Duty-free imports put Sri Lanka’s aluminium fabricators at risk as BOI policy gaps widen

On building sites across Sri Lanka, aluminium doors, windows and façade systems have long been a familiar feature, supplied largely by local fabricators who built their businesses alongside the country’s construction industry. Today, those same fabricators say they are being edged out of the market, not by cheaper raw materials or weaker demand, but by policy gaps that allow finished aluminium products to be imported duty-free.

The Aluminium Fabricators Association of Sri Lanka (AFASL) says omissions in the Board of Investment’s (BOI) Negative List have created an uneven competitive landscape. Fully fabricated aluminium doors, windows and façade systems are entering the country without duties, even though they are manufactured locally, giving BOI-approved developers a clear cost advantage over domestic suppliers.

The industry employs more than 30,000 people directly and indirectly and has been operating since the 1980s. It is supported by five local aluminium extrusion manufacturers, a skilled workforce certified up to NVQ Level 4, and a well-established glass-processing sector producing toughened, laminated and double-glazed glass. Despite this capacity, the current rules restrict aluminium extrusions but leave finished aluminium products outside the Negative List.

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According to the AFASL, the problem is exacerbated by the absence of Harmonised System (HS) codes in the BOI framework. This allows finished doors, windows and façade systems to be imported under varying descriptions and approved for duty-free entry. “This has created an uneven playing field,” the association said, adding that government revenue and foreign exchange are being lost on imports of products already made in Sri Lanka.

The impact is not limited to fabricators alone. Imported systems often arrive with glass, hinges, locks and accessories that are also produced locally, cutting demand across the domestic supply chain. Small and medium-sized enterprises are feeling the pressure most sharply, even though government policy is intended to support them.

Since May 2025, the AFASL has engaged with the BOI, the Finance Ministry and the Industries Ministry, calling for HS codes to be clearly specified on the Negative List and for aluminium doors, windows and curtain wall systems to be listed under HS Code 7610.

However, it warned that proposed reductions in the cess levy could further encourage 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 is inequitable for BOI-registered property developers to continue benefiting from duty-free imports while locally made products remain heavily taxed for the broader population. The association urged policymakers to better align investment incentives with industrial policy, protect domestic manufacturing and ensure fair competition across the construction supply chain.

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