The Hon. K.V. Samantha Viddyarathna - Minister of Plantation and Community Infrastructure

¶ 01 Hon. Deputy Speaker, thank you for the opportunity. We are debating the Resolution under Section 235 of the Customs Ordinance to impose import duties.

¶ 02 As the Deputy Minister of Finance and Fiscal Management explained, this is one step in the new Government’s economic management. When we took office, the economy was in severe distress. The previous period saw not just restrictions but a complete halt on vehicle imports. Even essential items were difficult to import due to foreign reserve constraints.

¶ 03 The Opposition says the duty is too high, that growth is weak, and that management is poor. Looking objectively, halting vehicle imports had considerable negative impacts: on public transport, on tourism and industry, and on economic activity. Our decisions now are calibrated to the reserve position and macro stability. We have reopened in phases: first for public passenger transport (orders placed, LCs opened, vehicles arriving), then for business and tourism needs. There is strong demand, and vehicles are now entering the market.

¶ 04 However, imports must be aligned with available reserves. If we cut rates too low, a surge would deplete reserves, force other import restrictions, and fuel inflation—then the same Opposition would accuse us of mismanagement. With prudent management, we have stabilized other import streams (including fuel) and allowed space for vehicle imports.

¶ 05 The President’s Budget showed the highest capital expenditure in decades: about Rs. 1,400 billion. Government is leading investment, especially in agriculture, SMEs and business. We expect solid growth in 2025. This is a planned path, not ad hoc. Political stability has also improved, as shown in the recent local authority elections, supporting economic and social stability.

¶ 06 At those elections, out of 339 local authorities, the National People’s Power (NPP) won 267 and secured the largest number of seats overall. In 120 of those, we have clear majorities; in a further 32, power is evenly balanced but can be formed under the law; and we have confirmed majorities in another 115 bodies. This strengthens governance capacity at ground level.

¶ 07 We increased the basic customs duty on certain vehicle imports from 20% to 30% with a 50% surcharge to protect reserves and meet IMF-aligned revenue targets. As the economy strengthens, we will consider easing. Our decisions are based on data and macro needs, not personal preferences. The economy is reviving; we will continue targeted relief to the poor, have raised public sector salaries, and provided some tax reliefs to industry and business. We will proceed, despite Opposition wishing for failure. Thank you.