Sri Lanka’s weakening currency is increasing pressure on the country’s import-dependent economy, raising concerns over a potential shortage of medicines as businesses struggle with soaring import costs. The Sri Lankan rupee has come under renewed pressure against the US dollar in recent weeks, sharply increasing the cost of importing fuel, industrial raw materials, machinery and pharmaceutical products. Industry groups warn that many sectors are finding it difficult to absorb the higher costs amid tight financial conditions and regulated pricing structures.

At the same time, Health sector representatives say the pharmaceutical industry is particularly vulnerable as Sri Lanka imports the majority of its medicines and medical supplies. Rising exchange-rate costs have significantly increased the rupee amount required to clear medicine shipments and place new import orders. Amid the mounting pressure on Rupee, challenges also add up in the form of an uptick in domestic prices, with official data showing inflation rising to 4.7% year-on-year in April 2026, up from 2.4% in March, according to the National Consumer Price Index.

Economists say the increase reflects renewed cost pressures driven largely by import-linked inflation. Meanwhile, Sri Lanka’s reform programme under the International Monetary Fund (IMF) continues to advance, with the IMF Executive Board scheduled to consider the combined fifth and sixth reviews under the Extended Fund Facility on May 27. IMF Mission Chief Evan Papageorgiou yesterday said the country has made significant progress in restoring macroeconomic stability, rebuilding reserves and strengthening economic confidence.