Sri Lanka, First Published Mar 31, 2022, 9:26 PM IST
Due to the severe economic crisis in Sri Lanka, it has been reported that street lights will no longer be lit in the country to save electricity due to fuel shortages.
Economic Crisis:
Thus, the Minister of Power has instructed the authorities to close street lights across the country. Due to the economic crisis, the prices of all commodities across the country have risen to an all-time high. People are unable to buy essential items and various restaurants are being closed due to shortage of gas cylinders. People are switching to a diet twice a day.
Population:
Petrol stations have been closed due to the inability to import petrol and diesel from abroad. At some stations, people stand in long queues with military security to put up petrol and diesel vehicles to prevent violence. Prices of all food items, including milk powder, wheat and cooking oil, have peaked. A state of emergency has been declared to prevent food smuggling in the country.
Inflation, Deficit:
Retail inflation was 18.7% in March and food inflation was 30.2%. Sri Lanka has the worst inflation ever. The country’s fiscal deficit widened from 5% in 2020 to 15% in 2021. The country’s economic growth for the third quarter of fiscal 2021 was minus 1.5%. Diesel is expected to be imported from India on Saturday under a $ 500 million debt tax. The Sri Lankan government has said that the power outage will continue until May, although the power cut will be reduced thereafter.
Power cut:
Concerned that we can do nothing else, the Minister of Power said that the water level in the reservoirs had dropped to an all-time low and that the hydro-electricity project had not been handed over and that the demand for electricity had reached its peak in the summer. ) Daily trading has been reduced from the usual four and a half hours to two hours.
Tax cuts, organic farming:
It is said that the reason for the economic crisis in Sri Lanka is the change made in the taxation system of the country. As the tax was reduced from 15% to 8%, tax revenue in the country began to pick up. As the government implemented organic farming without further study, the production of tea, pepper, auctions and vegetables in Sri Lanka began to decline by about 30%. Sri Lanka has borrowed $ 51 billion abroad. Of that, $ 7 billion is the amount of debt that needs to be repaid immediately. But the foreign exchange reserves are only $ 2 billion. That too is not enough to cover daily imports.
Last Updated Mar 31, 2022, 9:26 PM IST