Budget targets 8 to 10 pc economic growth

by Hiran H. Senewiratne

The Government has laid the foundation to achieve an overall economic growth of 8 per cent to10 per cent from the Budget that will be presented to Parliament today, the Finance Minister Dr. Sarath Amunugama said at a pre-Budget press conference at the Finance Ministry yesterday.

"This is not an impossible target since the foundation for this has been already laid. This year's Budget is pro-growth and pro-poor which reflects the same principles of last year's Budget," Dr Amunugama said.

The Finance Minister said the country has to maintain an 8 per cent growth for at least 10 years to eradicate poverty.

To achieve this target growth, services and amendments will be introduced in today's Budget to create a knowledge-based society, to fulfil the task," he said. He said Sri Lanka has become a lower income group country which obtained US$ 1,035 per capita for a year along with the educated workforce to achieve eight per cent to ten per cent growths. High income groups are mostly confined to the Western Province.

He said the National Council of Economic Development (NCED) which covers 23 important clusters in the country has put forward their proposals. These proposals have been taken into consideration along with the ideas of the public, Minister Amunugama said.

Meanwhile, State spending is likely to increase by 30 percent and it is expected to be Rs. 568.3 billion.

The State expenditure for 2004 was Rs. 438.6 billion.

The defence Budget too is expected to increase by over 20 percent to Rs. 69.4 billion.

The Government will depend on foreign debt, rupee loans and government bonds this year as well. The borrowing is expected to expand by around Rs. 100 billion to Rs. 536 billion. The Government's aim is to contain the Budget deficit to 8 percent.