India comes to the aid of crisis-hit Sri Lanka, to send 40,000 tonnes of diesel

India has agreed to a request from neighboring Sri Lanka for urgent supply of a diesel consignment with around 40,000 tonnes of the fuel set to be sent to the island nation that is currently battling one of its worst economic crisis ever. Fuel rates in Sri Lanka have jumped to record high levels while supply has been dwindling. The situation here is so grave that the government had to order troop deployment at fuel stations earlier this week to ensure orderly distribution.

According to a Hindustan Times report, state-run Indian Oil Corporation (IOC) is likely to send a consignment of 40,000 tonnes of diesel to Sri Lanka. Seven monthly shipment of petrol, diesel and aviation fuel is also being sent under a line of credit for purchasing petroleum products which was agreed upon last month. The 40,000 tonnes of diesel is over and above this.

While countries the world over are grappling with a very volatile oil price and supply situation in the aftermath of Russia invading Ukraine, the situation has reached alarming levels in Sri Lanka where the value of the local currency has taken a nosedive and import costs have skyrocketed. Prices of essential items, apart from petrol and diesel, have jumped manifold. With cooking oil and milk products becoming far more expensive than these have ever been, pre-owned vehicles are an item of luxury and selling for more than plush homes in many parts.

Sri Lanka imports all of its petroleum requirements while India imports nearly 85% of its needs. But while India has a rather tricky road to walk as well - fuel prices have now been hiked thrice in four days - the country has reportedly responded to the urgent call from Sri Lanka. India’s Export Import (Exim) Bank and the Sri Lankan government signed an agreement for the $500-million line of credit for purchasing petroleum products from the Indian side on February 2. India has also extended a Saarc currency swap facility of $400 million and deferred the payment of $515.2 million to the Asian Clearing Union (ACU) by two months to assist Sri Lanka.