BusinessWorld

Sri Lanka hikes fuel prices to tackle the economic crisis

Colombo: Sri Lanka’s government has increased fuel and transport prices, in a long awaited move to combat its debilitating economic crisis, Al Jazeera reported on Tuesday.

It is expected that the hikes will exacerbate the already galloping inflation, at least in the short term.

Power and energy minister Kanchana Wijesekera tweeted on Tuesday that petrol prices would increase by 20-24 percent while diesel prices would rise by 35-38 percent with immediate effect, adding that the cabinet also approved the revision of transportation and other service charges accordingly.

Wijesekera further said that in order to manage the energy crisis the government will encourage people to work from home in an effort to minimize the use of fuel and all public sector officials will work from their offices only when they are instructed by the head of the institution.

Experts have said that food and transport price increases will flow through to food and other goods, adding that fuel and power price hikes are necessary to plug a massive gap in government revenues, warning that it will lead to short-term pain for the people.

They further said that it is the poor who will be the most affected by this price rise and said that the solution is to establish a cash transfer system to support the poor and increase efficiency as much as possible.

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Via UNI-India
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