Boon for construction industry:

Loan interest slashed

Harshini PERERA

The People's Bank has slashed loan interest rates to 12 percent for the construction industry and related services. Individuals, corporate sector sub-contractors and other services related to the construction industry will be given loans at the new interest rate.

There will soon be a boom in the construction industry as the local contractors are being encouraged to undertake more constructions. The construction industry that covers roads highways, water services, ports and harbours, irrigation and power stations will immensely benefit by the reduced interest rates, People's Bank, Chief Executive Officer/General Manager, P V Pathirana said.

The decision was taken on the instructions of President Mahinda Rajapaksa and Treasury Secretary Dr P B Jayasundara to promote more construction in the country including the North and East.

The bank has reduced the interest rates from 15 percent to 12 percent for construction work.

"Many contractors need working capital and capital expenditure during the process of construction to which the State banks will give them assistance by introducing the new interest rate. The interest slash will have multiple benefits as other services related to the construction industry such as carpentry, landscaping and interior designing too will benefit. Thus, many small and medium-scale industries related to construction can access the loan facilities under the new interest rates which will lead to enhance the living conditions of the people," he said.

The improvement in people's living conditions will enable the country to reach the target of US $ 4,000 per capital income from the current US $ 2,000.

"The People's Bank will encourage contractors to be eco-friendly in their construction as a responsibility towards country. We will be providing micro finance for small entrepreneurs related to the construction industry," he said.