Central Bank seeks price revision to fuel, electricity at least to cover cost 

The Central Bank wants the government to revise the price of fuel and electricity at least to cover the full cost of bringing them to the end consumer in order to end the external and fiscal sector woes created by the loss making State-run utilities in the country.

As a part of the eight-point plan proposed last Friday, the Central Bank wants the government to revise the prices of the two utilities “immediately” to ensure economic stability.

When pressed for how much of a price increase the Central Bank was looking at, Governor Ajith Nivard Cabraal said the price revision has to cover at least the cost of bringing the two services to the end consumer.  
“What we have said is at a minimum the price revision must happen to cover the cost,” he said.

Sri Lanka’s economy is in dire straits with fuel shortages, daily power cuts, other commodities shortages and more than a decade high inflation.

With the hydropower capacity declining due to dry weather, Sri Lanka is at the mercy of oil and cola-powered thermal power.

But the fuel shortage caused by the dollar crunch has hamstrung the country’s capacity to generate thermal power as of late, causing daily power cuts running up to over seven hours.

Up to now the authorities haven’t come up with a credible plan to end the prevailing foreign exchange shortage.