Sri Lanka’s economy grew 5.1% year-on-year in the first quarter of 2026, extending its recovery momentum as industrial activity, services and agriculture all recorded positive growth, according to data released by the Department of Census and Statistics and reported by Newsfirst.

Gross Domestic Product (GDP) at constant prices increased to LKR3.65 trillion ($11bn) during the January-March period, up from LKR3.48 trillion a year earlier. At current prices, Sri Lanka’s GDP rose 11% year-on-year to LKR9.16 trillion in the first quarter of 2026.

The industrial sector was the main driver of growth, expanding 7.2% from the corresponding quarter of 2025. Strong performance in construction and mining activities, coupled with continued gains in manufacturing, helped lift overall output. Construction was among the standout contributors as investment activity and demand for building materials improved.

Sri Lanka’s services sector, the largest component of the economy, grew 3.4% during the quarter. Financial services, insurance, information technology and tourism-related businesses recorded notable gains, supported by stronger economic activity and a gradual improvement in domestic demand.

Agriculture also returned to growth, recording a 1.1% expansion after contracting during the same period last year. Improved performance in several crop segments helped offset weaker results in fisheries and some plantation-related activities.

The latest figures indicate that Sri Lanka’s economic recovery remained resilient despite a challenging external environment. The first quarter was affected by disruptions linked to Cyclone Ditwah and growing geopolitical tensions in the Gulf region toward the end of the period.