The Cordial Relationships We want Between the Tamil and Sinhalese People have not been Built
By Dr.Harsha de Silva
Mr. Speaker,
I am glad that important Ministers and Members from the Government side have come to listen to this speech. I must first state that I am happy to have been able to join the Budget Debate. I thank all concerned for giving me the opportunity. I intend to subject the Budget presented by the President on Monday to constructive criticism. Mr. Speaker, I want to be constructively critical. I consider it my duty as a Member of the Opposition. Therefore I expect that you will cooperate by not shouting too much.
In fact, all heads of state meant to enhance the living standards of the people of this country. Be it the father of the nation, be it President J.R. Jayawardene, or H.E. Mahinda Rajapaksa, they all attempted and are attempting to do exactly that. However the problem was that the economic models, economic policies they used were varied. Because of these differences, the country progressed under some leaders and collapsed under others. We remember that when we were schooling, we had to remain in the canteen queue in order to get shirt material. We received a piece of kerosene-smelling white shirt material and piece of blue short material.
Actually we witnessed that there was a situation where people did not have enough to eat. Some ate out of dustbins. However, today the situation has changed. I accept that nobody has died of starvation after 1977 in Sri Lanka. True, some incidents have occurred; we have heard stories of children being thrown into rivers. But taken as a whole, the period of people dying without anything to eat has ended. Mr. Speaker, as I think the main reason for it is the continuation of the economic policy begun in 1977. Whichever head of state made only superficial changes. The Budget presented by H.E. President on Monday also carries forth the same policy.
We are happy about it. Mr. Speaker, we are happy that His Excellency the President is not wavering. He is sticking to the policies that were introduced in 1977 by Mr. J.R. Jayawardene and continuing with that same process. We are today at a much different place from that of 1977. Many tried to end the war that prevailed for 26 years. However, President Mahinda Rajapakse has been able to finish it off. Gen. Sarath Fonseka and all others contributed to it. We wish to express our gratitude to all of them on behalf of the United National Party.
Now we have arrived at an important crossroads. Everybody calls it a golden opportunity. I also call it a golden opportunity. Therefore we have to discuss this Budget not only as a budget but also the overall economic policy within which it has been presented. We should first of all examine its background. We say that we want to build a national economy, and cultivate and build up the country. These are good. I am not contradicting it. However we have to be realistic. Globalization is here to stay.
Whoever says whatever thing, that America collapsed, that Australia collapsed; there is no way that globalization can collapse. In fact, it is for small countries like ours that the globalized economy is even more important, Mr. Speaker. We do not have domestic demand like India and Australia. We have only 20 million people. Therefore, we will not be able to achieve the development in life which we need if we fail to link our country’s economic process to the global economic process. Having said that we must examine what has happened to the global economy.
Mr. Speaker, I have today’s ‘The Economist’ magazine in my hand. What does ‘The Economist’ show? The Mahinda Chinthana Vision for the Future commences with what ‘The Economist’ says about Sri Lanka. Therefore, I think that you will accept what it contains is the truth. There are many stories here. It mentions the problems in America, China and Europe and talks about the fall of Ireland. We know that the recession is now over. To a great extent, the economic crisis is now over. But the recovery has not been concreted yet.
Hence what needs highlighting is that the world economic growth has not been established strongly. That is one aspect. That is the global aspect. We should look at what happens to the world. So, when the world develops, if we can fix the plug to the world, we can develop. We remember people talk about the plug. Those people are now on that side. They said they needed to remove the plug. That cannot be done. That is not realistic. We should fix the plug. If by fixing the plug, we get energy, we should get that energy to develop our country. That is the first matter.
The second matter is the post-war environment prevailing in our country. Despite what is being said, we all know that the cordial relationships that we want between Tamil people and the Sinhalese people have not yet been built. I am not saying that the Government is not making an effort to provide relief to the people in the North and the East. But there are questions concerning whether the amount of relief provided is enough or not.
The people who have come back from the North as of even last week told me that there is a deep sense of disappointment among people in Jaffna about the Government. –
Hon. Al Haj A.H.M. Azwer: Absolutely not!
Hon. Dr. Harsha de Silva
- and they do not feel, Sir, that what is due to them after the war has been given to them – [Interruption] I am not saying that it can be done in one week or month but I think, the Government should be taking measures to ensure that the people in the North do not feel like that. They must feel comfortable with the Government. – [Interruption] That is the background that we need to understand in this Budget and the economic policy. That is the second point.
The third point is this. We should consider what the people’s condition is. I do not intend to talk about the people in the North and East at this juncture. After the war they have problems unique to them. The Government should solve these problems.
