The Government has decided to suspend major foreign fund inflows for development projects for at least the next two years as the country’s foreign borrowings have risen to alarming levels, The Sunday Morning learnt. External Resources Department (ERD) Director General Priyantha Rathnayake told The Sunday Morning that the Government would accommodate only urgent and important foreign investment proposals during the period. “We want to slow down foreign financing a little bit because our foreign exposure has brought us to the extension stage and we need at least one or two years to get some space to accommodate new foreign loans. But of course the urgent and important investment proposals, we will still work on,” he observed. Asked whether the issue was because of not having a proper budget, the Director General said: “A Vote on Account is already passed and that has included the necessary foreign financing. The only thing is we cannot include new proposals within the first quarter as those have to be first incorporated into the new budget, and only then can the new projects be initiated.” During this period, we are focusing only on the ongoing projects, he added. The Government had not cancelled any of the pending negotiations, but it would proceed very selectively and with the most productive loans that were in line with the Government’s new policy priorities that have been published in the recent policy framework. Commenting on the new projects, he said they would be implemented depending on the Government’s priorities. “We will not go on large-scale borrowings considering the government fiscal policy and borrowing capacities,” Rathnayake added. As Rathnayake said, the Government would focus on existing projects within the first quarter of the year as there were a number of projects which were nearing completion. “In the meantime, once the major projects are finished, there will be enough space in the budget to accommodate new projects. There are several projects which are not up to the expected international standards and therefore there are pending activities to be completed to finish the existing loans,” he further noted.