Five lakh individuals in Sri Lanka are estimated to have dropped below the poverty line since the outbreak, which the World Bank termed as “a major setback comparable to five years’ worth of development.”
According to the Census and Statistics Department said year-on-year inflation in December was the highest since the National Consumer Price Index (NCPI) was established in 2015. It said food inflation also hit a record 21.5 percent, up from 16.9 percent in November and 7.5 percent a year ago.
In order to feed people who are most in need, shops have already been reducing staples like milk powder, sugar, lentils, and other items for months. A government executive issued warnings about more limitations last month. Due to COVID-19’s devastating effects on the tourism industry, which have left countless numbers of people jobless, unemployment is also extremely high in the nation.
Sri Lanka has started talks with the International Monetary Fund (IMF) to salvage the economy and lessen the suffering of the people.around June IMF representatives visited Sri Lanka’s capital city of Colombo and had meetings with government representatives about economic reforms and policies that may be supported by an IMF Extended Fund Facility arrangement.
In addition to current discussions with the IMF, Sri Lanka is in discussions to create an assistance partnership with China, Japan, and India. Up to this point, India has given Sri Lanka aid of almost $3 billion, along with a $400 million exchange and $1.5 billion in outstanding loans.