Economy

Budget surplus widens to Rs. 197.3 b through May on robust revenue growth

Published

1 month ago

July 14, 2026

Sri Lanka’s fiscal position strengthened further during the first five months of 2026, with the Government posting an overall Budget surplus of Rs. 197.34 billion, reversing a deficit of Rs. 236.63 billion in the corresponding period last year as revenue growth continued to significantly outpace expenditure.

According to the latest fiscal operations data released by the Central Bank of Sri Lanka (CBSL), total revenue and grants increased by 30.6% year-on-year (YoY) to Rs. 2.54 trillion during the January-May period from Rs. 1.94 trillion a year earlier.

Tax revenue, which accounted for the bulk of Government income, rose 23.9% to Rs. 2.32 trillion from Rs. 1.8 trillion in the corresponding period of 2025. Non-tax revenue recorded an even stronger growth of 54.2% to Rs. 211.84 billion from Rs. 137.38 billion, while grants declined to Rs. 1.34 billion from Rs. 2.49 billion.

Meanwhile, expenditure and lending minus repayments increased by 7.3% YoY to Rs. 2.34 trillion from Rs. 2.18 trillion, reflecting continued expenditure discipline despite higher public investment.

Recurrent expenditure rose 5.5% to Rs. 2.11 trillion, while capital expenditure and lending minus repayments climbed 29.3% to Rs. 226.83 billion from Rs. 175.37 billion in the same period last year.

The primary balance, a key fiscal indicator monitored under Sri Lanka’s International Monetary Fund (IMF)-supported reform program, improved to a surplus of Rs. 1.13 trillion during the first five months of the year, compared with Rs. 742.92 billion in the corresponding period of 2025, representing an increase of 52.3%.

The latest figures underscore continued improvement in public finances, with stronger revenue mobilisation enabling the Government to maintain sizeable primary and overall Budget surpluses while increasing capital expenditure during the period.

According to the IMF’s latest assessment, following temporary fiscal easing in 2026, the Government remains committed to restoring the primary surplus target to 2.3% of GDP in 2027 to safeguard macroeconomic stability.

Economy

CPC Seeks Investors As Natural Gas Confirmed in Mannar Basin

Published

3 days ago

August 13, 2026

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The Ceylon Petroleum Corporation says the process of calling for proposals to select an appropriate investor to extract and utilize the natural gas resources in the Mannar Basin will begin this month.

Managing Director of CPC, Dr. Mayura Neththikumara, said the presence of natural gas in the Mannar Basin has been scientifically confirmed by the Sri Lanka Petroleum Development Authority.

The relevant process will be carried out with the approval of the Procurement Committee, and investors will be given approximately five months to submit their applications.

Economy

Battery storage systems to join national grid in September

Published

5 days ago

August 11, 2026

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Commercial-scale battery energy storage systems being installed at 16 electricity transmission substations across Sri Lanka are expected to be connected to the national grid in early September.

The systems, which were brought into Sri Lanka through the Colombo Port in three stages during May and June, are currently in the final stages of construction.

The project being implemented by WindForce PLC near the Anuradhapura substation is now around 85% complete.

The battery systems will store excess electricity generated by solar power plants during the daytime and release the stored electricity to the national grid at night when required.

Officials said the system would help maintain the stability of the national grid while reducing the need to generate electricity from diesel power plants during nighttime hours.

Each battery energy storage project will have a capacity of 10 MW. The National System Operator Ltd. (NSO), operating under the Ministry of Energy, will be responsible for managing and controlling the systems, while their maintenance will be handled by the respective companies.

Economy

Delft Island to become Sri Lanka’s first zero emission eco‑tourism destination

Published

6 days ago

August 10, 2026

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The Government of Sri Lanka has unveiled plans to transform Delft Island into the country’s first Zero Emission eco‑tourism destination, with a strong emphasis on sustainability, environmental conservation, and the preservation of its unique natural and cultural heritage.

A special site inspection and stakeholder discussion on the proposed development was held under the leadership of Deputy Minister of Tourism Ruwan Ranasinghe recently.

The island, renowned for its Dutch‑era ruins, numerous archaeological landmarks, and iconic wild horses, is seen as possessing exceptional tourism potential.

Deputy Minister Ranasinghe told participants that Delft Island should be experienced not only by international visitors but also by domestic tourists. Despite its extraordinary attractions, he noted, the island has so far made only a limited contribution to Sri Lanka’s tourism industry.

He emphasized the Government’s commitment to unlocking Delft’s full potential through sustainable and environmentally responsible development.

Discussions focused on identifying priority infrastructure to position Delft Island as a premier tourism destination, with key areas including water supply, road infrastructure, transportation and accessibility. Strengthening community participation was also highlighted, with plans to enhance the knowledge and hospitality skills of local residents to enable them to benefit directly from tourism development.