MVR 724.8 million has been deposited into the Sovereign Development Fund (SDF), established with the purpose of earmarking funds for repaying government loans.
As per data provided by the Finance Ministry, SDF deposits have witnessed an uptick of 15.8 percent in the current year compared to the previous year. To provide context, MVR 625.6 million was deposited into the fund during the corresponding period last year.
The state budget has projected that MVR 871.4 million will reach the SDF by the end of this fiscal year. The primary objective behind the creation of the SDF was to ensure the capacity to repay loans in times of unforeseen financial difficulties. Initially established in 2017 as a countermeasure to address challenges related to servicing substantial loans associated with various development initiatives.
Contributions to the sovereign fund are funded by modifying the fees charged for services rendered by Velana International Airport (VIA).
Under recent amendments to the State Finance Act, the discretion to determine fund allocation and expenditure within the SDF now rests with the President, who will act upon the advice of the Finance Minister.
The Finance Ministry oversees the fund’s day-to-day management.