Sri Lanka approves cannabis cultivation by foreign investors

Seven foreign investors selected from 37 applicants  

Each investor must deposit USD 2Mn bond with CBSL 

Minimum USD 5Mn investment required 

64 acres of BoI land in Mirigama allocated for the project  

Cultivation restricted for pharmaceutical production and testing    

By Indika Sri Aravinda  

The government has granted permission to seven foreign investors to legally cultivate cannabis in Sri Lanka for the first time, under strict conditions, former Commissioner General of the Ayurveda Department Dr. Dhammika Abeygunawardena said.  

The approval has been granted as a project under the Board of Investment (BoI) of Sri Lanka.  

These seven foreign investors were selected from 37 applicants for the cannabis cultivation project, and the BoI has provided them with legal clearance.  

In the first phase, each investor has been issued a temporary licence for six months, with the government planning to extend the cultivation period based on progress reports.  

As a condition, each investor must deposit a bond of USD 2 million with the Central Bank of Sri Lanka as a guarantee. Dr. Abeygunawardena, who is acting as the supervising officer for the project, added that the minimum investment required to start a cannabis cultivation venture is USD 5 million.  

All cannabis cultivated in Sri Lanka must be exported, and the government must be assured that it will be used solely for pharmaceutical production and testing purposes.  

The BoI continues to monitor all approved projects. For this initiative, 64 acres of land under the BoI have already been allocated in the Mirigama area.  

Under existing Sri Lankan law,  strict regulations have been imposed to ensure that no part of the cannabis plant, including seeds, leaves, or roots, is released into the external environment during cultivation.  

Additionally, the cultivation site must be enclosed by a secure fence, and investors must arrange for Special Task Force (STF) and police protection for the premises, Dr. Abeygunawardena emphasised.  

All cannabis must be exported and cannot be used within the country.  

The BoI, the Ministry of Public Security and Parliamentary Affairs, the Ministry of Environment and the Department of Ayurveda are jointly responsible for overseeing the project.  

Dr. Abeygunawardena further stated that the government expects the initiative to generate substantial foreign exchange earnings.  

Former State Minister Diana Gamage played a key role in establishing the legal framework for cannabis cultivation in Sri Lanka.