Finance Minister Mangala Samaraweera and Japanese Ambassador Kenichi Suganuma jointly launched Sri Lanka’s first electric three wheelers yesterday in an effort to bring down transportation costs and to encourage transition to environmentally friendly transportation alternatives.
Speaking at the launch of the "Electric Tuk Tuk" at the Waters' Edge Hotel yesterday, Finance Minister Samaraweera said with more than one million three-wheeler drivers in Sri Lanka, the three-wheeler industry is indeed a major sector of the country. “The ‘Sri Lankan tuk’ has in fact become something of an icon as it is used in myriad aspects. It is an affordable means of transport for small business, providing last mile connectivity for SMEs and entrepreneurs. Three wheelers are a means of affordable private transportation as well, and are increasingly popular in the tourism industry.”
The government of Sri Lanka has recognised the importance of this sector to the economy and intends to further empower those involved in the industry. In the 2018 budget, Finance Minister Samaraweera proposed to introduce the ‘tourist friendly tuk-tuk’ concept in collaboration with the hospitality industry. This programme provides for existing three-wheeler drivers to register with the SLTDA so that a three-wheeler would not only be a mode of transportation, but the driver to serve as a local tourist-guide as well. This policy was initiated to create a win-win situation for all stakeholders involved and improve the quality of services provided in the tourism industry. This program is now being implemented successfully with 589 drivers joining the training programmes already.
The introduction of electric three-wheelers to this industry is another important new policy. Minister Samaraweera said, there are several reasons for the shift from the fossil fuel tuk to the electric version, and environmental concerns are chief amongst them. As part of the Paris agreement, Sri Lanka has pledged to reduce greenhouse gas emissions by 10% in the transport sector by 2020. Among the host of recommendations, one way to achieve this reduction is to convert the existing vehicles to ‘zero-emission’ vehicles, which would cause minimum levels of pollution and carbon footprint.
The number of three-wheelers in Sri Lanka has increased eight-fold since the year 2,000. The fuel consumption per person has increased from 90 litres to 150 litres during the same time. In 2017, Sri Lanka spent nearly USD 3.5 billion to import fossil fuels for the generation of electricity and transportation. This is equivalent to around 4% of GDP. Therefore, Sri Lanka needs a longer term sustainable solution to mitigate the negative environmental consequences that arise as well as a solution to minimise the forex outflows from the country.
“As a result, the vehicle policy in the 2018 budget too was designed to incentivise to move to a greener fleet of vehicles. The excise tax is structured such that diesel and petrol vehicles are taxed at a higher rate, making hybrids and electric vehicles more attractive. The loan to value ratio for electric and hybrid vehicles is also more favourable to encourage this segment of the market.
“Additionally, the import taxes on a diesel three-wheeler will be increased by Rs. 50,000 to encourage the transition to environmentally friendly alternatives.Furthermore, under the Enterprise Sri Lanka credit schemes, the Ministry of Finance will incorporate a subsidised loan scheme to enable three-wheeler drivers to invest in a multitude of additional services including meters, WIFI, GPS facilities, that would act as value-added services that are already provided to consumers; both domestic and tourists.We are also developing a proposal to encourage entrepreneurship amongst the spouses of three wheeler drivers,” he said.
The electric three-wheeler has been developed by Japan Sri Lanka Comprehensive Partnership secretariat and T-PLAN, with the incorporation of some of the cutting-edge technology available in this industry. The first batch of electric three wheelers manufactured in Sri Lanka will be ready by mid-2020, in time for the 2020 Tokyo Olympics. “It is very exciting to hear that T-PLAN hopes to export the Sri Lankan made electricvehicles to Japan. This would be the first of many technology transferprojects that are currently being incubated by the Japan Sri Lanka Comprehensive Partnership secretariat,” the Minister said.
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