Colombo: Sri Lanka was on Wednesday given temporary relief from an energy crunch and rolling blackout, with a $500 million loan from India for immediate funding. buy oil For a country facing cash crunch.
The island’s economic crisis has left thermal power generators unable to light up and disrupted transport networks, as traders run extremely low on foreign exchange to fund imports.
Repeated breakdowns at a huge coal power plant have led to an unannounced increase in power cut And the families are also struggling for the source of cooking gas and kerosene.
Officials said a formal agreement was being signed on Wednesday after two weeks of talks, apart from a recent foreign exchange assistance of $915 million.
An Indian diplomat said talks are underway on a $1 billion line of credit for urgently needed food and pharmaceutical imports from India.
“$500 million is to buy Sri Lanka Petroleum products from Indian suppliers,” the official said.
economy of sri lanka There are also shortages of rice, motor vehicle parts and cement, forcing supermarkets to ration some staple food items.
the shortcomings pushed food inflation Last month at a record 25 per cent.
Tourism is a major foreign exchange earner for Sri Lanka, but the sector has collapsed in the wake of the covid-19 pandemic,
The government has closed foreign diplomatic missions to save money and a broad ban on imports to conserve foreign exchange has been in place for nearly two years.
Three international rating agencies have downgraded the island since late last year, fearing it might not be able to repay its $35 billion government debt.
Sri Lanka has sought more loans from Beijing to help pay off its existing Chinese debtWhich is about 10 percent of the country’s external borrowing.
Authorities have in the past borrowed heavily from China for infrastructure projects, some of which ended up as costly white elephants.
The island’s economic crisis has left thermal power generators unable to light up and disrupted transport networks, as traders run extremely low on foreign exchange to fund imports.
Repeated breakdowns at a huge coal power plant have led to an unannounced increase in power cut And the families are also struggling for the source of cooking gas and kerosene.
Officials said a formal agreement was being signed on Wednesday after two weeks of talks, apart from a recent foreign exchange assistance of $915 million.
An Indian diplomat said talks are underway on a $1 billion line of credit for urgently needed food and pharmaceutical imports from India.
“$500 million is to buy Sri Lanka Petroleum products from Indian suppliers,” the official said.
economy of sri lanka There are also shortages of rice, motor vehicle parts and cement, forcing supermarkets to ration some staple food items.
the shortcomings pushed food inflation Last month at a record 25 per cent.
Tourism is a major foreign exchange earner for Sri Lanka, but the sector has collapsed in the wake of the covid-19 pandemic,
The government has closed foreign diplomatic missions to save money and a broad ban on imports to conserve foreign exchange has been in place for nearly two years.
Three international rating agencies have downgraded the island since late last year, fearing it might not be able to repay its $35 billion government debt.
Sri Lanka has sought more loans from Beijing to help pay off its existing Chinese debtWhich is about 10 percent of the country’s external borrowing.
Authorities have in the past borrowed heavily from China for infrastructure projects, some of which ended up as costly white elephants.
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