Sri Lanka 2022 budget appropriation bill initial observations: ICRA

ICRA-lanka-rating

Key takeaways

§  Decline in total expenditure is achieved at the expense of the capital spending

§  Capital heavy ministries take capex cuts while personnel heavy ministries get a boost for recurrent expenditure

§  Allocation of defense and security related SUs is strengthened

§  Overall health related allocation is increased by nearly LKR 7 Bn

§  Total expenditure allocation on education contracts by LKR 6 Bn

§  Increase in the organic fertilizer allocation is financed by reductions in the budgets of minor agri Ministries

§  Plantation related allocations fall below the norm

§  Trade spending to be on par with 2020 levels

§  Tourism receives the lowest allocation in five years

§  Number of grassroot level development interventions in 2022 may see a decline

§  Somewhat lower level of spending is expected on welfare and social development

§  Allocations for industries plummet, risks sector development

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