Let us now see what the living condition of the people is. H.E. President has stated this on page 3 of the Budget Speech. I must read it. It is important.
“I have a humble pride that I have been able to fulfill a broad task as the Minister of Finance during the last 5 years in order to carry our country ahead, reducing poverty to 7.6 percent as an emerging economy in Asia.”
We all want to eliminate poverty. We would be glad if His Excellency could have been able to reduce poverty within his tenure. However, I have a question. That is, when the poverty was measured at the end of year 2006/2007, the poverty was 15.2%. It was 5.4% in Colombo District. I will read out percentages for two, three districts. In Rathnapura District it was 26.6% and 33.2% in Monaragala District. Nuwara-Eliya District had a poverty of about 33.8%.
Hon. Sajin the Vaas Gunawardena
Hon. Member, what was the figure in Dambulla?
Hon. Dr. Harsha de Silva
There is no District called Dambulla, Hon. Member. There is no such District. Matale District had a poverty of 18.9%. [Interruption] During the period which is said to have experienced a reduction of poverty from 15.2% to 7.6%, inflation prevailed to a great extent. In 2007 the inflationary rate was 16%. In 2008 it was 22.6%. In 2008 the inflationary rate was 3.5%. In 2010 it was 6.8%. I checked where this figure 7.6 came from. Thereafter I searched for the official report. I searched in the Internet. I phoned the Department of Census and Statistics and asked whether there was such an official report. I talked to the Director of the Department of Census and Statistics yesterday and said “Sir please explain this to me. I want to know if poverty has reduced by 50%, because as a person who studies economics, and as a person who has been watching this economy for years, I do not see how it happened”. Then he says:
Hon. Lakshman Senevirathna
You are referring to the statistics by the United National Party….
The Director said “this has been submitted in a Preliminary Report. Every 3 or 4 years, a Household Income and Expenditure Survey is carried out. It subjects 25,000 families to study. However, this figure has been presented through an analysis on data obtained for 5,289 families during July, August and September 2009”. Mr. Speaker, I downloaded the document from the Internet. It has this:
“Main objectives of the survey
I To measure the levels and changes in living conditions of the people.
Ii To observe the consumption patterns.
Then I got this document and read it. Hence I have a question regarding this data. Mr. Speaker, this report itself contains what happened to the income of an average household during the period concerned. It says that the average real income of a household during the period 2006/2007 – for, this survey needed one year to undertake – was Rs.17,465. That is after the inflation. However, Mr. Speaker, it says that the average income of a household has fallen to Rs.17,023 by 2009. Mr. Speaker, what I do not understand here is that if the overall real income has fallen in this country, how poverty can fall by 50%. I have a big concern about it. Therefore, more inquiry is needed in this regard. For if there is a mistake, if our assumptions are wrong, if we think that the people are actually doing much better that they are, may be, we may not want to give them the subsidies or whatever benefits that they require. Isn’t that so? Mr. Speaker, if anybody thinks that someone is better off, they feel that “he does not need a relief”. That is why we argue at length. We do not need to give subsidies to anyone. We need to give subsidies only to the people who need subsidies. Therefore, what I’m saying is that here arises a concern. I think you will all trust what I’m saying. [Interruption] I will come to the rice ration card story.
Hon. Sajin de Vass Gunawardena
This Budget has been prepared based on what you said. [Interruption]
Hon. Dr. Harsha de Silva
Mr. Speaker, there is another story here on page 06. His Excellency the President and all in the Government side talk about this. This is on page 06. It says the per capita income has increased to 2,375 dollars United States. That means in rupee terms it is 266,000 rupees Mr. Speaker. In that case it is 22,166 rupees per month. However, Mr. Speaker, this is the official report. It has a part styled “Per Capita Income”. It says this:
“Per capita income indicates the average living standard of a country or an area. In 2009 the per capita income in Sri Lanka was Rs. 8,931 per month”.
Rs. 8,931 is a figure much below Rs. 22,166. Now I accept that when countries are compared, we use per capita GDP. Ours is 2,000 dollars. In India say it is 1,300 dollars. China may have yet another figure. And in America say 50,000 dollars. It is good when a comparison is done between countries. However, when we calculate our income within our country, the correct thing is not to divide the Gross Domestic Product by the number of people. The correct method is to check the income of a family. For there are people who make hefty profits in the stock market. There are millions and millions in bank profits. These all are reflected when the GDP is divided by the population. Then we ….
Hon. Basil Rohan Rajapaksa – Minister of Economic development
Those are the international data ….
