Software Development and Outsourcing Industries in Sri Lanka

Sri Lanka’s Information and Communication Technology (ICT) Services sector represents a vital component of the nation’s export portfolio, ranking as the fourth-largest contributor to foreign exchange earnings. Notably, Sri Lanka’s ICT sector maintains a strong commitment to aligning with global labor and environmental standards, a critical factor contributing to its sustained growth. One of the sector’s core strengths lies in the availability of a highly skilled talent pool, coupled with robust operational capabilities. This synergy positions Sri Lanka’s ICT services and software development sector as a competitive player on the global stage. This makes outsourcing software development in Sri Lanka a smart choice for businesses worldwide. The nation’s workforce has consistently demonstrated its ability to deliver high-quality services, earning accolades from clients worldwide.¹

Sri Lanka as an Economy

Sri Lanka, formerly known as Ceylon, is an island country in South Asia. It is located in the Indian Ocean, southwest of the Bay of Bengal, separated from India by the Gulf of Mannar and the Palk Strait. Sri Lanka has maritime borders with the Maldives to the south-west and India to the north-west. It is officially called the Democratic Socialist Republic of Sri Lanka.

Sri Lanka, positioned at 73rd on the Human Development Index, is a developing nation that stands as the top South Asian country in terms of development, boasting the second-highest per capita income in the region. Despite these achievements, the current economic crisis has triggered a collapse in its currency, heightened inflation, and a humanitarian emergency marked by severe shortages of essential goods. Sri Lanka’s extensive history of involvement with global organizations includes being a founding member of SAARC and a participant in the United Nations, the Commonwealth of Nations, the G77, and the Non-Aligned Movement.

Sri Lanka’s Economy at a Glance

	Gross Domestic Product
Annual GDP		USD 84.3 Billion (2023)
GDP Per Capita		USD 3,828 (2023)
Income Category		Lower-middle Income (2025)
	People
Population		23.2 Million (2025)
Literacy Rate		92% (2022)
EF English Proficiency Index		Low Proficiency (2024)
	IT Sector
IT Services Market Size		USD 852.4 Million (2025)
IT Outsourcing Market Size		USD 293 Million (2025)
Registered Software Companies		300+ (2025)
	Business Environment
Ease of Doing Business		USD 852.4 Million (2025)
Political Stability Indicator		Percentile Rank: 25.6 (2023)
Corruption Perceptions Index		Score: 34/100 | Rank: 115/180 (2023)

The Growth Story of Sri Lanka’s ICT sector

The ICT industry in Sri Lanka is a thriving sector that provides software products and services to various global regions, including North America, the European Union, Australia, East Asia, the Middle East, Africa, and the Nordic region. Sri Lankan companies excel in several key areas, such as automated application testing, Enterprise Resource Planning (ERP), cloud technology, and mobile applications. Moreover, Sri Lanka serves as an offshore development center for numerous Fortune 500 companies from the United States, Ireland, the United Kingdom, Australia, and Sweden. Joint ventures also exist with companies in Sweden, Norway, the United States, and Japan.

The growth of Business Process Outsourcing (BPO) and Knowledge Process Outsourcing (KPO) has played a significant role in the IT sector’s expansion. Sri Lanka’s excellence in this field was recognized when it received the Delivery Destination Award in 2019 from the Global Sourcing Association (GSA) of the United Kingdom. Additionally, the Sri Lanka Association of Software and Services Companies (SLASSCOM), the national chamber for the IT-based knowledge and information industry, is actively involved in business facilitation, education, employment enhancement, research, and innovation within the sector (CBSL, 2019).

Sri Lanka ranks 85th among the 132 economies featured in the Global Innovation Index (GII) 2022², surpassing Pakistan at 87, Bangladesh at 102, and Nepal at 111. This demonstrates the country’s growing potential in the field of innovation and its competitive edge in the region. The Global Innovation Index (GII) ranks world economies according to their innovation capabilities. Consisting of roughly 80 indicators, grouped into innovation inputs and outputs, the GII aims to capture the multi-dimensional facets of innovation. In 2022, Sri Lanka demonstrated advancements in both innovation inputs and outputs. Historically, the country has consistently excelled in outputs compared to inputs at various levels. This indicates a capacity to achieve more with fewer resources. However, certain key figures underscore the need for increased investment in education, research, and development, particularly in the STEM fields.

Adaptability and Resilience of Sri Lanka’s ICT sector

Sri Lanka is actively evolving into a favored ICT hub, driven by its exceptional pool of skilled professionals offering a diverse array of services. However, it is crucial to acknowledge that the recent economic crisis in Sri Lanka has posed challenges to this otherwise thriving sector. Some companies within the industry are proactively devising contingency plans, which include the possibility of relocating staff to other countries should the economic situation deteriorate further. This prudent approach reflects the sector’s adaptability and resilience in the face of adversity.

Reputed ICT and Software Companies in Sri Lanka

We have analyzed publicly available data on ICT companies in Sri Lanka and compiled a list of those significantly contributing to the local ICT sector by employing a substantial number of ICT professionals.

Sri Lanka Association for Software Services Companies (SLASSCOM)

The Sri Lanka Association for Software Services Companies (SLASSCOM) serves as the national chamber for the knowledge and innovation industry in Sri Lanka, playing a pivotal role in fostering growth. The organization facilitates trade and business, promotes education and employment, encourages research and innovation, and influences a national policy framework beneficial to the industry. With a membership exceeding 200 software companies, SLASSCOM contributes significantly to the development of the ICT sector.

SLASSCOM also has a learning arm, named SLASSCOM Academy, that aims to deliver learning opportunities associated with the latest technology aspects to everyone interested. Regardless of the learners’ level of education, experience, or expertise, they have suitable opportunities and learning programs. The academy offers access to valuable insights in terms of upskilling, cross-skilling, reskilling, and task-skilling in the ICT industry. The learning programs are designed and delivered in accordance with global standards, ensuring a high-quality and standardized educational experience. Additionally, the academy provides a localized digital learning experience, combining the advantages of digital education with a tailored approach to the Sri Lankan context.

Reputed Institutions in Sri Lanka Renowned for Top ICT Graduates

Among the key players of Sri Lanka’s ICT sector, it has come to our attention that a significant proportion of talent is consistently recruited from the following institutions, among various others. These institutions are also acknowledged as significant contributors to the talent pool within the ICT sector in Sri Lanka.

Conclusion

Sri Lanka’s ICT sector is a key part of the economy, ranking fourth in foreign exchange earnings. It stands strong with a skilled talent pool and global standards. Despite challenges, the sector remains resilient and continues to grow. Leading IT companies and top institutions produce highly qualified graduates. SLASSCOM and SLASSCOM Academy support this growth through education and trade initiatives. As Sri Lanka navigates its economic challenges, the ICT sector remains a beacon of innovation and adaptability, contributing significantly to the nation’s development.

If you’re looking to outsource in Sri Lanka and tap into its thriving IT sector, let us help you connect with the best companies through Enosis Outsourcing. Contact us today to learn more and explore the opportunities Sri Lanka has to offer!

References

[1] Sri Lanka- Telecommunications and Information Technology (trade.gov) ↩

[2] Global Innovation Index 2022 | Sri Lanka ↩