The state has proposed an MVR 36.9 billion budget for the year 2022 to the parliament, of which MVR 34 billion stands as state expenditure.

The proposed state budget for 2022 was presented by Finance Minister Ibrahim Ameer today.

While proposing the budget, the Minister noted that the budget is in a deficit of MVR 9.7 billion – which is 11.1 percent of the GDP. The Minister highlighted that the projected total revenue inclusive of revenue and grants is MVR 24.3 billion, which is a 23 percent increase in comparison to 2021. The projected revenue also includes MVR 15.4 billion as tax revenue and MVR 6 billion in non-tax revenue. It is projected that the government will receive MVR 2.9 billion in grants and other revenue.

The state budget for 2022 also includes several new revenue measures, that have been proposed in line with the government’s policies and its electoral pledges, according to the Minister. As such, the new measures are; selling land reclaimed at the government’s expense to private parties. introduction of real estate tourism, leasing islands for the development of resorts, and a tax on a variety of single-use plastics.

The Minister revealed that in order to finance next year’s budget, a total of MVR 13.4 billion needs to be secured. That is the MVR 9.7 billion in deficit, MVR 2.9 billion needed to repay loans along with MVR 769.2 million needed to transfer to the Sovereign Development Fund, as well as MVR 35.7 million that needs to be financed through other sources.

MVR 7.5 billion from the budget is expected to be financed through foreign sources, while MVR 5.9 is expected to be financed through local sources. This includes USD 200 million through the sale of bonds and Sukuk to the international market as well as USD 50 million through an innovative financing instrument.

The Minister also added that the infrastructural projects being conducted by the government will pick up speed during the coming year, adding that disbursements for projects being carried under loans will also increase. This includes projects under the USD 800 million Line of Credit by India's Exim Bank, Velana International Airport developmental projects and the Greater Male' Area connectivity project under the USD 400 million Line of Credit from India's Exim Bank.