The Sri Lankan Government signed an agreement with the Lanka Indian Oil Corporation (LIOC). According to the agreement, Sri Lanka will lease oil tanks to IOC.
Sri Lanka has leased 14 tanks to LIOC for fifty years. Another 24 tanks have been leased to CPC. CPC is joint venture of LIOC and Trinco Petroleum Private Limited. CPC is Ceylon Petroleum Corporation. The CPC is to develop 61 oil farms in the country.
Under the agreement signed in 2003, Sri Lanka agreed to lease all of its 99 tank oil farms to India. This has now been nullified by the new agreement. The new agreement brings in new Governance structure.
Sri Lanka is under huge financial pressure. The country has to repay 4.5 billion USD in 2022 alone. Its Foreign Exchange reserves are decreasing largely.