Hon. Dr. Harsha de Silva
Hon. Minister, that is what I said. That method is correct when we compare different countries. [Interruption] No, No. As I can see it, it is not a comparison between countries that we need here. What I am doing is a constructive criticism. I am making some constructive Criticism.
Hon. Basil Rohan Rajapaksa –
Hon. Member, [Interruption] Said two things. He said one was eight thousand. The other one was some two hundred thousand. That is the difference. We calculate both. We on the one hand, check what the income is. On the other, everywhere in the world the Gross Domestic Product ….
Okay, then what I referred to as income was Rs. 8,931. That is what has been mentioned in the official report. However, the Budget states the income as Rs. 22,166. What I’m saying is there is a contradiction here. I do not need you to accept what I am saying. Neither do I need anything done about it. However, since I want to mention this I am mentioning. Next comes consumption. If poverty has now fallen, what has happened to the consumption? Mr. Speaker, it is actually disheartening to state that the consumption of rice, wheat flour, bread, lentils and sugar has all gone down. How could it have happened? If the living conditions of the people have increased, and poverty has halved, why don’t these people eat? We have to look into it.
Hon. Basil Rohan Rajapaksa
State the other things also. How about vegetables? The amount of vegetables consumed has doubled.
Hon. Dr. Harsha de Silva
Hon. Minister, I will tell you. It is like this. Hon. Minister, I am not a Member or a Minister of the Government. I do not have access to everything. Hon. Minister, I have only access to public documents. So I am quoting from Table 8: Per capita consumption of selected food items per month – 2006/07 of that official document. In that official document the consumption of -
Hon. Basil Rohan Rajapaksa
Hon. Member, that is meaning of what is called nationalist economy. We have acted so that the appetite for local products increases.
Hon. Dr. Harsha de Silva
No, Hon. Minister. Now it is called local. Samba rice is local. So is Nadu. Raw rice is local. They are local and we do not import them. There consumption has reduced.
Hon. Basil Rohan Rajapaksa
No, the consumption of white Samba has increased. Please check.
Hon. Dr. Harsha de Silva
When these three are added, we would sometimes eat Samba rice. I do not know, at home we sometimes eat raw rice. That is how it is. We are talking about rice consumption. [Interruption] Okay, it is not such a big thing. It has decreased by only a small amount, I accept. It has decreased only by an amount like a gramme. That is not what I’m driving at. My argument is: I expected this to have increased. However, it has not increased. That is where the argument lies Hon. Minister. I think the reality about the people is reflected there. The people do not know of these fairy tales, Mr. Speaker. They don’t! I wonder whether the officials have given false data. The other day a real problem occurred. [Interruption]
Hon. Sajin de Vass Gunawardena
Who gives it? Who gave them 10 years ago?
Mr. Speaker,”
Listen, please.
Hon. Dr. Harsha de Silva:
No, I will explain it. [Interruptions] I have operated the project styled “Govi Gnana Seva” which I have personally financed for about 6 or 8 years. I have spent more than four million for it. [Interruptions]
Hon. Sajin de Vass Gunawardena:
Now you are lying, aren’t you? That’s the thing.
Hon. Dr. Harsha de Silva:
Please stand up to say “Thank You” for it. [Interruptions] Say “Thank You”. Don’t attack everything. That is a contribution that I have made with my own money. So you should appreciate it, my good friends.
Mr. Speaker:
Listen.
Hon. Sajin de Vass Gunawardena:
That is because your pockets are being filled. Then, that is yours. Speak the truth in this House.
Hon. Dr. Harsha de Silva:
Mr. Speaker, the deputy Prime Minister of Singapore gets up and says Sri Lanka has the fastest growth rate after China. [Interruptions] After China, the development pace is …. [Interruptions] Hon. Minister, this is public relations; have some public relations with this. .. [Interruption].
Mr. Speaker:
Do not disturb. Sit down.
Hon. (Dr.) Mervyn Silva:
You are my honourable relation.
Hon. Dr. Harsha de Silva:
China’s growth rate is 9.6%. Sri Lanka does not have as much. However, India’s is 8.8%. Singapore is 10.3%. 9.8% in Malaysia. 9.8% in Taiwan and 9.1% in Thailand.
It would be good if Sri Lanka’s were higher. However, frankly speaking, Sri Lanka’s is not higher than that. What I am going to say is that there is a problem about these data.
Hon. Basil Rohana Rajapksa:
The calculation has been made by allowing for inflation. Do not compare it with the inflation.
Hon. Dr. Harsha de Silva:
No, no, this is without inflation, Hon. Minister, this is without inflation.
