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Sri Lanka plans to spend more and borrow further next year as expenses for defence and fuel related subsidies escalate. Total state spending will rise 30 percent to Rs.
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568.3 billion (US$ 5.6 billion) in 2006 from Rs. 438 billion budgeted for 2005, the government said Tuesday while tabling the budget appropriation bill for 2006 before parliament.
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Defence spending will go up 23 percent to Rs. 69.4 billion next year, above Rs. 56.6 billion budgeted for this year (Rs. 52 billion spent in 2004).
Overall borrowing programme will expand by Rs. 100 billion to Rs. 536 billion, as the government leans further on foreign debt, rupee loans and government bonds. The programme excludes Rs. 300 billion ceiling set for borrowings through treasury bills.
The appropriation bill does not include revenue estimates, but Finance Minister Sarath Amunugama will disclose the details in his November 8 budget.
Sri Lanka is hoping to contain its budget deficit to eight percent, Treasury Secretary P B Jayasundara