Japan Supports Socio Economic Development
[Tuesday, March 13, 2007 - 06.45 GMT]     

Japan is providing assistance to Sri Lanka for economic structure reforms, mitigation of balance of payment difficulties, and to procure agricultural machinery and equipment to promote rural development and poverty reduction.  

An Exchange of Letters for this aid from Japan was recently signed between the Governments of Japan and Sri Lanka. This is part of Japan's continued assistance to Sri Lanka, with focus on socio economic development, emphasizing development activities in the rural sector. The promotion of rural development and poverty reduction gets priority in the allocation of this Grant Aid.

A statement issued by the Japanese Embassy in Colombo said: 

The Government of Japan has provided a grant of Japanese yen 1,530 million (approximately Rs. 1,380 million) for two projects aiming at socio economic
development of the country. Out of this total amount, Japanese yen 1,200 million was provided under the "Non-Project Grant Aid" Programme (NPGA) and the balance sum of Japanese yen 330 million was extended under the scheme of "Grant Assistance for Under Privileged Farmers". 

The grant provided under the "Non-Project Grant Aid" is for the purpose of facilitating the sustainable economic development initiatives of the Government of Sri Lanka. This grant will be utilized for economic structure reforms, mitigation of balance of payment difficulties as well as for poverty reduction through rural development projects mutually agreed between the two governments. The grant will also be used to import goods and materials necessary for further promotion of projects implemented under the grant. 

This is the third occasion that a grant has been offered under this programme to Sri Lanka since 2004. In addition, another special grant under the same scheme was extended following the Tsunami disaster, for relief,
rehabilitation and reconstruction efforts in affected areas in the country. 

Grant Aid Scheme

The second grant was extended under Japan's "Grant Assistance for Under-privileged Farmers" formally known as 2KR for Increase of Food Production. The Government of Japan established the 2KR scheme in 1977, and in the same year, extended this grant to Sri Lanka. So far, the Government of Japan has provided more than 44.8 billion yen (approximately 41 billion
rupees) under this grant aid scheme to purchase essential agricultural machinery, equipment and fertilizer. 

This year the grant funds will be utilized to procure
agricultural machinery and equipment to promote rural development and poverty reduction. These machinery and equipment will be distributed to Agrarian Service Centers throughout the country to be made available for under - privileged farmers to carry out their farming activities.

Half of the value of these goods imported under both grants will be deposited in two separate special accounts and will be utilized to finance socio-economic development projects in order to achieve well-balanced economic growth as mutually agreed upon between the two countries and with mutual consent of the two countries. 

The Exchange of Letters for the provision of these two grants were signed by Mr. Kiyoshi Araki, Ambassador of Japan and Dr. P.B. Jayasundera, Secretary, Ministry of Finance and Planning.

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Last Updated Date: March 13, 2007 - 06.45 GMT