Sri Lanka, Oct. 31 -- Sri Lanka risks losing around US$24.4 million in annual rubber exports to the European Union (EU) if it complies with the bloc's new deforestation-free trade rules, the Institute of Policy Studies (IPS) cautioned.

The European Union Deforestation Regulation (EUDR), which takes effect for large companies on 31 December 2025, aims to curb deforestation linked to seven commodities, cattle, cocoa, coffee, palm oil, soy, wood, and natural rubber, and their derivative products such as tyres, chocolate, and wooden furniture.

The think tank said Sri Lanka's compliance with the regulation could result in a 7.6 percent reduction in rubber exports to the EU, equivalent to about US$ 24.4 million a year. If the country fails to...