I vouch for that. This is without inflation. This is real growth. What I am saying is Singapore and other countries are growing faster than Sri Lanka. Sri Lanka is not the second fastest growing economy in Asia. That is my point. Why I am saying this is that it is material very much, it is material in the context that the credibility of the data that is being given to us. Therefore, this is marketing ….
Hon. Lakshman Seneviratne:
Hon. Member, can I ask a question?
Hon. Dr. Harsha de Silva:
Ask, Hon. Minister.
Hon. Lakshman Seneviratne:
You are telling that what the Deputy Prime Minister has said because you cannot digest it. You would accept it if it was said in some other way.
Hon. Dr. Harsha de Silva:
Okay, thank you.
Hon. Lakshman Seneviratne:
Is that the argument? Give me an answer.
Hon. Dr. Harsha de Silva:
I will, I will. You are not saying the same thing that you said with us. [Interruptions] Not necessary. Later. Let me speak during the time allocated for me.
Mr. Speaker:
Okay. Let the Hon. Member speak.
Hon. Dr. Harsha de Silva:
There is only a short time left. [Interruptions] Hon. Member, let us talk in the Lobby outside. [Interruptions]. These are marketing propaganda. I saw on television an advert on a T-shirt being broadcast. [Interruptions] When the youth goes out in that T-shirt, girls come running. Girls come toppling and tramping him. Then some get foxed to believe that they will also experience it and they buy these T-shirts. However, not many will experience it. Hence what I am trying to say is that a marketing gimmick is being played with regard to the data. The data that are produced are not true ones. When such data are presented, they create a dreamland. However, reality is not that dreamland. In fact, I have in my possession the Auditor …
An Hon. Member:
Auditor General
Hon. Dr. Harsha de Silva:
Yes, that report. [Interruptions] The one that was presented on 01 July 2010. There is a fantastic story about marketing consultants in the Central Bank. This has the fact that a sum of 18,139,642 rupees was spent to pay a public relations company for presenting to the world positive economic data to the world. They are said to have undertaken to publish six articles in first-grade magazines and have interviews with Minister and senior officials to be broadcast over television channels. However this has not been fulfilled. It was just one interview secured for one person that has materialized. 18.6 million has been paid to perform this marketing gimmick.
It has been queried in this Report of the Attorney General. What I’m trying to say is that not everyone can be cheated by giving statistics.
Some get deceived but some don’t. So this is deceit. Why am I presenting this argument? For this is the first phase. Forgive me for saying this. I am not saying that this was something done purposefully. This may have happened because of the errors in the data. If people live well, if poverty has decreased, why should there be relief for people. Let us take into account the statement that the poverty level is 7.6%. Mr. Speaker, I looked yesterday for the poverty level for America. 14.3%. What is it for Canada? 10.2%. How much is it in Britain? 14%. How about South Korea? 15%. Are we trying to say that Sri Lanka has developed more than all these countries? What is the meaning of this? [Interruptions]
Hon. Basil Rohana Rajapksa:
Sri Lanka has developed. That is for sure.
Hon. Dr. Harsha de Silva:
Mr. Speaker, I have a conflict here. I see a contradiction here. That is why I can’t believe it. [Interruptions] If I had been told that the poverty level was 14 or 15 percent, it would have been all right. There is that problem. It was also mentioned that the poverty had gone down in a period when incomes had doubled and that the per capita income doubled from 1,200 to 2,400 US dollars, and that the poverty was halved. In that case Mr. Speaker, we have already performed the miracle. Now the wonder of Asia has materialized. Now Sri Lanka is the Wonder of the World. We must already be enjoying it, aren’t we? The problem is it is not just so. [Interruptions] If incomes have grown like this, there is no need to give 2,500 rupees. That is true! [Interruptions]
An Hon. Member:
That is why it is not given.
Hon. Dr. Harsha de Silva:
Yes, it may be the reason for not giving the 2,500 rupees. However, Dr. P.B. Jayasundara has made a nice statement yesterday. This statement has been published in the Lanka Business Online this morning. He has said at a seminar of the Chartered Institute:
“…. Could have given Rs.2500 or Rs.10,000.”
He has said it is not just 2500 rupees but 10,000 rupees could have been given. He has said “Who cares? Print and give this money.” He has made an important statement there. I respect him because he is an economist. He has made a true statement. For, we can increase salaries by printing money. But what happens when we print money and increase salaries? Inflation goes up. If inflation goes up, the whole population will suffer.
Hon. Basil Rohana Rajapksa:
Do you accept it?
