri Lanka’s ease of doing business environment. It demonstrates the government’s commitment to digital transformation and streamlining bureaucratic processes. By embracing digital solutions and making the construction permit process more efficient, Sri Lanka can create a more attractive and business-friendly environment, encouraging both local and foreign investments.
Importance of improving Sri Lanka’s business environment
Demands for attention and proactive efforts
Sri Lanka’s business environment demands attention and proactive efforts to enhance competitiveness and attract investments. Various indicators consistently rank Sri Lanka poorly, reflecting the need for improvement in several areas. To foster economic growth and create a favorable investment climate, it is essential to prioritize improvements in the business environment.
Focusing on microsystems and continuous improvements
An effective approach to improving the business environment involves focusing on microsystems and implementing continuous improvements. Instead of waiting for a perfect solution, Sri Lanka can bring about tangible progress by targeting specific procedures that contribute to delays and inefficiencies. Small-scale improvements can lead to significant positive changes and gradually enhance the overall business environment.
Targeting construction permits as a low-hanging fruit
One area to target for improvement is the construction permit process. By addressing the challenges associated with obtaining construction permits, Sri Lanka can achieve relatively quick wins. Streamlining and expediting the construction permit process would not only benefit the construction industry but also have positive ripple effects on the overall business environment.
Harnessing digital solutions for revitalization
Digital solutions play a vital role in revitalizing Sri Lanka’s business environment. Embracing digitalization in permit processing can significantly enhance efficiency, reduce bureaucracy, and improve ease of doing business. By incorporating digital tools and platforms, Sri Lanka can better adapt to the needs of businesses and pave the way for a more vibrant and dynamic business ecosystem.
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Call to action for reform and positive change
Need for collective effort
Reforming Sri Lanka’s construction permit process and improving the overall business environment requires a collective effort. The government, private sector, and relevant stakeholders must come together to drive positive change. By collaborating and exchanging ideas, experiences, and best practices, Sri Lanka can create a conducive environment for business growth and investment.
Transforming Sri Lanka into an attractive investment destination
Reforming the construction permit process is a crucial step towards transforming Sri Lanka into an attractive investment destination. By simplifying procedures, reducing bureaucracy, and embracing digital solutions, Sri Lanka can showcase its commitment to providing a business-friendly environment. Creating a favorable investment climate will not only attract more foreign investment but also foster local entrepreneurship and economic growth.
Opportunity for positive change
The need for construction permit process reform presents an opportunity for positive change in Sri Lanka’s business environment. By seizing this opportunity, Sri Lanka can showcase its potential and commitment to economic development. Through reform and continuous improvements, Sri Lanka can create an environment that encourages business growth, innovation, and investment.
Information on reforms and how to be part of the change
For more information on the proposed reforms and how individuals and businesses can be part of the change, visit the Advocata Institute’s website at www.advocata.org. Stay updated on the latest content, events, and initiatives by subscribing to the Advocata Institute’s YouTube channel and following them on social media platforms. By staying informed and actively participating in the reform process, individuals can contribute to the positive change Sri Lanka needs.
The current construction permit process in Sri Lanka poses significant challenges for businesses. The poor rankings on various business environment indices highlight the need for improvement. By adapting the Urban Development Authority’s online system for smaller constructions, Sri Lanka can streamline and expedite the process, ultimately improving the ease of doing business environment. It is crucial to take a proactive and agile approach, focusing on specific procedures, and continuously making marginal improvements. By doing so, Sri Lanka can transform its business environment, attract investments, and drive economic growth. The time for reform is now, and collective efforts are needed to embrace this opportunity for positive change.
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