Govt. plans $21 b public investment through 2015

Wednesday, 16 November 2011 01:47 - - {{hitsCtrl.values.hits}}

Reuters: Sri Lanka has planned more than $ 21 billion in public investment through 2015, aiming to revive the island nation’s infrastructure after the end of civil war in 2009, the Central Bank Governor said on Tuesday.

Since the end of the war, Sri Lanka has allocated more than $ 6 billion to the development of ports, power plants, railways and highways, to meet needs neglected during the 25-year conflict and make the country more attractive for foreign investment. “Our public investment programme is more than $ 21 billion over the next five years,” Cabraal told Reuters.

“It will be around 6.5 per cent of our Gross Domestic Product each year. This will be spent towards all infrastructure.”

Sri Lanka has planned to spend $ 3.75 billion for public investment this year, $ 4.43 billion next year and $ 5.05 billion in 2013, Cabraal said. The number will rise to $ 5.76 billion in 2014 and $ 6.53 billion in 2015.

The increased infrastructure spending has boosted banks’ appetite to capture a piece of the post-war pie. India’s Axis Bank last month opened its first branch in Sri Lanka, and said it would focus on loan syndication for infrastructure.

Total foreign debt has risen 57.5 per cent to Rs. 2.3 trillion ($ 20.9 billion) through August, since the war’s end in May 2009.

Sri Lanka’s total outstanding debt as of end-August Rs. 5.1 trillion ($ 46.3 billion). As a proportion of GDP, it came down to 82 per cent in 2010 versus 86 per cent in 2009.

Opposition parties say Rajapaksa’s Government is spending beyond the country’s means and has pushed through the projects with minimal transparency, and awarded them to politically-connected firms and China.