Video: MR Govt. launched projects without funds - CBK

12 June 2015 01:42 pm

Former president Chandrika Kumaratunge said today the Mahinda Rajapaksa government had initiated development projects illegally without finding funds needed for them and that the present government has had to pay back the loans obtained by them at exorbitant interest rates.

“No project can be initiated without crediting funds in the Treasury or finalising documents needed to fund such projects. It is illegal to do so. But the previous government launched such development projects including a drinking water supply scheme at an estimated cost of Rs.560 billion. They were forced to obtain loans at exorbitant interest rates to fund this project when contractors asked for money. Governments usually do not obtain loans at an interest rate of more than 2 percent but the previous government had obtained loans at interest rates of 9 per cent from China and European countries,” Ms. Kumaratunge said.

She said the government was renegotiating development projects initiated by the previous government without following the due tender procedure.(Ajith Siriwardana)

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