Government to increase investment levels to 33-35 %

Indunil HEWAGE

The government is planning to increase annual investment levels to 33-35 % of GDP by 2016 of which, around 6-7 % is expected to be government investments while the private sector, both domestic and foreign is expected to invest around 27-28 %.

The government has taken several initiatives such as lowering taxes, strengthening banking and non banking financial institutions, improving infrastructure and others to boost investment. Identifying and removing barriers to investment has also given high priority.

Benefiting from large scale infrastructure investments, the private sector is expected to invest particularly in port related industries and services, tourism, IT/BPO, skills development, urban mixed development, agriculture and manufacturing sector and particularly in value added industries using domestic raw materials and resources.

The need for private investments in some import replacement sectors has been recognized and a wide range of tax incentives have been incorporated into tax laws including the Strategic Development Project Act of 2008.

The Board of Investment in collaboration with the line ministries are focusing on such investments for which specific project proposals and required domestic arrangements need to be firmed up to exploit potential areas of investment.