Credit line

New Indian credit line to help buy fuel for another 4 months: Prime Minister of Sri Lanka

The Sri Lankan prime minister said authorities will ensure there is a continuous supply of fuel. (CASE)

Dove:

Sri Lankan Prime Minister Ranil Wickremesighe said on Tuesday that a new line of credit provided by India would support the cash-strapped island nation’s fuel purchase for another four months from July, even as 3,500 tonnes of LPG cargo reached Sri Lanka.

The gas from this shipment will be delivered to premises that obtain bulk inventory such as hospitals, hotels, crematoriums, he told the News First website.

The next shipment will deliver LPG for a period of four months and we will need another 14 days to access this shipment, Mr Wickremesighe said, adding that Sri Lanka is in talks to secure a shipment within those 14 days.

He said authorities will ensure there is a continuous supply of fuel, but it will only meet 50% of current demand.

“Priority will be given to power generation, transport and other essential services,” Wickremesighe said.

Existing stocks will last for another seven days, he said, adding that a shipment of 40,000 tonnes of fuel will reach Sri Lanka by June 16.

In addition, individual gasoline and diesel shipments will reach Sri Lanka thereafter, supplementing the fuel requirements for that month.

Mr Wickremesinghe said two shipments of fuel will be purchased for July.

He said a new line of credit with India would support the purchase of fuel for another four months from July.

Fuel delivery will be available for 50% of in-country demand.

Mr Wickremesighe said he had obtained Cabinet approval to print money to make the purchases of fuel and gas for the country.

Sri Lanka has no rupee revenue and by the end of the year the rupee crisis will be resolved with the introduction of taxes, he said.

“We are discussing with the IMF to solve the dollar crisis. On June 7, I spoke to the Managing Director of the IMF, and she assured me to expedite our request. Following this meeting, a delegation will go to the Sri Lanka on June 20,” he said in a statement.

Sri Lanka is currently facing its worst economic crisis since its independence from Britain in 1948.

The economic crisis has caused severe shortages of essential items like food, medicine, cooking gas and other fuels, toilet paper and even matches, with Sri Lankans forced to queue for hours outside shops to buy fuel and cooking gas.

The country is experiencing long queues for refueling at pumping stations as the government struggles to fund fuel imports to maintain a sufficient reserve for at least three months.

A shift to fuel rationing is to be implemented from next month as the forex crisis deepens.

The country on the verge of bankruptcy, with an acute currency crisis that led to a default on external debt payments, announced in April that it was suspending the repayment of nearly $7 billion in external debt due for this year on approximately $25 billion due through 2026.

Sri Lanka’s total external debt stands at $51 billion.

(This story has not been edited by NDTV staff and is auto-generated from a syndicated feed.)