Defence budget slashed
[February 20, 2002 - 10.30 GMT]

The government has proposed the slashing of defence expenditure by 20%.

Finance Minister K.N. Choksy told Parliament Tuesday, that a sum of Rs. 50 billion (US$ 537 million) had been allocated for defence expenditure, from this year’s approximately Rs. 300 billion (US$ 3.2 billion) budget. This is a reduction of Rs. 13 billion (US$ 138.88 million) from last year's allocation.

Special consideration has also been given to improve the education sector in the country, allocating Rs. 23 billion (US$ 250 million).

The proposals were made in the government’s Appropriation bill for the Financial Year 2002 tabled in Parliament.

The slashing of defence expenditure came amidst the Government’s efforts to enter into an MOU with the Liberation Tigers of Tamil Eelam [LTTE] to end the 18-year old ethnic conflict.

However, Minister G L Peiris speaking in Parliament said that the formal agreement on the truce was still under negotiation, and no finality had been reached. "As soon as the agreement is finalised the Prime Minister will make a comprehensive statement," he said.

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Last Updated Date: February 20, 2002  - 10.30 GMT.