The government has been able to gradually reduce the budget deficit, according to Professor Priyanga Dunusinghe, a senior lecturer in the Department of Economics at the University of Colombo.
Addressing a media briefing in Colombo, Professor Dunusinghe dismissed reports suggesting that the government had borrowed heavily over the past year, stating that such claims were incorrect.
He explained that due to limited access to international financial markets and bilateral lenders, the government has primarily relied on domestic borrowing. Moreover, with multilateral institutions offering fewer concessional lending facilities than in previous years, domestic borrowing has been necessary to bridge the budget deficit.
Professor Dunusinghe emphasized that there is no evidence of excessive borrowing under the current administration. On the contrary, he noted, the budget deficit has been steadily narrowing.
Meanwhile, Minister of Health and Mass Media Dr. Nalinda Jayatissa stated that the present government inherited a country that was neither economically stable nor prosperous.
He stressed that government spending must align with the strength of the economy at this stage. Achieving and maintaining revenue targets has been one of the main priorities of the administration, and, according to the Minister, those efforts have been largely successful.
Several revenue-generating state institutions have already surpassed their targets, while the government has exercised caution in managing public expenditure, Dr. Jayatissa added.
He further noted that although tax revenue collection currently ranges between Rs. 3,000 billion and Rs. 4,000 billion, not all of these funds had previously been utilized in a well-planned and targeted manner to benefit the public.
