Sri Lanka To Obtain Loan Worth $500 Million From India For Fuel Purchase

Sri Lanka has sought a $500 million credit line from India to pay for its crude oil purchases as the nation is going through a severe foreign exchange crisis.

The country’s state-owned Ceylon Petroleum Corporation (CPC) owes about $3.3 billion to its government banks, namely: People’s Bank and Bank of Ceylon.

Sri Lanka’s energy minister Udaya Gammanpila has warned that the current availability of fuel in the island nation can be guaranteed only until January 2022.

Their state oil distributors import crude from the middle-eastern countries.

“We are currently engaged with the Indian High Commission here to obtain the facility (USD 500 million credit line) under the India-Sri Lanka economic partnership arrangement,” Sumith Wijesinghe, Chairman of the CPC, was quoted by the Financial Express.

This facility will now be utilised for purchasing their requirements for petrol and diesel.

The island nation’s Finance Secretary S R Attygalle informed that the energy secretaries of India and Sri Lanka are slated to sign an agreement for the loan soon.

In the meantime, the Lankan government has halted the expected retail price hike of fuel though they increased the prices of cooking gas and other essentials last week.