This book examines the direct investment policy experience of Sri Lanka during the Dutch and the English colonial regimes since 17th century and inquires in details into the political economy of the post-colonial direct investment reliant development. The book builds upon a comprehensive discussion of the development theory of foreign direct investment in the first place and then it analyses the direct investment policy since the colonial period placing special emphasis on the policy discrepancies of different governments during the post-colonial period. Finally the book explores meticulously the development response of the economy of Sri Lanka to the direct investment policy both theoretically and empirically. The historical time series data, information and analyses presented in the book have made it unique and resourceful encyclopedic volume of foreign direct investment in Sri Lanka. This comprehensive study is a key source book for researchers in the field of direct investment policy and economic development in Sri Lanka.