SriLankan eyes routes to Nairobi, Addis Ababa and Johannesburg, Treasury silent on new Mihin aircraft

Sri Lanka’s 2015 Budget is one of mixed sorts – handouts, concessions, confusing numbers, proposals not matching allocations and furthermore, this week, for the first time ever, the projected expenditure was adjusted during the budget debate.

On Wednesday, in a surprise move the government altered nearly 1/3rd of the 2015 budget expenditure (as proposed by President Mahinda Rajapaksa) both in the Appropriation Bill presented on September 26 and the Budget on October 24.

Under this, of the 77 proposals/allocations, changes were made to 27 proposals/allocations when Prime Minister D.M. Jayaratne presented an amendment, increasing expenditure to Rs. 2.168 trillion from the estimate of Rs. 1.812 trillion, up by Rs 356 billion. The supplementary estimate presented to parliament has also increased the government’s borrowing to Rs. 440 billion.

Official sources said this is the first time in recent budget history that a supplemen-

The prices of the vehicles in stock, other than trucks (commercial vehicles) in the category of 5000-20000 gross vehicle weight (GVW), will come down by between 2 to 10 per cent due to Excise Special Provision tax presented in the 2015 budget, President of the Ceylon Motor Traders' Association, Gihan Pilapitiya told the Business Times.

A 1000cc Indian or Chinese made car would drop by Rs.300,000 and approximately Rs. 75,000-Rs. 100,000 for Japanese and Malaysian cars, he said after consultation with senior government officials.

The imposition of VAT and NBT has now been clarified and the buyers will not have to pay VAT as the VAT at the import and the selling point has been removed, he said adding that this will also apply to vehicle leasing as well.

The gazette notification pertaining to Excise Special Provision tax on motor vehicle imports will tary estimate was moved in parliament to amend the budgetary allocation in less than two weeks after the budget had been presented in parliament.

United National Party (UNP) MP Dr. Harsha de Silva told parliament that a government that boosted about its magical budget has now presented the actual figures secretly through an amendment. “We continuously asked the government to show the increased income as they claim had happened. But there was no answer to that,” he said, adding that it was extremely suspicious that the government is trying to increase the budgetary allocations within a lapse of less than two weeks of the budget being presented to the House. Separately he told the Business Times that it is more than surprising, that the government has raised defence and urban development spending to Rs. 291 billion from the 2014 figure of Rs. 253 billion, five years since ending the war in the North East in 2009. It is essential to find the ulterior motive behind this move, he emphasised.

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SriLankan Airlines is gearing to go to Africa; initially to Nairobi in Kenya, Addis Ababa in Ethiopia and Johannesburg in South Africa, in a bid to leverage on Chinese transit passengers via Colombo, officials said.

“We’re looking to go to these places in Africa primarily to support the Chinese transit passengers there,” Kapila Chandrasena, CEO SriLankan told the Business Times on the sidelines of the launch of its new wide body A330-300 aircraft last week. He said currently the national carrier is doing the analysis and modelling on routes to Africa. “We’ll be taking a decision on this by next winter,” he said.

He said the national carrier will expand to the broader Asian region and that December will see them fly to Kunming, capital of Yunnan Province, China while Melbourne is on the cards. According to the IATA (International Air Transport Association), the highest growth in the air transport will be centered mainly on the Asia Pacific region, fuelled by India and China. "This is why we aim our future expansions in the Asian region,” Mr. Chandrasena said, reiterating that this move will fetch critical mass into the airline.

Meanwhile other officials said budget airline Mihin Lanka is negotiating with three organisations to lease two Boeing aircraft and has written to the Treasury requesting for funds. "We haven't still got any feedback," a Mihin source said. He said that the airline is expecting some news in this regard as the lease agreement of the current fleet of three ends in early next year.