Govt. to borrow Rs.2 trillion to service debt
The Government plans to borrow Rs.1, 944 billion from local and foreign sources for its debt servicing including the financing of the budget deficit in 2019, a senior Finance Ministry official said.
The Treasury has received an income of Rs 894 billion in the first six months this year. However, Rs 1,100 billion had to be paid as debt service; he added pointing out that there is a shortfall of Rs. 206 billion even after the debt and interest are paid off.
Sri Lanka, with a persistent current account deficit of the balance of payments, has had to rely on external borrowings to build up foreign reserves and internal borrowings to service local debts, a senior Central Bank official said.
The Government has allocated Rs. 2,057 billion for debt servicing in 2019, he said.
Fiscal operations of the Government moderated during the first four months of 2019 amidst the Government’s efforts towards a revenue-based fiscal consolidation.
Government expenditure was Rs. 962 billion during January-April 2019, an increase of 10.1 per cent compared to the same period of 2018.
The utilisation of Government borrowings for the period from January 1 to April 30 was recorded as Rs. 944.2 billion.
Approximately 46 per cent of domestic borrowing consisted of short-term borrowing in the first four months of 2019.