Car Imports Drive Sri Lanka’s Trade Gap to $717.5M in April
Sri Lanka’s trade deficit expanded to USD 717.5 million in April 2025, marking a significant year-on-year increase from USD 557.7 million recorded in April 2024, according to the latest data released by the Central Bank of Sri Lanka.
The widening gap is primarily attributed to a sharp rise in import expenditure, which outpaced the growth in export earnings. Merchandise exports saw a 10.4% increase during the month; however, imports surged by 17.5%, exerting pressure on the overall trade balance.
One of the most notable contributors to the rising import bill was motor vehicle imports, which climbed to USD 134 million in April. The Central Bank report highlighted this sharp uptick as a key factor behind the increased trade deficit.
The data suggests a revival in consumer demand and easing of import restrictions, particularly in the automobile sector. However, the growing trade imbalance could pose challenges for Sri Lanka’s external sector stability, particularly in managing foreign exchange reserves and maintaining currency stability.
