Lankan President Rajapaksa dials Putin; explores options for purchasing oil

Colombo: Sri Lankan President Gotabaya Rajapaksa on Wednesday said he had a “very productive” conversation with his Russian counterpart Vladimir Putin to negotiate a credit line for purchasing discounted oil from Moscow to “defeat” the worst economic challenges faced by the island nation.

During their conversation, Rajapaksa also urged Putin to restart the services of the Russian flag carrier Aeroflot to the country.

Sri Lanka is going through the worst economic crisis since its independence from Britain in 1948, and needs to obtain at least USD 4 billion to tide over the acute shortage in foreign exchange reserves.

Had a very productive telecon with the Russian President Vladimir Putin. While thanking him for all the support extended by his government to overcome the challenges of the past, I requested an offer of credit support to import fuel to Lanka in defeating the current economic challenges, President Rajapaksa said in a tweet.

The two presidents discussed issues of bilateral economic cooperation, in particular in energy, agriculture and transport, according to a press statement released by the Kremlin in Moscow.

In May, Sri Lanka had purchased 90,000 tonnes of oil from Russia.

Western countries have largely halted energy imports from Russia as part of the punitive sanctions on Moscow over its invasion of Ukraine in February.

A spike in global oil prices has forced a number of developing countries to buy Russian crude, which is being offered at steep discounts.

A Sri Lankan delegation is also scheduled to leave for Russia on July 9 to hold several rounds of preliminary discussions with high-ranking representatives in Moscow on obtaining fuel, fertilisers, gas, loans and humanitarian aid, according to web portal Colombo Page.

The Sri Lankan President said that during his telephonic conversation with Putin, they agreed to bolster bilateral ties in sectors like tourism, trade and culture.

Rajapaksa also urged Putin to restart the services of Aeroflot in the country, which was suspended last month.

Further, I humbly made a request to restart @Aeroflot_World operations in Lanka. We unanimously agreed that strengthening bilateral relations in sectors such as tourism, trade and culture was paramount in reinforcing the friendship our two nations share, he said in another tweet.

In June, Aeroflot suspended its flights to Sri Lanka after the island nation’s aviation authority prevented a flight of Russia’s flag carrier to depart the Colombo airport.

On Monday, the Sri Lankan government announced that only essential services will operate from midnight till July 10 and all other operations will be temporarily suspended as the country of 22 million faced an acute fuel shortage.

The country, with an acute foreign currency crisis that resulted in foreign debt default, had announced in April that it is suspending nearly USD 7 billion foreign debt repayment due for this year out of about USD 25 billion due through 2026.

Sri Lanka’s total foreign debt stands at USD 51 billion.

The Sri Lankan economy has virtually come to a grinding halt after it has run out of foreign exchange reserves to import fuel.

Sri Lankans continue to languish in long fuel and cooking gas queues as the government is unable to find dollars to fund imports.

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