Sri Lanka’s fuel crisis goes from bad to worse with President’s decision to step down | India is blooming

Colombo: fuel queues in Colombo, Sri LankaThe capital and its suburbs have lengthened up to eight kilometers each.

The minimum wait time for a vehicle to receive fuel is four hours. This trend has been going on for four months and despite the resignation of the president and his cabinet, it is unlikely to stop, according to economic analysts.

Nandasena Fernando Raju (26), an electrician turned three-wheeler driver due to the acute economic crisis, told United News of India that he left Kalutara out of necessity to get jobs in Colombo and suburbs.

Now, on the 12th day in Colombo, he eats pretty much sleeps and puts his clothes to dry in the three-wheeler. “I brought a set of clothes and a pillow. I sleep on the three-wheeler and haven’t seen my parents for 12 days.

He said that four months ago he was earning a very good income of 150,000 rupees per month and managed to live in his hometown in his ancestral home with his parents and had a job which he started at l 19 years old just after finishing his studies.

“I took out housing contracts and created my own company called FR Constructions. I had to give it up because not many people wanted to have their homes wired and the cost of the equipment was increasing exponentially,” he added. The stock of equipment needed for cabling, which cost 45,000 rupees in February, rose to 96,000 rupees in June.

“People didn’t have the money to spend on such expensive things,” he added.

Raju noted that renting a three-wheeler earns him 7,500 rupees a day and that he has to set aside around 2,500 rupees for petrol.

“But I’m in the petrol queue for three to four days and it’s really not worth it,” he added that he spends Rs. 23,000 a month to fund the three- wheels that brings him just enough income for his survival only.

Raju added that the resignation of the president and the cabinet will not bring any immediate solution or relief, adding that it will take at least another three to four years to restore the fuel and cooking gas situation.

After a request from the Treasury General, the Central Bank revealed last week that it would provide cash worth Rs 217 billion to finance fuel imports by Ceylon Petroleum Corporation (CPC).

The banking regulator issued Rs 107 billion to CPC last Friday. In a special issue of treasury bills at the Central Bank, the government had borrowed this money because CPC is still experiencing an acute rupee liquidity crisis, in addition to the dollar crisis, even after raising the prices of the petroleum products at extreme levels a few times, thanks to what turned out to be a controversial pricing formula.

Since late June, the state-run CPC provided fuel only for essential services, including power generation.

Sri Lanka spends about $100 million to import the fuel needed to run its thermal power plants and the Ministry of Energy a few days ago bought 7,500 metric tons of diesel from the Lanka Indian Oil Corporation (LIOC) to $11 million to operate essential services.

Central Bank Governor Dr Nandalal Weerasinghe highlighted the aversion the regulator faces when implementing monetary financing, telling reporters that it is not something neither they nor the Treasury do not like to do, but that in the current context, they are obliged to respond to certain requests to meet their requirements.

Until September last year, Treasury bill auctions saw only a fraction of the market’s subscriptions, due to yield controls, and so the balance had to be purchased by the Central Bank through of printed money, which also contributed to the exponential monetary expansion. .

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