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7.4% Deficit By Nov.

Jan 21, 2011 2:25:05 PM - thesundayleader.lk

Government’s total expenditure vis-à-vis “total revenue deficit in the first 11 months of last year comprised Rs. 409.8 billion as compared with a deficit of Rs. 432.6 billion in the same period the previous year, a contraction of Rs. 22.8 billion (5.2%) year on year (YoY).
Central Bank of Sri Lanka (CBSL) Governor Ajith Nivard Cabraal speaking at a recent function said that the economy grew by 8% last year to US$ 50 billion. If the exchange rate is taken at Rs. 111 to the dollar, this would amount to a GDP of Rs. 5,550 billion.
This translates to 1% of GDP being equivalent to Rs. 55.5 billion. On that basis the total expenditure to revenue gap in the first 11 months of last year would amount to 7.4% in GDP terms. The Government has said that the budget deficit was on target to reach 8% last year, compared to a near 10% the previous year.
Meanwhile Government revenue and grants in the first 11 months of last year increased by 14.4% year on year (YoY) to Rs. 749.3 billion.
This comprised a tax component of Rs. 654.6 billion, a 16.7% YoY growth; a non tax component of Rs. 83 billion, a 1.4% YoY growth and a grants component of Rs. 11.7 billion, a 45.8% YoY contraction.
Expenditure and Lending minus repayments in the period under review grew by 6.6% YoY to Rs. 1,159.1 billion.
This comprised a current expenditure figure of Rs.  852.9 billion, a YoY increase of Rs. 25.8 billion (3.1%) and a capital and lending minus repayments figure of Rs. 306.2 billion, a YoY increase of Rs. 46 billion (17.7%)-CBSL