Sri Lanka Announces 1$ Billion Relief Package to Ease Economic and Food Crisis 

04-01-2022 

Judit Kolbe 

Sri Lanka and Human Rights Researcher, 

Global Human Rights Defence. 

On the 3rd of January, 2022, the Sri Lankan Finance Minister, Basil Rajapaksa, revealed the government's new economic relief package consisting of 229 billion Rupees, equivalent to 1 billion US Dollars (Daily Mirror, 2022; Sirimanne, A., 2022). The package is to be included within Sri Lanka’s 2022 budget and new taxes or a raise in existing taxes is not to be expected (Sirimanne, A., 2022; Economy Next, 2022). The relief package will raise civil servants salaries and pensions by 5,000 rupees a month, remove current taxes on food and medicines, give 1,000 rupees to Samurdhi beneficiaries [1] and ‘special stimulus payment for home gardens’ (Daily Mirror, 2022). The relief will cover around 2 million people who are currently on income support (Sirimanne, A., 2022). Additionally, there will be agricultural subsidies, depending on how much land a person owns, and how much crop was lost due to the fertiliser ban enacted by the Sri Lankan government in 2021 (Economy Next, 2022). The Finance Minister expressed that the government ‘encourage[s] the people to grow food crops in their home gardens in order to avoid a scarcity of food’ (Daily Mirror, 2022).

The main opposition in government criticised the package for omitting domestic inflation, which has increased to 12.1% in December 2021, fearing a further increase in inflation (Sirimanne, A., 2022).

Notes:

[1] The Samurdhi (or Prosperity) Programme is a governmental welfare programme, aimed at reducing poverty in Sri Lanka (Centre for Public Impact, 2017).

Sources and further reading:

Centre for Public Impact (CPI) (2017, May 30). The Samurdhi Programme in Sri Lanka. CPI. https://www.centreforpublicimpact.org/case-study/samurdhi-programme-sri-lanka 

Daily Mirror (2022, January 03). A Rs 229 billion economic relief package announced. Daily Mirror. https://www.dailymirror.lk/breaking_news/A-Rs-229-billion-economic-relief-package-announced/108-228237

Economy Next (2022, January 03). Sri Lanka to raise state salaries, pensions, agricultural subsidies. Economy Next. https://economynext.com/sri-lanka-to-raise-state-salaries-pensions-agriculture-subsidies-89268/

Sirimanne, A. (2022, December 03). Sri Lanka Unveils $1 Billion Relief Package as Food Prices Surge. Bloomberg. https://www.bloomberg.com/news/articles/2022-01-03/sri-lanka-unveils-1-billion-relief-package-as-food-prices-surge