The Asian Development Bank and Sri Lanka's government have initiated SUWERP to restore the country's degraded upper watersheds, establishing new governance structures and funding mechanisms to address severe soil erosion, water contamination, and forest damage.

The Asian Development Bank (ADB) and the Government of Sri Lanka have launched the Sri Lanka Upper Watershed Ecological Restoration Program (SUWERP) to address critical environmental degradation in the central highlands. The initiative follows Cabinet approval in June 2026 to establish the Upper Watershed Management Authority (UWMA), a governance body created in response to severe forest damage caused by Cyclone Ditwah. The government is simultaneously restructuring existing state agencies and introducing the Climate Action and Nature Positive Investment (CANOPI) Fund to provide sustained financing for restoration efforts.

Recent research commissioned by the ADB reveals alarming conditions in Sri Lanka's upper watersheds. The International Water Management Institute (IWMI) identified the Uma Oya catchment near Rantambe Reservoir as the most vulnerable zone, finding that agricultural areas including tea plantations and vegetable plots generate the largest volumes of soil erosion at 1.2 tons per hectare annually. Water quality testing across 21 locations breached safe drinking limits at 13 sites, with widespread pesticide contamination detected in agricultural zones. The study used hydrological modelling tools to map erosion patterns across 38 sub-basins, identifying the region between Welimada and Nuwara Eliya as the main erosion hotspot.

Expert perspectives diverged on blame for watershed deterioration. Biodiversity scientist Dr. Rohan Pethiyagoda rejected claims that the tea industry alone bears responsibility, arguing that properly managed tea lands actually prevent soil loss through drainage systems and ground cover. Instead, he identified poor land management, unsuitable crops like vegetables, and decades of government mismanagement of state-owned lands as primary culprits. Pethiyagoda advocated for Regional Plantation Companies to partner with the UWMA rather than be regulated, citing their existing workforce, infrastructure, and highland expertise.

Financial mechanisms are being developed to sustain restoration. Researchers are conducting economic valuations of watershed ecosystem services, examining how upstream land degradation affects downstream hydroelectric facilities and other industries. A proposed payment-for-ecosystem-services model, modeled on Costa Rica's approach, could apply a 1 percent levy on energy and water sectors to generate approximately Rs 23 billion annually. Pethiyagoda suggested reinvesting Rs 9 billion could employ 10,000 workers at Rs 75,000 monthly for watershed restoration.

Experts cautioned that new institutions must succeed where existing governance bodies have failed. Pethiyagoda warned that the UWMA and CANOPI Fund could replicate the performance failures of Sri Lanka's 27 existing authorities unless clear performance targets are established from the outset, legislation is carefully drafted, and outside scientific expertise is incorporated alongside government officials.