Sri Lanka...

The debt-to-GDP ratio target is set at 95% by 2032, though current progress suggests the target could be met earlier.

- 

Primary expenditure, excluding interest, is capped at 13% of forecast GDP, with the primary balance target for 2024 already surpassed in the first half of the year.

Public investment is subject to a minimum 4% of GDP cap, with 2025 capital expenditure focused on infrastructure such as roads, bridges, and digital connectivity. Budget allocations, he said, are now aligned with published fiscal strategies rather than ministerial discretion.

“What is most important is the capital expenditure or public investments. We are struggling to expedite the capital expenditure owing to inherent factors. Mainly, we happened to delay our budget due to several elections. However, we are trying hard to reach the maximum level of capital expenditure within this given time. Without the capital expenditure, it is not that easy to reach the expected growth levels,” the Deputy Minister said.

As far as the Government policy is concerned, what we think is we invest as much as possible to develop infrastructure to enhance economic activity, improve doing business and attract investments, he said.

Revenue performance is ahead of target across Customs, Inland Revenue, and Excise Departments, aided by digitalisation. The Government aims to reduce relatively high indirect tax rates by broadening the tax base and improving administration. “If our tax base is broadened and tax administration is improved, we can reduce these taxes,” he said.

Prof. Fernando said the Government was prioritising the creation of a stable and fair policy environment for investor planning. Stock market regulation is aimed at reducing volatility and ensuring equal access to information. “Markets should not be simply driven by information that could be accessed by the very few. Publicly available information should be freely available to everyone,” he said.