credit score line: Sri Lanka extends credit score line with India by $200mln for gasoline: Energy minister

Colombo was additionally in talks with New Delhi over extending the credit score line by a further $500 million, minister Kanchana Wijesekera advised a information convention.

Hit exhausting by the pandemic and wanting income after Gotabaya Rajapaksa’s authorities imposed steep tax cuts, the island nation is now additionally critically wanting international trade and has approached the Worldwide Financial Fund for an emergency bailout.

Rampant inflation and shortages of imported meals, gasoline and medicines has led to weeks of sporadically violent protests.

Sri Lanka has used $400 million, on a number of shipments in April, of the $500 million credit score line prolonged by India earlier this 12 months, Wijesekera mentioned. Two gasoline shipments will likely be paid for from the remaining funds in Might.

“The Indian credit score line was prolonged by $200 million not too long ago and this will likely be utilised for 4 shipments in Might. Talks are persevering with for an extra $500 million with India so in whole the credit score line will likely be $1.2 billion,” Wijesekera mentioned.

Nonetheless, Sri Lanka continues to be going through fee challenges for gasoline imports with the state-run Ceylon Petroleum Company (CPC) owing $235 million for shipments already obtained, whereas about $500 million extra will likely be wanted to pay for letters of credit score maturing over the subsequent six weeks, he added.

Sri Lanka may also want {dollars} to pay for crude oil shipments to complement imports from India.

“We now have made procurement plans until June however we nonetheless have to resolve how one can discover ample quantities of international trade to make funds,” Wijesekera mentioned.