CABINET DECISION

Mid Year Fiscal Position Reports - 2011

This contains the information of government revenue, expenditure, cash flow activities and borrowings within the first four months of the year. This also contains data on macro-economic performance, price development, foreign aid, government debt and external sector performance.

The proposal made by the President to present this report in Parliament was approved by the Cabinet.

Livestock Master Plan - a strategy for Livestock Development towards Self-sufficiency Livestock Development Policy Document

The master plan which contains the strategy for livestock Development to reach self-reliance level by 2015 has been prepared on a proposal made by Livestock and Rural Community Development Minister Arumugam Thondaman.

The livestock sector accounts to nearly 1% of the GDP in Sri Lanka. There are about 670,000 smallholders engaged in this sector. It has been estimated that by 2016, the country will need 785 million litres of milk, 2,000 million of eggs and 200,000 mt of poultry meat annually.Cabinet approval was granted for this master plan to be implemented with the participation of the private sector as well, and also in keeping with the government’s development policy framework.

Tourism development strategy 2011-2016

The tourism sector has been identified as one of the key sectors developing the country’s economy.

There has been a significant increase in tourist arrivals immediately after the conflict situation in the country, with total arrivals surpassing 650,000 confirming the fact that Sri Lanka has been globally acclaimed as one of the finest destinations for tourists.

The development strategy for 2011 to 2016, submitted Economic Development Minister Basil Rajapaksa, which covers wider issues relating to the industry such as the government policy, capacity and manpower requirements, infrastructure development, improving service standards, marketing and promotions, public relations, tourist safety and domestic tourism etc was approved by Cabinet.

It has been estimated that by 2016 the industry will be capable of creating 500,000 direct and indirect employment opportunities.

Procurement of two MRI scanners to Teaching Hospital Kandy and Teaching Hospital Karapitiya

The proposal made by Health Minister Maithripala Sirisena to purchase the above machines for teaching hospitals in Kandy and Karapitiya at a cost of Rs 400 million, with funds to be allocated to the Health Ministry was approved by Cabinet.

Other hospitals which need MRI scanners will also be identified and the machines will be provided to the hospitals through medium tern expenditure framework from 2012 to 2014 prioritizing such supplies according to its needs.

Financial assistance from Asian Development Bank to implement Pura Neguma - Local Government Enhancement Project

On a proposal made by the President, loan negotiations are to be held with the Asian Development Bank on August 3 and 4 to obtain US $ 59 million financial assistance (approximately Rs 6.5 billion) to improve the local government infrastructure and Service Delivery through implementation of the Pura Neguma - Local Government Enhancement Project.

The total investment for the project is US $ 68.77 million, which includes a loan of US $ 59 million from the Asian Development Fund and government contribution of US$9.77 million.

The project will provide capital grants to selected Local Authorities for eligible sub-projects such as, water supply and sanitation, drainage, solid waste management, roads and bridges, improvement of maternity and health care centres, public markets etc.

Cabinet approval was granted to enter into a loan agreement with the Asian Development Bank for US $ 59 million for the project.

Project for the construction of Manmunai Bridge across the Batticaloa Lagoon with Japan International Cooperation Agency assistance

The government of Japan has agreed to provide grant assistance for approximately Rs 1,640 million for the construction of Manmunai bridge and causeway across the Batticaloa Lagoon.

This will reduce the distance between the East and West Banks of the Lagoon from 32 km to 300 metres and the distance from Manmunai West Bank to Batticaloa from 27 km to 15 km.

The proposal by the President, to sign the exchange of notes with the Japanese government to obtain the grant of Japanese Yen 1206 million and to enter into a grant agreement for the purpose with the Japan International Cooperation Agency (JICA) was approved by the Cabinet.

Food Aid assistance from World Food Programme to Sri Lanka for 2011

The World Food Programme has agreed to provide food aid assistance under protracted Relief and Recovery Operation (PRRO) and Emergency Operation (EMOP) to Sri Lanka and Letters of Understanding are to be signed for the programmes between the government and the WFP.

The programmes’ objectives are to support the government in its efforts to provide relief to the affected people and for rehabilitation activities.

The two programmes consist mother-child health nutrition, food for education for all primary students in selected schools, food for work programmes and food distribution for the displaced people in camps.

The PRRO programme will be implemented in Mannar, Vavuniya, Mullaitivu, Kilinochchi and Jaffna districts and selected areas in the Eastern Province and the estimated number of beneficiaries would be 371,000.

The EMOP programme will be implemented in selected Divisional Secretariat Divisions in Ampara, Batticaloa and Trincomalee Districts and Anuradhapura and Polonnaruwa Districts.

The proposal made by the President to sign the Letters of Understanding with the WFP for US $ 39,755,501 and US $ 8,869,131 to implement the WFP Food Aid Programmes in Sri Lanka was approved by the Cabinet.

Capitalization of Srilankan Airlines and Mihin Lanka

The proposal made by Civil Aviation Minister Priyankara Jayaratne to increase the fleet of aircraft of SriLankan Airlines from 17 to 23 by 2014, to be used for international air transportation and for an equity investment of US$ 500 million over five years on an annual basis commencing from 2012 was approved by the Cabinet.