Abstract:
An increase in the poverty rate has a direct impact on the economic growth and
development of a country. According to World Bank Report Sri Lanka’s poverty is
projected to increase to 27.9 percent in 2023 from 25 percent in 2022. Sri Lanka’s
gem industry can be introduced as one of the strategies that can be used to reduce
poverty in the rural sector. Among them, attention should be paid to the small- scale
gem industry. When considering the small- scale gem industry, it can be divided into
two parts as small- scale gem trading and small- scale gem mining. It is the workers
who are engaged in small- scale mining rather than the traders who sell gems on a
small-scale who are most affected by poverty. Gems are a popular mineral resource
all over the world and are also widely distributed in Sri Lanka. Sri Lanka has a long
history of gemstones, and the gems of Ratnapura are famous all over the world.
Accordingly, the research problem of this thesis is to study whether rural poverty can
be reduced by developing small- scale gem mining industry. Accordingly, to find
solutions to this problem, research has been done based on three objectives. That is
to identify the causes of rural poverty in Sri Lanka and research study area (reasons),
to identify whether rural poverty can be reduced through the small- scale gem mining
industry (impact), and to identify what remedies can be applied through the small-
scale gem mining industry to mitigate rural poverty (solutions). According to the
research methodology, a sample of 60 people was randomly selected from Hopitigala
village in Gangulwitiya Grama Niladhari Division of Elapatha Divisional Secretariat
in Ratnapura district and data analysis was done under descriptive statistical and
econometrics analysis (multiple regression analysis) methods. There, factors such as
the education level, age, gender, nature of profession etc. have been taken into
consideration. The factors and reasons that cause the poverty in Sri Lanka and gem
miners in research area are lack of proper education level, less labor contribution of
women compared to men, exploitation of labor in gem industry, lack of sufficient
resources and capital for mining, problem of shares distribution in gem industry etc.
can be pointed out. In order to reduce rural poverty, providing incentives related to
the gem industry, encouraging the people in gem mining areas, expanding the gem
and jewelry industry in areas that receive and do not find gems, introduce training
courses to unemployment women and youth in gem and non-gem mining areas,
introducing gem exhibitions and research institutes, encourage people to engage in
the gem industry as self- employment, and many solutions can be taken to mitigate
rural poverty and develop gem industry. The research findings are that education level
has no direct relationship with gem mining, but factors such as age, gender and
service time have a strong relationship with gem mining.
