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Incentives to promote small, medium scale industries

The government has introduced a wide range of incentives to resuscitate the rural economy by improving small and medium scale industries to raise the income level and generate more employment,  Cabinet Spokesman and Minister Prof. G.L. Peiris said yesterday. Accordingly, there will be a complete change in the tariff structure to develop the agricultural and small scale industries in the country. Import tariffs on agricultural and industrial products will be raised while a variety of tax incentives will be introduced on small and medium industries. "The decision is aimed at providing reasonable protection to local farmers and small scale entrepreneurs who are unable to compete with the imported products", the Minister said.

"Through this initiative, strong tax incentives will be given to small and medium industries in the country who have limited resources".

The program also includes a package of incentives for small entrepreneurs who do not have access to the banking system. People who invest more than Rs 1 million before March 31 next year will also be entitled to these tax incentives," he said. Some food items which will be subjected to the increase in import duties. Minister Peiris said that the additional duties will be imposed in a way to protect the consumer.

"The program will be taken up for discussion in Parliament on March 19," he said. The grant of incentives will be paralleled by an Investment Development Board program to grant loans to small scale industrialists who emerge with viable plans.

The project funded by the Asian Development Bank will distribute 60 million US dollars among local industrialists through 10 branches of the DFCC Bank. They are Anuradhapura, Polonnaruwa, Matara, Kandy, Ratnapura, Colombo, Gampaha, Kalutara, Kurunegala and Badulla.

The Export Development Board is also currently implementing a program in export promotion villages to increase the income of the agricultural sector. Such villages have already been established in Galgamuwa, Angunukolapelessa, Godakawela, Uva Paranagama and Puttalam. "The move is aimed at reducing the difference between the farm-gate price and the price paid by consumers due to middlemen. Accordingly, produce will be collected from the farmers directly," Prof. Peiris said.

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