Hon. Dr. Harsha de Silva:
I do! I speak the truth, don’t I, Hon. Minister? What we want is not to give pay hikes to give temporary relief to people in order to pacify them. However, [Interruptions]
Hon. Basil Rohana Rajapksa:
That is correct!
Hon. Dr. Harsha de Silva:
However, [Interruptions] However …. However! [Interruptions] Listen to the rest as well. However …. [Interruptions]
Hon. Sajin De Vass Gunawardena
That is it; it is not giving short term relief that has been done through this Budget.
Hon. Dr. Harsha de Silva:
There are two things. When the vote was requested, we were told that the Rs 2,500 would be given. Before taking the vote, didn't you ask Dr. P.B. Jayasundara: “Dr. P.B. Jayasundara, can we pay the 2,500-rupee pay hike?” The election was campaigned with him some time before. Did he say “Can, Sir”? Was it after that that the President said
”We will give 2,500? It could have been done that way, couldn’t it? That is the ethical thing.
Hon. (Dr.) Mervyn Silva:
This Dr. tells lies on and on.
Hon. Dr. Harsha de Silva:
The other thing is that the living condition of the people has come down.
Hon. (Dr.) Mervyn Silva:
I am obstructing to the speech.
Mr. Speaker
Do not disturb.
Hon. Dr. Harsha de Silva:
As people’s living conditions have come down, Mr. Speaker, we can logically show why a 10,000-rupee salary hike is necessary. When you apply it in the COLA equation, it is clearly reflected. Apart from that, this Rs.10,000 or 9,600 for that matter, is not something which fell from a tree. There is a theory behind it. There is a logic behind it. There is an equation behind it. Therefore it should be received by the people. The reason was this. Those days the inflation rate was at an apex.
Now the inflation has been reduced. It is also acknowledged. I must state that this is not an unfair request. [Interruptions] Now the rice ration card has been mentioned. Let us assume that Mr. President says that some people have low income; therefore we give them a rice ration book, lentils ration book, potato ration book, onion ration book, and we have allocated some money for the purpose. Let us also assume that the low-income people are Samurdhi beneficiaries.
I don’t know how it will be divided. Let us for argument’s sake say that it is the Samurdhi beneficiaries. Mr. Speaker, how much has been allocated for each month? Eight rupees. However, how much is the tax on canned salmon? 85 rupees. Salmon tax is 85 rupees. Eight rupees has been allocated for each rice ration card. Therefore I think that there is a contradiction there. That is not what should happen.
Mr. Speaker, what else has been done? Into the bargain, the public servants were also caught in a pay tax net when it comes to those earning more than 50,000 rupees. A PAYE tax of 4% will be levied on those earning more than 50,000 rupees. For, in order to get this 2500 rupees, one has to earn 50,000 rupees. A PAYE tax of 4% will be levied when one earns more than 50,000 rupees. The salary is increased by 5%. A tax of 4% is imposed. I think there is a big problem here.
Next matter is that IDD call charges have been increased. Many people are in Dubai. Taking calls will be a problem to them. Meanwhile a tax gimmick has been done. Someone or other said “We reduced the Nation Building Tax”.
He said that the Nation Building Tax has been reduced from 3% to 2%. Now let us go to the technical details and assess that statement.
Mr. Speaker, through the reduction of this tax, the Government is said to increase its revenue by 12 billion rupees. How could it happen if the Nation Building Tax has been reduced? That means the majority has to pay this tax. That majority means people, Mr. Speaker. Therefore it really is a gimmick that has been done here. Next they say that the telephone tariffs have been reduced. Although telephone rates have been reduced, a tax has been introduced on the bill. An additional sum of 15.5 billion rupees is expected to be extracted from people. The charges for entering the Peradeniya Botanical Gardens and the Zoo is said to have been increased.
I do not know the amounts exactly. But it has been stated that 4 billion rupees is going to be raised from it. So Mr. Speaker, that is why the people are blaming the Government. The people berate the Government for the dirty deed that was done through this Budget. [Interruptions] Why do they blame? The Government says that the people are living well. However people are living comfortably. Therefore, as people live in pressure and unhappily, they expected relief. As they did not get them they are fair to blame the Government.
Let us set it aside for a moment and talk about investors. For, this is a Budget that gave concessions to investors. The screaming headlines in all the newspapers, the trade chambers and all, carried what? "An investor-friendly Budget."
They said this is a Budget that the Government presented to encourage investors, aiming at development goals. The government said that the Budget will put forth a policy of increasing concessions which it had been offering for the past 1 ½ years following the war. The tax on profit was reduced.
