Sri Lanka to transform land registration, traffic and market access with MCC grant

ECONOMYNEXT – Sri Lanka is planning to deploy technology to cut through traffic congestion, connect rural farmers to markets abroad and transform a land registration to eliminate deed fraud replacing a archaic system started during British rule.

Sri Lanka is using grant funding from the Millennium Challenge Corporation to make the reforms. Changes to the land registry laws will also strengthen the rights of female spouses, officials said.

The projects were submitted to the MCC by Sri Lanka based on its own priorities through a concept  note in 2017 and formal proposal in November.

The agency accepted the projects after ensuring that they were areas MCC could support after assessing economic returns economy return, MCC officials said.

The five-year, 480 million US dollar compact with the government of Sri Lanka is divided among two broad categories; transport and land which was identified by Sri Lanka itself as key constraints to progress.

Transport Revolution

From the 480 million dollar grant 350 million US dollars has been invested for the transport sector.

Out of which 160 million US dollars has been allocated for an Advanced Traffic Management System (ATMS) for the Colombo metropolitan region, 50 million US dollars for bus transport service modernization.

Another 140 million for a central ring road, Central, Sabaragamuwa, Uva and Eastern provinces with the port and markets in the Western provinces helping Sri Lanka’s farmers to bring produce to population centres and export markets.

Two core transport problems had been identified by a project study; congestion in the Western Province and slow inter-regional movement of goods and people.





A rising population, urbanization and attractiveness of private transport as opposed to public transport are among factors contributing to the problem.

A study by Sri Lanka’s Moratuwa University showed that traffic congestion in the Western Province alone has opportunity costs of approximately 1.8 trillion rupees (2.4 billion US dollars) per annum.

“We are trying to reduce this by introducing this advanced, sophisticated traffic management system combined with the private sector and public sector busses,” National Coordinator, MCC Project Sri Lanka R. Siriwardhane said.

Real Time Watch

Siriwardhane also said that a 24 hour system traffic monitoring and controlling system will be set up.

At the moment in buses, the total fares collected do not go to the owners.

This activity will introduce modern technology for vehicle detection, real-time collection and analysis of traffic flows, an inter-connected traffic signal system and a bus priority system to improve public transport.

Real-time GPS tracking of buses will also be introduced which will enable transit operators to track the location of the buses.

A dangerous trend of buses racing each other in competition to collect more passengers to will be addressed by this system.

Consolidated scheduling for buses will also be implemented with any breach of rules is followed by a penalty.

Automated Cards

MCC looks to introduce an automated fare card collection system, based on smart cards which will reduce the possibility of committing frauds in collecting fares.

Reducing revenue leakages will help the owners get all the money collected from passengers and help keep fares down in the future.

“Owners of private sector buses sometimes has no control over the procedure. He does not receive the total income earned by a bus for the day," Siriwardhane said.

"These issues arise because there is no proper payment system and administering."

“To counter this situation we will introduce a verified payment system where the money will go directly to the owner’s bank account, which will minimize frauds done by bus employees.”

While in total 210 million dollars will be spent on improving transport conditions in the Colombo Metropolitan region,

MCC also focuses on rural transport, for which 140 million US dollars is allocated.

The Central Ring Road improvement activities will upgrade approximately 131 kilometers of interprovincial road network which connects the Central, Sabaragamuwa and Uva provinces with ports and markets in the Western province.

Digital Land

The MCC land project addresses the second major growth inhibitor of Sri Lanka; poor land administration using 67 million US dollars.

Currently Sri Lanka does not possess a proper national land inventory, not even on state lands.

This situation makes land administering that much more difficult and arduous.

Under the MCC project 23 million US dollars has been allocated to create a parcel fabric map (a basic geographically based cadastral map of land parcels) and complete inventory of state lands.

Data thus provided will be entered into the government’s e-State Lands Information Management System.

The map will identify location of state land with survey boundaries starting in seven districts in the North Western, North Central, Central and Eastern provinces.

The government is enabled to incorporate these data into their ongoing database project for state lands known as eSLIMS.

No Forged Deeds

Sri Lanka follows the deed system when registering land, which is an ancient system open for possibility of corruption and forgery.

The project will use 19 million US dollars for the conversion of properties from deeds to modern titles.

"New land registration program is based on the principle of title registration," Palitha Udayakantha, recently retired Land Surveyor General says.

"Instead of registering a transaction (in the deed registration system) the land and the ownership to land is registered in a Title Registration System.”

“A title carries a government guarantee on the ownership. Once a title is issued, it is indefeasible, (cannot be annulled) therefore it carries a secure and strong ownership.

"Ownership is clearly identified and verifiable so that banks and other financial institutions can carry out their mortgaging activities conveniently,” he said.

The title system will curtail many frauds like forgery and sale of land by a third party, Udayakantha said.

It helps mitigate other issues seen in the current deed system like loss or destruction of land documents, alteration of land records, illegal capture and writing deeds for state lands and under valuation of lands to reduce stamp fees.

Joint Titles

The project will also bring in the concept ‘joint titles’ as a condition in this title registration system.

Currently the lands alienated under Land Development Ordinance cannot be co-owned.

But technically most of the lands are getting fragmented due to unavailability of co-ownership.

Udayakantha says under the Land Development Ordinance, a wife can get life interest to a land but not co-owership.

In the ‘Joint title’ system husband and wife could have co-ownership
The compact also looks to move state lands conveyed under grants to the ‘private domain’ by registering as titles.

The ‘Bimsaviya’ project carried out by the government which is an existing project which converts property deeds to titles under the condition of obtaining permission from the divisional secretary.

Meanwhile, 11 million and 7 million US dollars are allocated respectively for digitizing land records and building up capacity of Valuation Department. 

A policy secretariat will also be set up for the government to examine any future issues, come up with solutions.

Continued Policy Reform

“The land policy secretariat will be proposing to the government how to have a better usage of land and how to have a better policy along with a better alienation process," Siriwardhane said.

"And better utilization of lands in economic and other activities will be proposed to the government by the secretariat.

“Within 5 years’ time, they will bring these proposals to the government and the government has the power to implement these,” he said.

Though the projects under the MCC grant tries to solve problems that have persisted for years or decades, that the government has been trying to address, there has been a lot of mis-information.


However, the project has been dogged by misinformation campaigns, by people who do not understand the project fully or have other motives.

“It was said that, 1.2 million acres in the Trincomalee –Colombo corridor are to be sold to the Americans at the rate of Rs.24.00 per month per acre,” Siriwardhane recalled.

"There is no truth in that statement. In fact it should be mentioned that the laws of Sri Lanka prohibits any action of such kind."

The US Ambassador, Alaina B. Teplitz said in a business council AGM, addressing the false beliefs on the land project that the United States will not own, control, or in any way administer any land in Sri Lanka under the guise of this agreement.

“The picture that the public has of the transport project is that the road transport corridor is to be set up between the ports of Colombo and Trincomalee with the Americans having an interest in the port of Trincomalee,” a document by the Compact Development Team addressing these issues said.

"MCC does not have an interest in the port of Trincomalee nor does it figure in the compact program development with the government."

MCC was also not involved in an electrified rail project from Colombo to Trincomalee, officials said.

MCC officials say a railway project cannot be done in a five-year period that MCC has to complete its work, other donors such as the ADB, Japan and India are already making large investments in this sector.

The Millenium Challenge Corporation Sri Lankan compact is the single largest grant given by a foreign government since the 1980s.(Colombo/19 Aug/2019.

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