The main objective of this paper is to explore the possibility of applying the Scandinavian model of democracy to Sri Lanka. It looks into specific aspects of the Social Democratic model as the way forward to bring peace to Sri Lanka, and compares that prospect with one for a form of popular democracy or a protective state with grass roots democratic structures that emphasize egalitarian social justice. It also examines if is it possible to transfer the Scandinavian Social Democracy model, in whole or part, to Sri Lanka not as a lasting solution to its current political crisis but as a useful step towards popular democracy or a people’s state. In Sri Lanka, options for future development are narrowing to a choice between totalitarian and democratic routes. This paper is based on a preference for the democratic option such as a people-based democracy.