Budget to focus on infrastructure development

Hiran H.Senewiratne

The 2008 Budget would mainly focus on infrastructure development, and aim to lower the deficit by 7.5 per cent, to achieve long term sustainability, Deputy Finance Minister Ranjith Siyambalapitiya said.

He said it was prepared with great challenges, and has taken measures to control the high inflation rate in the country.

The 2008 Budget has been integrated to the ten-year development plan and now it is heading towards the third year of the plan, Minister Siyambalapitiya said.

The 2008 Budget has taken several measures to improve infrastructure development and is the main priority, he said. This year's budget has taken various measures to curtail inflation and the cost of living in the country, he said. This year's budget was able to reduce the deficit by 7.5 per cent and last year it was 9.1 per cent.

The budget integrated to the Mahinda Chintanaya will give emphasis to increase production and curtail inflation before end of 2008 Minister Siyambalapitiya said. This year it has given priority to provide employment for graduates.

Finance Secretary Dr P.B Jayasundera said next year Sri Lanka will cross the US$ 1500 per capita income. Measures to take the development process for rural areas with the development of infrastuture projects in the country from the 2008 budget can be expected, he said.

He said more than US $ five billion foreign aid for major development projects will be sought under the new budget.

To manage the large budget deficit it has proposed measures such as tight monetary policies by the Central Bank, reduce huge transaction costs and improve the living standards of the rural poor.

Next year the Central Bank will be directed to maintain tight monitory policies in a bid to bring down the waste. Major part of the sovereign bond funds will be spent for infrastructure development and it's the intention of the government to bring down inflation to a single digit by next year," the Minister said.

Committing on the budget deficit, he said that the revenue collecting bodies such as Inland Revenue, Customs and excise Department will be strengthened to spin more revenue for the state coffers. Bringing down the cost of living through sustainable development too would be a priority in the budget.

The government has also focused attention to stream line more employment generating projects especially in the rural areas.