President Gotabaya Rajapaksa today defended the decision to increase fuel prices saying it will help strengthen the local economy.
Issuing a statement, the President said that increasing fuel prices will help strengthen the country’s banking system and maintain low interest rates, reduce foreign exchange spending and strengthen the exchange rate.
He also said that it is a decision taken to safeguard the health and welfare of the people and to transform the import-dependent consumer economy into an investment and consumer economy dependent on domestic production.
The President said that Sri Lanka has become a country that not only spends a large amount of foreign exchange for fuel imports, but also a country where its transport services, power generation and the function of some of the factories are based on these imports.
In addition to spending foreign exchange, the President said that the Ceylon Petroleum Corporation (CPC) has been a loss-making institution, relying on loans obtained from the Bank of Ceylon and the People’s Bank annually.
“The amount to be paid to the two banks as loans is Rs. 652 billion. As the Ceylon Electricity Board (CEB) has also to repay nearly Rs. 85 billion in loans to the two banks, the Treasury has issued bonds on loans given by the state banks and it has to pay a higher interest on the loans as well,” he said.
Energy Minister Udaya Gammanpila announced on Friday that a decision had been taken to increase fuel prices.
Accordingly, the Ceylon Petroleum Corporation (CEYPETCO) announced that Petrol Octane 92 has been increased by Rs. 20 per litre, Octane 95 by Rs. 23, Auto Diesel by Rs. 07, Super Diesel by Rs. 12 and Kerosene oil by Rs. 07.
Lanka Indian Oil (LIOC) had also increased fuel prices. (Colombo Gazette)