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Lanka to launch urgent reforms to address fiscal challenges

(PTI) Cash-strapped Sri Lanka will have to undertake serious fiscal reforms to revive the ailing economy as it has identified a huge gap between the state’s revenue and expenditure, a senior official said on Friday.Addressing a seminar, Secretary to the Treasury Mahinda Siriwardena said, “We have an average monthly income of 145 billion rupees where the monthly expenditure amounts to 157 billion.”
He said the monthly state pay bill was 93 billion with another 27 billion for pensions. With the cost of the poor relief, social welfare costs, and capital expenditure of 11 billion there would be a revenue shortfall.
“We are made to borrow to finance the gap. This is why fiscal reforms were needed to bring down expenditure and raise revenue”, Siriwardena stressed.
The government has been facing opposition to its anticipated tax reforms which would see drastic rises in personal income taxes from employment.All salaries exceeding 100,000 per month are to be taxed at higher bands.
“These tax proposals with direct taxation would only affect 10 per cent of the population. We appeal to them to help the rest of the 90 per cent to live”, Ranjith Siyambalapitiya the state minister of finance had said.
The opposition and professional groups have already raised objections to tax hikes.Trade unions have vowed to lead public protests against tax reforms.
Sri Lanka is going through its worst economic crisis since its independence in 1948, triggered by a severe paucity of foreign exchange reserves.The government in May appointed international legal and debt advisors for debt restructuring after the country declared its international debt default in mid-April this year for the first time in history.
Sri Lanka is nearly bankrupt and has suspended repaying its USD 51 billion foreign debt, of which it must repay USD 28 billion by 2027.The cash-strapped country is now trying to secure a USD 2.9 billion bridge loan from the International Monetary Fund (IMF), and looking at financial assurances from its major creditors — China, Japan, and India — which is requisite for the island nation to get the bailout package.
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Japanese Minister of Defense pays courtesy call on PM

Gen. Nakatani, Minister of Defense of Japan paid a courtesy call on Prime Minister Dr. Harini Amarasuriya, at Temple Trees today [May 4].
The discussion took place in the spirit of long-standing bilateral friendship and focused on strengthening cooperation between Japan and Sri Lanka, particularly in the areas of defense and regional security. Minister Nakatani extended his congratulations to the Prime Minister on behalf of the Government of Japan and reaffirmed Japan’s commitment to collaborative efforts in ensuring peace and stability across the Indo-Pacific region.
He also emphasized Sri Lanka’s strategic importance in maritime security and regional connectivity.
Prime Minister Amarasuriya expressed appreciation for Japan’s continued support through development partnerships, especially via the Japan International Cooperation Agency (JICA). She reiterated the government’s commitment to transparency, economic reform, and national transformation.
The Prime Minister also shared the government’s vision for evolving the role of Sri Lanka’s security forces to include responsibilities such as climate response, humanitarian assistance, and maritime protection. The meeting further explored opportunities in trade, investment, and tourism, with both parties agreeing to deepen engagement across five key sectors.
The Ambassador of Japan to Sri Lanka, and senior officials from both governments participated in the meeting.
[Prime Minister’s Media Division]
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President Anura Kumara Disanayake departs for Vietnam

President Anura Kumara Disanayake departed for Vietnam.
The visit is taking place at the invitation of the President of Vietnam from May 4 to 6, 2025.
During the visit, President Disanayake is scheduled to hold bilateral discussions with both the President and the Prime Minister of Vietnam. He will also meet with the General Secretary of the Communist Party of Vietnam and other senior officials.
On May 6, the President will attend the official opening ceremony of the United Nations Vesak Day celebrations in Ho Chi Minh City as the Chief guest and will also deliver the keynote address.
In addition, the visit is expected to include the signing of several bilateral agreements and engagement with the Vietnamese business community to further enhance economic cooperation between the two countries.
Minister of Foreign Affairs, Foreign Employment and Tourism, Vijitha Herath, along with a delegation of senior government officials, is accompanying the President on this important visit.
[PMD]
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The Heat index is likely to increase up to ‘Caution level’ at some places in Eastern, Northern, North-central and North-western provinces and in Monaragala and Hambantota districts.

Warm Weather Advisory
Issued by the Natural Hazards Early Warning Centre of the Department of Meteorology at 3.30 p.m. 03 May 2025, valid for 04 May 2025.
The public re warned that the Heat index, the temperature felt on human body is likely to increase up to ‘Caution level’ at some places in Eastern, Northern, North-central and North-western provinces and in Monaragala and Hambantota districts.
The Heat Index Forecast is calculated by using relative humidity and maximum temperature and this is the condition that is felt on your body. This is not the forecast of maximum temperature. It is generated by the Department of Meteorology for the next day period and prepared by using global numerical weather prediction model data.
Effect of the heat index on human body is mentioned in the above table and it is prepared on the advice of the Ministry of Health and Indigenous Medical Services.
ACTION REQUIRED
Job sites: Stay hydrated and takes breaks in the shade as often as possible.
Indoors: Check up on the elderly and the sick.
Vehicles: Never leave children unattended.
Outdoors: Limit strenuous outdoor activities, find shade and stay hydrated.
Dress: Wear lightweight and white or light-colored clothing.
Note:
In addition, please refer to advisories issued by the Disaster Preparedness & Response Division, Ministry of Health in this regard as well. For further clarifications please contact 011-7446491.
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