Sri Lanka on a progressive path: President

Nov 21, 2011 (LBO) – Sri Lanka is travelling new road turning its back on a “very destructive” path the country started to tread from 1977, President Mahinda Rajapaksa said presenting a budget for 2012.

After taking over in 2005 he ended a 30-year war wiping out Tamil Tiger separatists, boosted the rural economy and built infrastructure, he said.

President Rajapaksa outlined a budget that will bring the deficit down to 6.2 percent of gross domestic product in 2012 from 7.0 percent in 2011.

He also proposed a surprise 3.0 percent devaluation of the exchange rate, an unusual event that has not been seen in the country for decades.

Trading in forex markets ceased for the rest of the day.

Expropriation

President Rajapaksa defended a controversial law to expropriate some 37 businesses saying it was not against property rights. The ruling coalition commands a two thirds majority in parliament.

“All such assets were owned by the state,” Rajapaksa said. “They were given to the private sector with the intention of putting them into more productive use in the interest of the national economy.

The firms had received state land grants or tax concessions. The firms