June 01, 2008 (LBO) – Sri Lanka needs to market price energy and consumers are now not only paying for the rise in international prices, but also for the high expenditure involved in operating the public sector, a think tank has said. Referring to official statements that the fuel import bill this year may be around 4.0 billion US dollars The Point Pedro Institute of Development, a think tank, says direct and indirect subsidies on fuel should be removed.
Mutukisna Sarvanandan who heads the think tank says the state-run Ceylon Petroleum Corporation (CPC) should be privatized.
CPC has tens of thousands of employees, who have been ‘stuffed’ into the institution by successive governments.
In the first quarter of 2008 Lanka OIC, a unit of the Indian Oil Corporation which has about a quarter of the fuel retail business managed to turn a profit, compared to massive losses claimed at CPC.
“Sri Lankan consumers of petroleum products are not only paying for the rise in international prices,” Sarvanandan said.
“They are also paying for the bloated bureaucracy, corruption and wastages at the Ceylon Petroleum Corporation. Privatisation of the CPC is long overdue. ”
LIOC also refuses to sell kerosene at a loss and le