Concessions in Budget a challenge: PB

Thursday, 11 October 2012 00:35 - - {{hitsCtrl.values.hits}}

By Devin Jayasundera

Treasury Secretary Dr. P.B Jayasundera yesterday stressed that energy expenditure as well as the ongoing global downturn would limit concessions given by the Budget to the masses.

He noted that considering these constraints the Government would have to make strong adjustments in the economy to sustain its achieved targets and expedite growth.

With regard to the country’s unfavourable weather and its impact on agriculture in many areas in the country, Dr. Jayasundera pointed out that there had been a damaging impact not only to the agricultural sector but also to the energy sector.

“Sri Lanka’s hydro energy sector has slumped to 18% of the national power supply and this means that we need to move into much more expensive alternatives such as coal and thermal power plants.”

He added that these challenges provided opportunities to look at renewable energy.

He pointed out that India was slowing down by 5.5% and China by 7.5% due to energy costs. Dr. Jayasundera indicated that Sri Lanka would have to face similar consequences if it did not make any serious adjustments in responding to the uncertainty of the Middle Eastern economy.

“The country’s budgets are framed in these challenging circumstances. Despite these numerous challenges, the Government has been able to instil necessary tax reforms, forex liberalisations, open opportunities for the private sector, and also implement healthy financial regulations to stabilise the banking and financial sector,” he added.