ABSTRACT
Structural change historically has come to mean changes or adjustments in the production, employment, institutional and foreign trade structures of an economy. Sri Lanka, like most of the third world countries before 1950, was subordinated to the developed world, politically and economically. With Independence there was a strong feeling of breaking away from the colonial production, employment and trade structures, dominated by primary production inherited by the country. This, as we have observed, led to deliberate policy action to diversify the production structures to give industrial activity a prominent position in diversifying the country’s economy.
