Sugath Kulatunga

Government plans to spend Rs 3.26 billion for a safety net called Aswesuma for 1.7 billion poor people. It is also a proposal by the IMF which is wearing the mask of pro poor to introduce harsh neo liberal policies. (it is noted the term Aswesuma- could stand for ඇස් වැසුම/As bandung -closing the eyes). We have had Janasaviya and Samudra for the last three decades and still we are not aware how many individuals have been removed from the Samurdhi scheme on their achieving self reliance. It is more a scheme to perpetuate poverty for political advantage. At the same time we have introduced a large cadre of officials to maintain the scheme.

Would it not be better if at least part of this colossal sum of money was used to create gainful employment by

         i) Directly supporting self employment projects and

         ii) Supporting the private sector to set up enterprises to employ Samurdhi qualifiers.

In both cases the government should provide the required technical and marketing services.

It is essential that the government make available Feasibility/project reports on viable investments. In the case of private sector sponsored investments the private party should be given incentives like tax relief.

Small and Medium Industries sector is considered the engine of economic development. There are many concessions accorded to this sector like low interest loans. At present the Banks confine themselves to only the evaluation and approval of SME projects. They do not play a role in the identification of projects and developing project profiles and feasibility studies to make them available to prospective investors. This is the policy followed by established development banks in India such as the National Bank for Agriculture and Rural Development. (NABARD). It is also the practice of the Small and Medium Enterprise Development Authority (SMEDA) of Pakistan.

(www.smeda.org.pk) The participation of the Banks in project identification and development would also result in channeling scarce resources into priority sectors of development and would contribute to the GDP. Government of Sri Lanka had established the National Development Bank for the purpose of promotion of industrial, agricultural, commercial and other evelopment of the economy of Sri Lanka having regard inter alia to the development of the rural sector.

One of the objectives of the NDB was to undertake development projects, including pilot projects, in order to achieve the purposes of the Bank. Unfortunately, the NDB acted like any other commercial bank and was finally privatized. It is no longer national.

It is suggested that a strong unit for formulation of model project reports is established in a State bank on the example of NABARD or SMEDA. I believe that these institutions will be ready to provide training on project identification and formulation to our officials.

An attractive reward scheme may also be introduced to invite innovative project ideas and reports from the public.