ECONOMIC & SOCIAL INFRASTRUCTURE

Economic and social infrastructure development is essential for creating new avenues for investment, improving accessibility across regions and opening new markets, The strategy adopted by Sri Lanka for economic and social infrastructure development was focused on generating sustainable economic growth. In 2007 the government of Sri Lanka focused on improving the following areas to enhance the level of Economic and Social Infrastructure.

Communication Services

The growth momentum in the telecommunications sector continued in 2007, largely supported by a further expansion in the coverage, introduction of advance technology and value added services, increased competition and affordability, and higher investments. Several new telecommunications projects were implemented in 2007 to improve the capacity, technology, coverage and efficiency of the services.

Electricity

Electricity generation increased by 4.5% to 9,814 GW during the year. In order to make the electricity a cheap commodity to foster economic growth the government of Sri Lanka made special changes to the electricity tariff in 2007 especially by removing the Value Added Tax (VAT) of 15% on electricity consumption.

Transportation

The transportation system of Sri Lanka is dominated by road transport, which accounts for about 85% of the passenger miles by all modes of public transport. Government’s plan has been to improve accessibility to the whole areas of the country through an efficient and convenient transportation system.

• Road Transportation

The government has given priority to develop national and rural roads in its infrastructure development agenda and several road development projects were continued in 2007, this included proposing seventeen flyovers to be constructed to avoid traffic congestion in the city of Colombo and its suburbs. Also the government took the initiative to develop rural roads under “Mage Neguma” programme in 2007 which initiated 6,190 projects.

• Railway Transportation

The passenger transportation increased by 4.5%, while goods transportation increased by 6.3% in 2007. The government in 2007 imported 15 diesel multiple units and 100 carriages to improve the railway transportation.

• Civil Aviation

A total of 5 million air passengers were served at the Bandaranaike International Airport (BIA) in 2007. This reflected a 4% increase over the number of passengers in 2006. The government took several steps to further develop the civil aviation sector in the country specially by introducing Mihin Lanka (Pvt) Ltd., a budget airline fully owned by the government to uplift the Civil Aviation sector of Sri Lanka.

• Ports Services

Port services showed a significant growth in 2007. The total cargo handling recorded a 9% growth in 2007 compared to 2006. The government emphasized on the construction of the Colombo Port Expansion Project (CPEP) to increase the container handling capacity. Further regional port development projects were initiated in 2007.

Water Supply and Irrigation

A separate ministry for water supply and drainage was formed in 2007 with a total budgetary allocation of Rs.27,330 million for 2007. Several water supply projects were implemented during 2007 to improve the capacity, quality and water distribution.

Education

Sri Lanka has been ranked high on the achievements in education in terms of high literacy rate, high levels of primary school enrolment as well as gender parity in access to education and achievements, when compared to other countries in the region.