Inflation hits 30% in Lanka
Debt-ridden Sri Lanka’s overall inflation surged to nearly 30 per cent in April from 18.7 per cent recorded in March, according to the official figures, as the island nation grapples with its worst economic crisis in decades.
According to the data published by the government’s Census and
Statistics Office, the overall inflation hit 29.8 per cent in April.
Sri Lanka is in the grip of an unprecedented economic turmoil since its independence from Britain in 1948. The crisis is caused in part by a lack of foreign currency, which has meant that the country cannot afford to pay for imports of staple foods and fuel, leading to acute shortages and very high prices.
The food inflation increased from 30.21 per cent in March to 46.6 per cent in April. Most food items have recorded price increases.
The government’s decision to float the rupee in March after it ran out of dollars to defend a peg has depreciated the currency by over 60 per cent. This has had a spiralling effect on all prices of essentials.
Sri Lanka needs at least $4 billion to tide over its mounting economic woes, and talks with international institutions such as the World Bank as well as countries like China and Japan for financial assistance have been going on.
The country has run out of foreign currency to import badly-needed essential goods.
Last month, the Sri Lankan government said it would temporarily default on $35.5 billion in foreign debt as the pandemic and the war in Ukraine made it impossible to make payments to overseas creditors.