Income tax was reduced. Even the taxes imposed on banks, which are been earning in billions, were reduced. What did the government expect? This is a fair expectation. What did the markets expect? The expected the Colombo Stock Exchange to zoom and go through the roof. The government expected it to pass 7000 points. As computers are permitted into the House, I have been able to see live what is happening to the Colombo Stock Exchange. [Interruptions] See what has happened now.
This is falling. Already a decline of 0.94 has occurred as of now. It fell on Monday. It fell on Tuesday. The Government tried desperately to prop it up. However, what I’m trying to draw at is this. The investors have not lapped this Budget up. There seems to be something terribly wrong in it.
Why is it not moving up? Because if the profits of firms go up it should reflect on their share prices. That is the theory. Anybody who has learnt economics or studied accountancy knows this. Now investors are also blaming. That investors are blaming does not mean that they come to streets and demonstrate. That means they manifest it in the stock market that they do not accept this. If the stock market accepted this Budget it would go up to 7,500 or 8,000 points. However, now it is in the process of decreasing.
Now it has fallen a little from the previous position. Now the reason for this is [Interruption] that the Government tells investors that it would grant concessions. However, on the other hand the Government recovers its tax losses by imposing other tax. Now consider the reduction of VAT on financial services. Next the income tax has been reduced. However, a new investment fund has been introduced and the Government says …. [Interruptions]
Mr. Speaker:
Listen and reply.
Hon. Dr. Harsha de Silva:
That the profits of banks be sent to that institution – i.e. Government. We all know what the Government does when it receives the money from the private sector. Therefore, even these firms are asking the government not to do it. I urge you Hon. Ministers to reconsider this because nobody wants that direction. [Interruptions]
Mr. Speaker,
Sit down. Sit and listen. Having listened, you can reply in turn.
[Interruptions]
Hon. Dr. Harsha de Silva:
O’ Doctor, please listen.
Hon. (Dr.) Mervyn Silva
As a representative of people, I insist to you that we cannot give way to such empty speeches of empty persons. [Interruptions]
Hon. Dr. Harsha de Silva:
Can we have some order please?
Mr. Speaker:
Now you are a Minister. Please sit down.
Hon. Dr. Harsha de Silva:
Thank you very much, Mr. Speaker. Now let us look at this. I accept that the Colombo Stock Exchange is not the best indicator to measure development. Let us now consider what has happened to Foreign Direct Investment. Mr. Speaker, what I am saying are important matters. What has happened t our Foreign Direct Investments? The 2010 Report has been presented the other day.
How much Foreign Direct Investment did we get for the first six months of 2010, in a full year of peace, Mr. Speaker? It is much less than what we got last year. In fact we got only US $ 208 million. Compare that, of course, for the full year with other countries. Pakistan has got 3,695 million US Dollars. Cambodia 5.3 billion. Laos 7.2 billion US dollars.
Vietnam 7 billion US dollars. When Vietnam is getting 7 billion US Dollars, how come we are only getting 200 million? Let us double it for the twelve months. That is still 400 million US Dollars. Let us say even 600 million US Dollars. That is one tenth of what Vietnam is getting. So, I urge you to honestly reconsider some of these policies. There is something wrong. I also love this country as much as they do, Mr. Speaker.
I do not have hatred towards anybody. I am talking from my heart. I am telling the truth. I am also a citizen of this country. My children are being brought up in this country. Therefore, I also want to develop the country. There is a problem. Look at what that problem is. Don’t say that there is no problem. If the car misses, don’t say that there is no problem in it because it can miss and stop. Don’t let that happen. Important investors will not come. It’s not all. They will dwindle. Look at what has happened to the apparel sector. The exports to the US and EU – [Interruptions]
Hon. Sajin De Vass Gunawardena
How many factories has he started? Ask him. [Interruptions]
Hon. Dr. Harsha de Silva:
Mr. Speaker, we know the amount of garments sent to the EU and America have decreased. It has gone down as against the previous year. It is not a lie. It is true. [Interruptions]
Those who remain are also chased away. Now consider the other big problem with regard to the hedging deal. I saw in the newspaper that Hon. Dinesh Gunawardena says he would not speak about it in detail because there is a lawsuit about it. I respect it. However, there is a problem there. For, a big investor had come and said “everything depends on the resolution to the hedging case.” I do not say that it is the only problem. However, when it happens, the investors’ trust in Sri Lanka will go down. Therefore, don’t let that happen. We were told that Mahindra and Mahindra would come.
