Economy

Budget 2013 will usher a new era

The following article is based on the speech by Economic Development Minister Basil Rajapaksa during the debate on the second reading of the Budget for the year 2013.

"I have to briefly comment on the budget, its fundamentals and the analysis some people made of the budget during the debate. During the 2005 Presidential Election campaign, President Mahinda Rajapaksa introduced a vision for building a new Sri Lanka, based on the Mahinda Chinthana concept. Instead of discarding this concept after the election, he made it a set of policies and an economic and social programme to be implemented during his presidency.

It was the same with Mahinda Chinthana, vision introduced later in 2010. This is a budget aimed at providing every citizen with an opportunity of benefitting from dividends and thereby improving their living conditions. It is based on several points in the Mahinda Chinthana and the Mahinda Chinthana Vision.

All our ancient rulers knew that without ensuring the people's food security, it was impossible to protect the nation's dignity, independence and sovereignty. This very reason made our people make sure our country was self sufficient in food. We have drawn special attention to food security in view of the current global situation. Equally important is water. It is very difficult to find another country with a civilization based on irrigation such as ours.

Environmental protection is essential for protecting water resources and ensuring clean air. All living beings need these for their survival. We know that lack of clean air and environmental degradation are among the major problems that are faced in developing countries. Hence, we have taken environmental protection as the basis for this budget.

The difference between humans and animals began with the use of energy. It is from this usage that man moved forward. The entire budget has focused on energy conservation and reusable energy.

In every budget of the President, steps have been taken to provide everyone with electricity, water, housing, sanitation, a good education for the children and health services in accordance with the Mahinda Chinthana and the Mahinda Chinthana Vision. This budget too is aimed at achieving these goals.

A main target of the Mahinda Chinthana is the individual and family for the well-being of which various programmes have been launched and funds allocated. Especially through the Divi Neguma concept, we hope to pay attention to all families and individual family members. The budget has provided relief assistance for this purpose. Whatever the job or profession of a person is, whatever his weaknesses are and wherever he resides, measures have been taken under this budget to improve his living standard.

Every budget of ours had focused on the village. We know that over 80 percent of our people live in villages and plantation areas. The village is the foundation of our country. Its foundation has been 36,000 villages and 14,026 grama seva divisions. Therefore, we have included road networks, power, water, irrigation, schools, temples and even maternity clinics as areas requiring attention under the Gama Neguma village development programme.

This budget shows facilities provided for the development of small towns under the Pura Neguma. Allocations of around Rs 1 million had been made to each of the 14,026 grama seva divisions for the development of villages into small towns under the Pura Neguma. In addition, a proposal had been made for the first time under this budget, to provide monetary assistance to 206 pradeshiya sabhas, which receive an income of less than Rs.1 million. Funds have also been allocated under the Palath Neguma for every Provincial Council to focus on development schemes that meet the specific needs of each PC area. Here, I have to counter the allegation, a Tamil National Alliance MP has made saying that funds allocated to the North is less than what had been given to other provinces. I request him to have a look at page 334 of Volume 3 of the budget estimate 2013 (draft). In it the first to come under regional pradeshiya development is the North. The amount allocated under the Uthuru Wasanthaya is Rs. 8,307 million. Only Rs. 2,285 million has been allocated to Ruhunu Udanaya for development of the South. Rajarata Navodaya has got even less - Rs. 1,735 million - for developing the North Central Province. The next major allocation of Rs. 3,068 million has been made to Ran Aruna , covering the Western Province. Apart from this, no other province had been allocated more than Rs. 2000 million.

Palath Neguma will be followed by programmes to uplift the entire country. It is for this purpose that we are investing on a large scale. The MP who spoke earlier on the Hambantota Port and the Southern Expressway, showed the yearly income they generated. If such persons were there when King Dhatusena built the Kala Wewa, or King Parakramabahu built the Parakrama Samudra, they would ask the reason for building it, after calculating the value of the paddy from the first harvest. Then they will say it would take years to benefit from the project. If such arguments are raised in those days, we would have neither the Kala Wewa nor the Parakrama Samudra. These are long term investments. Please do not be hypocritical. These are investments being made for the sake of future generations. It is because Kings Dhatusena and Parakramabahu who built water ways like the Jaya Ganga, that our country became self-sufficient in food. It is because of constructions like Sigriya that we can proudly talk about Sri Lanka's history.

We made massive investments to develop our country. The building of the Hambantota Harbour and the Colombo South Harbour were delayed for years. Every government including the UNP, attempted to build these.

Minister Basil Rajapaksa visiting a agriculture project

When our harbours were unable to accommodate huge container ships because of the increasing size of such vessels on world's sea lanes, the number of ships calling at our harbours will lessen invariably, causing an increase in shipping costs. When it is possible to transport goods at a much lesser cost on a container ship that could carry 50,000 tons, we are compelled to pay more for transporting on small vessels because we do not have a harbour to accommodate larger ships. Consequently, we are driven out of the market. Every exporter in this country stresses the need for a bigger harbour.

