Kabir slams Govt.’s economic policies

SJB MP Kabir Hashim 

•  Accuses Govt. of abandoning campaign promises and embracing neoliberal economic model it opposed earlier
• Claims 2025 Budget is ‘repackaged’ version of Wickremesinghe’s policies
• Alleges Budget allocations prioritise debt repayment, banking stability, infrastructure over education, healthcare, industrial exports and SMEs 
• Says foreign reserves of $ 6.1 b misleading, as $ 3.3 b in debt obligations due in 2025 and $ 1.5 b in vehicle imports, potentially pushing reserves back to ‘zero’
• Opines indirect taxes worsened inequality; though casinos, black-market businesses, high-earning professionals and tuition masters evade taxes
• Describes President AKD as ‘Valentine of IMF’, betraying his ‘system change’ promise to public

Main Opposition party, Samagi Jana Balawegaya (SJB) MP Kabir Hashim on Friday raised serious concerns over the Government’s economic policies during the final Budget debate, accusing President Anura Kumara Disanayake of betraying public trust.

He accused the Government of abandoning its campaign promises and embracing a neoliberal economic model they opposed for over six decades.

Hashim claimed that the Government’s economic policies are nothing more than a ‘repackaged’ version of Wickremesinghe’s policy approach.

“The NPP-Janatha Vimukthi Permauna (JVP) Government has failed to provide clear answers to Opposition questions raised during the debate, instead resorting to bluff and misdirection. It clearly shows that the Government has already fallen from grace amid failure to deliver the system change it promised,” Hashim added.

Despite improvements in macroeconomic indicators since 2022, he criticised the 2025 Budget allocations, noting that focus on spending priorities do not align with the needs of the public.

“The middle-income class remains trapped in financial hardship, while small and medium-sized enterprises (SMEs) and self-employed individuals continue to struggle,” he pointed out, adding that the Government has allocated more funds to service debt and support the banking system which has made outstanding profits in 2024.

He highlighted that debt repayment, roads and highways, and financial institutions’ stability are taking priority over essential sectors such as education, healthcare, export industries, and other critical areas of development.

“A total of Rs. 400 billion has been allocated for roads and highways, while only Rs. 8 billion is set aside for industrial development, Rs. 2 billion for investment promotion, and Rs. 20 billion for SMEs – a figure unchanged from the previous administration,” he pointed out.

In addition, he opined that despite reporting record profits by banks in 2024, the Government has funnelled Rs. 450 billion into commercial banks under the guise of stabilising them, although these institutions are already well-capitalised beyond the Basel III requirement.

“The Government continues to protect the banking sector without supporting struggling SMEs, which form the backbone of the economy,” he charged.

Hashim also pointed out that the country’s foreign reserves of $ 6.1 billion is misleading, explaining that $ 1 billion of this is a Chinese swap, significantly reducing the available balance, with more unsettled payments to multilateral and bilateral agreements.

“The country has not settled payments to the Asian Clearing Union since 2022 following the debt default announcement, with $ 75 million due per month to the Reserve Bank of India, amounting to $ 900 million in March alone. Additionally, the country must pay $ 800 million in arrears interest, $ 1 billion in bilateral and commercial loan repayments, and $ 1.5 billion to multilateral institutions such as the Asian Development Bank (ADB), World Bank, and OPEC. On top of that, $ 300 million in interest is due on the International Monetary Fund (IMF) loan this year. This brings Sri Lanka’s total debt obligations for 2025 to $ 3.3 billion,” he explained.

With another $ 1.5 billion allocated for vehicle imports, Hashim warned that gross reserves could plummet to ‘zero’ again, calling to question whether the Government is truly on the right economic footing.

The MP also slammed the Government’s taxation policies, asserting that the increase in indirect taxes has widened economic inequality.

“Although tax revenue has increased last year compared to 2022, tax collection remains inefficient – as casinos, black-market businesses, high-earning professionals, and tuition masters continue to operate without proper tax contributions,” he claimed.

Hashim said the Inland Revenue Department (IRD) remains ineffective and the RAMIS digital tax system is not operational, further delaying much-needed reforms in tax collections.

In a stinging rebuke, Hashim took direct aim at President Disanayake, claiming that his leadership has betrayed the hopes of a ‘system change’ by people.

“Disanayake was once the ‘Valentine of the people.’ But today, he is the ‘Valentine of the IMF,’ abandoning the promises made to the people,” Hashim said.

He stated that the public once admired Disanayake’s simple double-pocket shirt, but now they see him as someone who has deceived them.

The Opposition MP also criticised the ruling party’s transformation, stating that the working-class politicians who once campaigned in simple shirts and trousers are now seen in suits – detached from the struggles of the people.