Sri Lanka's Evolving Car Import Landscape: A Post-Pandemic Revival

Sri Lanka's car imports have declined post a temporary surge after imports were permitted this year for the first time in four years, says Central Bank Governor Nandalal Weerasinghe. Despite this, the nation anticipates substantial foreign inflows and continues to recover from a severe forex and sovereign debt crisis.

Since Sri Lanka reopened its doors to car imports in February, the initial rush of demand has now dwindled. This observation was made by the Central Bank Governor, Nandalal Weerasinghe, during a press briefing on Wednesday.

Weerasinghe noted a rise in letters of credit initiated for car imports starting July due to accumulated demand. However, a comparison of import data since September indicates a downward trend in these numbers.

The depreciation of the local currency is linked to increased imports, including vehicles. Despite past challenges, including a sovereign default and reliance on an Indian credit line, Sri Lanka looks forward to USD 750 million in inflows by year-end, supported by an IMF bailout package.

(With inputs from agencies.)