The transfer got here few days after power minister Udaya Gammanpila warned that the present availability of fuel within the nation may be assured solely until subsequent January.
The state-run Ceylon Petroleum Corporation (CPC) owes practically USD 3.3 billion to the 2 foremost authorities banks — Financial institution of Ceylon and Folks’s Financial institution. The state oil distributors imports crude from the Center East and refined merchandise from different areas, together with Singapore.
“We’re at the moment engaged with the Indian Excessive Fee right here to acquire the ability (USD 500 million credit score line) beneath the India-Sri Lanka financial partnership association,” CPC Chairman Sumith Wijesinghe was quoted as saying by native information web site newsfirst.lk.
He stated the ability can be utilised for buying petrol and diesel necessities.
The power secretaries of each India and Lanka are anticipated to signal an settlement for the mortgage quickly, the report quoted Finance Secretary S R Attygalle as saying.
The federal government has placed on maintain the anticipated retail worth hike of gasoline regardless of the final week’s enhance in cooking fuel and different necessities.
The value hike within the world oil costs has compelled Lanka to spend extra on oil imports this yr. The nation’s oil invoice has jumped 41.5 per cent to USD 2 billion within the first seven months of this yr, in comparison with final yr.
Lanka is dealing with a extreme international change disaster after the pandemic hit the nation’s earnings from tourism and remittances, Finance Minister Basil Rajapaksa had stated final month.
The nation’s Its GDP contracted by a report 3.6 per cent in 2020 and its international change reserves plunged by over a half in a single yr via July to simply USD 2.8 billion. This has led to a 9 per cent depreciation of the Sri Lankan rupee in opposition to the greenback over the previous one yr, making imports dearer.