Local aluminium fabricators warn BOI policy gaps threaten local industry

• Say omissions BOI’s Negative List have enable fully fabricated aluminium doors, windows and façade systems to enter country without duties, even though such products are fully manufactured locally
• Assert BOI-approved developers gain cost advantages over local fabricators, while government revenue and foreign exchange are lost through imports of products already made in Sri Lanka
• Stress impact is felt most acutely by small and medium-sized enterprises, which government policy is meant to support

Sri Lanka’s aluminium door, window and façade fabrication industry is being undercut by policy gaps that allow finished products to be imported duty-free, threatening jobs, foreign exchange savings and domestic manufacturing capacity, an industry body said.

The Aluminium Fabricators Association of Sri Lanka (AFASL) said the omissions in the Board of Investment’s (BOI) Negative List have enabled fully fabricated aluminium doors, windows and façade systems to enter the country without duties, even though such products are fully manufactured locally.

The industry employs more than 30,000 people directly and indirectly and has operated since the 1980s, supported by five local aluminium extrusion manufacturers and a skilled workforce certified up to NVQ Level 4. Sri Lanka also has a well-established glass-processing sector, including toughened, laminated and double-glazed glass producers.

Under the current rules, aluminium extrusions are listed on the BOI Negative List but finished aluminium products are not. The list also does not specify the Harmonised System (HS) codes, allowing finished doors, windows and façade systems to be imported under varying descriptions and approved for duty-free entry, the AFASL said.

“This has created an uneven playing field,” the AFASL said, adding that the BOI-approved developers gain cost advantages over local fabricators, while the government revenue and foreign exchange are lost through imports of products already made in Sri Lanka.

The AFASL said the imported systems often include glass, hinges, locks and accessories that are also produced locally, cutting off demand for domestic suppliers across the value chain. The impact is felt most acutely by the small and medium-sized enterprises, which the government policy is meant to support.

Since May 2025, the AFASL has engaged the BOI, Finance Ministry and Industries Ministry, urging the authorities to include the HS codes on the BOI Negative List and to list aluminium doors, windows and curtain wall systems under HS Code 7610.

The AFASL welcomed support from the Industries Ministry, which has recommended adding fabricated aluminium doors and windows to an updated Negative List and said the senior officials have acknowledged the need to revise the framework. However, it warned that the proposed reductions in the cess levy could further encourage the imports at a time when the sector is still recovering from the economic crisis.

With most subsidies withdrawn across the economy, the AFASL said it was inequitable for the BOI-registered property developers to continue benefiting from the duty-free imports, while the locally made products remain heavily taxed for the broader population.

The AFASL urged the policymakers to align investment incentives with industrial policy, protect domestic manufacturing and ensure fair competition across the construction supply chain.