When the speed of economic progress increases and every village and house is supplied with electricity, more power generation is needed. We had a plan experts had drawn up for generating electricity. That plan had not been implemented. The Norochcholai coal power plant, Upper Kotmale hydro electric power plant and the Kerawalapitiya power plant had all come to a standstill. But since the President took a bold step and commenced work on these projects, Sri Lanka has become the only South Asian country that has a 24-hour electricity supply seven days a week with no power cuts.

You are aware of the conditions of other public services when he took over the country. Foreign investments had come to zero and tourist arrivals had completely ceased. The strength of the state sector had been completely reduced and it was doing only day to day work. No capital investment had been made in this area when the President took over the country. Even the people had been deprived of their fundamental rights to live. I wish to stress here that it was only after he took over the reins that the country was brought under one flag and the people's right to live was secured. The rest was achieved thereafter.

If we look at this horizontally, programmes have been worked out in the budget to develop the individual and the family, village and town and the country. Increased investments have been made in each of these areas under this budget. Our first priority is agriculture linked to food security. This country has achieved great success in the field of agriculture.

After suppressing the Uva uprising, the British Imperialists realized that our country being an island, we had ensured food security and self-sufficiency since ancient times. They saw that the reason for our pride, sovereignty and self-confidence was our self-sufficiency in food. So what did they do? They destroyed our village tanks, reservoirs and irrigation systems and destroyed our self-sufficient economy. As a result, we were compelled to import rice to feed our people. During World War II, the people of this country had to eat a very low-quality rice variety called Bajiri.

Thereafter, our people were made to become addicted to American wheat flour. After independence, several Heads of State tried to make this country self-sufficient in rice. The effort began with former Prime Minister D.S. Senanayake and they continued under leaders such as S.W.R.D. Bandaranaike, Dudley Senanayake and Sirimavo Bandaranaike. But they failed to achieve the goal.

But President Mahinda Rajapaksa succeeded in reaching the target by providing the farmers with fertiliser subsidy, cultivating abandoned paddy lands, repairing big and small irrigation systems and building new irrigation schemes. All this helped our heroic farmers to make this country self-sufficient in rice.

The Mahinda Rajapaksa Government succeeded in restoring food security and self-sufficiency in food for the first time in 100 years, after it was destroyed by British Imperialists. Also our country is becoming self-sufficient not only in rice, but also in sorghum. We have achieved a major victory in sorghum cultivation.

The staple food of people in the North is 'ulundu' over 85 percent of which used to be imported until two years ago. When we re-startedcultivating it in the Wanni, there were no seeds for distribution among farmers.

Therefore we imported the seeds from India and distributed them among farmers.

I am proud to say that farmers in the Wanni have today succeeded in producing all the 'ulundu' this country needed. Furthermore, we are reaching self-sufficiency in many other crops.

The President has posed a challenge to the Agriculture Ministry and to the farming community to make the country self-sufficient in all food items it needed.

This budget has guaranteed to provide all the relief and security required for achieving that goal. We have also made a big investment to boost the country’s milk industry. After 26 years, we have imported the highest number of dairy cows and distributed them among the farmers.

The aim is not only to raise the income level of our dairy farmers by saving the money spent on powdered milk, but also make our people a healthy nation. I wish to say today that 60 percent of Nestle’s milk is bought from farmers in the North, bringing them a good income.

Today milk collection centres have been set up not only by Milco, but also by private companies. Our idea is not to bring the milk from villages to Colombo and sell them in packet form, but to encourage people in milk production areas to consume it. In addition to exports, we have taken steps to improve facilities to store fish for longer periods and also to produce salmon, which our villagers relish.

This government has been able to make the kitul industry a major foreign-exchange earner. We have taken measures to boost small and medium scale industries and develop the sugarcane industry to meet the requirements of investors and tourists.

The biggest challenge the country faced this year was the drought. Our farmers suffered incalculable losses due to the drought which also seriously affected energy generation. The breakdown of the coal power plant stopped production. American sanctions on Iran reduced the supply of oil from Iran to our refinery. Despite these and other negative factors, we were able to manage our economy. This budget has provided relief to 1.5 million farmers. For government employees, 1.3 million had been allocated.

There are 500,000 pensioners, 1 million war heroes, 600,000 parents of war heroes, I million tea, rubber and coconut small holders and 5 million medium and small scale entrepreneurs. In addition to these, there are around 100,000 artistes, those who lost their jobs in the July 1980 strike, female entrepreneurs and disabled people. Accordingly, the total number is 10.9 million.

We hope to reduce infant mortality rate to two per thousand. The number of deaths of mothers had come down from 4.45 per 10,000 to 3.11 per 10,000. We hope to reduce this to 2.3.