Nokia would come. Who has come actually? I’m asking: who are the fortune 500 investors who have come to Sri Lanka? [Interruptions] Recently the Nokia people have gone to India and opened a factory. [Interruptions] At least the investors fetched by KP are nowhere to be seen. [Interruptions] I want to make another point that is important. Now we should consider this: we have to look at the Comprehensive Economic Partnership Agreement seriously. Hon. Sarath Amunugama, Hon. Sajith Premadasa and I went and met Indian Foreign Minister S.M. Krishna. He asked us what we thought about CEPA.
I don’t know if it is based on this that Hon. Amunugama has been stripped of his portfolio and been given a senior Minister post. However, you must look at these in a pragmatic way. It is true that some people are going to lose. But, as a whole we have to grab the opportunity that is going to be available in India. We have to do that. Merely because two three people say “Don’t do this Mr. President, this is not good”, it should be discussed broadly and see how it can accrue a benefit to the country, and its people. Don’t refrain from doing it thinking about the disadvantage caused to a few cronies.
The other matter is this. Who benefits from this economic policy? Who enjoys? Look at something right said on the Sunday Times of 21st November 2010. Shangrila has been promised lands in front of the Galle Face at 12 million American dollars per perch. We wonder if the statue of former Premier S.W.R.D. Bandaranaike’s will be removed from its place for this. However it has been promised that land will be given at 12 million. However, they are now reported to be saying the property of the Colombo Commercial Company located by the Beira Lake will be given at 7 million US dollars per acre to a person who went to the UN meeting in New York. Therefore, people are asking who this friend is. Who is this crony?
Mr. Speaker,
Hon. Member, you have only 2 more minutes.
Hon. Dr. Harsha de Silva:
Can I have five more minutes, please?
Mr. Speaker,
Yes.
They are asking who this bosom friend is. It is said that 31 persons requested this. It is said that the land is going to be given to them for a song without any tender procedure. The Secretary to the Treasury had said yesterday on the newspaper –
Hon. Al Haj A.H.M. Azwer:
Mr. Speaker, I rise to a Point of Order.
Mr. Speaker,
What is the Point of Order?
This Hon. Member is saying that it is the statue of Mr. Bandaranaike. That comment is very wrong. Even according to Buddhism it is wrong. It is not statue. It is the image. That is not all. The head of the Department of Census and Statistics is a female called Surajanie Vidyarathna.
Mr. Speaker:
All right. Sit down.
Hon. Dr. Harsha de Silva:
All right. I will correct myself. Thank you very much for the correction. Image, not statue. I withdraw that word. The Secretary to the Treasury says that the deal will be signed by next week. Where is transparency in any of these deals? That is what we ask. Then it is said that the sea will be filled to create 400 hectares of land
Mr. Speaker:
Hon. Lakshman Kiriella, please tell me from whose time this 5 minutes is to be reduced.
Hon. Lakshman Kiriella:
Reduce one minute each from all speakers of the opposition.
Hon. Dr. Harsha de Silva:
Thank you. It is said that 400 hectares will be reclaimed and sold all in a hurry. Where is a discussion or dialogue concerning this? Where is transparency? I don’t know whether it is this deal or some other deal that will be signed next week. However, it is reported this deal will be signed all of a sudden. Our Hon. Minister Lakshman Yapa Abeywardena has said that hereafter land deals will be concluded and signed in two weeks. This is where the problem lies. This is where we do not want this country to be taken. We support the economic reforms. We support the tax benefits to the investors. But we want them to be proper investors, but not just crony capitalists who come here. [Interruptions] Hon. Member sit down.
Mr. Speaker:
Allow him to speak.
Hon. Dr. Harsha de Silva:
Thank you. We passed a gaming Act. It is said that a Mr. Jhun Jhun Waala will be coming and opening casinos. Now look at how the rains which started after passing it is still continuing. The Parliament was also inundated once after its passage. Now today it is just six inches from the point of inundation. Even today it can flood. The point is, we want good investors, but not fly-by-night people or crony capitalists. Now there is a report which says “The rail track from Pallai to Kankesanthurai costs US Dollars 4 million a kilometer done by the Chinese. But the same line from Omanthai to Pallai costs only US Dollars 2 million a kilometer. I do not know the reasons for it. This is the problem we have. We want proper and good investors who want to bring their own money to invest, to bring the technology, bring the expertise and bring the management.
Only now the secret is coming to light. There is no place for respectable, renowned investors in this policy. It is the bosom friends who have the place. The marketing clique is saying that it is the aid given to us by the government of China. "This is aid from China". Why do these utter lies have to be told? We were given this book when the Budget was being read; the report on the Fiscal Management Responsibility Act. It says that China provided some funds for year 2010. But I cannot find it now. Some 500 million or so has been given. However, Mr. Speaker, not even five cents has been given as grants for the year 2010. What do they mean by aid? It is not aid, but a vast majority of it is commercial credit. So, commercial loans have been obtained. In the website it says that actually they are buyer’s credit but called "government-government credit for world projects". I am referring to their website and it also says that you as an agent can earn millions of US dollars as commission. This website says. This is lack of transparency that we do not want happening. We want transparency; we want tenders to be called; we want competition in these projects not be given just to various fly-by-night characters and crony capitalists.
Into the bargain, there are unnecessary expenses. How much was spent for IIFA! Now look at the idea that Commonwealth Games should be held in Sri Lanka. Who knows how much the Commonwealth Games held in India cost? For the first phase of the Mahinda Rajapaksa Harbour built in Hambantota –
Hon. Geethanjana Gunawardena
Sir, I rise to a Point of Order.
Mr. Speaker:
There is a Point of Order being raised.
Hon. Geethanjana Gunawardena
He misleads the House as well as the whole country by stating that the Chinese government has not given five cents. The Chinese government had given a grant each time a dignitary came here. Even last week, when the harbour was inaugurated, where you also participated, a grant was given. Before that, [Interruptions]…. Million was given. Please correct this. This is another contract. [Interruptions]
Hon. Dr. Harsha de Silva:
Mr. Speaker, my time is taken. [Interruptions] Here is the Government's Fiscal Management Report. Hon. Geethanjana Gunawardena, read it. Look at page 45 of Fiscal Management Report. This is the book we were given. Please turn to page 45 and see how much has been stated under Chinese grants. Mr. Speaker, not five cents has been given. Others have given. The Netherlands have given. Japan has given. Korea has given. Germany has given. However, China has not given. I am saying it with responsibility. If the data here are false, please state that they are false. Catch the official who has fed them. Here it is mentioned [Interruptions]
Hon. Geethanjana Gunawardena :
What are you talking about?
Hon. Dr. Harsha de Silva:
It is here in page 45.
Hon. Geethanjana Gunawardena :
No, it is not.
Hon. Dinesh Gunawardena:
Hon. Member, are you saying that China has not given a grant to our country?
Hon. Dr. Harsha de Silva:
For 2010.
Hon. Dinesh Gunawardena:
No, no. Please clarify the point you are stating.
Hon. Dr. Harsha de Silva:
That is what I was saying. For this year –
Hon. Dinesh Gunawardena:
Do you mean to say that China has not given a grant to our country?
Hon. Dr. Harsha de Silva:
No, no. That is not what I meant.
Hon. Dinesh Gunawardena:
Then what did you say?
Hon. Dr. Harsha de Silva:
Okay. I will tell you again. According to what is stated by the official report for this year, [Interruptions] what I am saying is what is said in the official document that your government gave us. Anybody can see. It is not a falsehood.
Hon. Dinesh Gunawardena:
Turn to the other page, not the one you referred to. Do you know the thing called Performance Arts Centre.
Hon. Dr. Harsha de Silva:
It is not in this year. [Interruptions] Yes, I accept that. It is a grant. I accept. That is not what I said. I said in 2010 – [Interruptions]
Let me finish. Please, sit down. The point is that according to the official report given to us and given to me as a Members of Parliament, China has not given even one cent in grants to Sri Lanka in 2010. it is according to the documents tabled in this Parliament on the day His Excellency the President presented the Budget. Hon. Minister, if that is wrong, please, deal with that. [Interruptions]
Mr. Speaker,:
Hon. Member, please, conclude your speech now.
Hon. Dr. Harsha de Silva:
I am going to wind up. Please give me one minute, Sir. So, Hon. Speaker, Hon. Members, what I was trying to say is that there is a problem in the economic policy. The Government seems to believe that the people are doing well and that they do not need any benefits; they do not need any subsidies; they do not need any salary increases, because, they believe that the poverty has dropped to half and that the income has doubled. But, Hon. Speaker, the reality is not that. The reality is far from it. Therefore, what I say is please, you need to reconsider this and provide relief to people; accept the reality and do the needful. I want to say that there is a sustainability problem in this model. We just cannot carry on like this with loans after loans. It is difficult to obtain loans in this fashion. There is a sustainability problem. The amount of debt service is higher than the amount of tax revenue in this year, in the last year, and in the year before last. So, think about it. I am trying to explain in the way I could as a constructive criticism of what is happening. So, I appreciate everybody’s attention. Thank you very much.
Mr. Speaker:
Thank You.
(ENGLISH TRANSLATION OF PARLIAMENT SPEECH by UNP National list MP Dr.Harsha de Silva ON THE BUDGET on 26 NOVEMBER 2010)
