The Treasury has rejected claims made by certain factions that the government is unable to issue Letters of Credit to import powdered milk and LP gas since foreign reserves of the Central Bank have depleted.
Secretary of the Ministry of Finance SR Attygalle said so far, the foreign reserves have not played a part in importing the two commodities to Sri Lanka.
Speaking to media at the Department of Government Information today, SR Attygalle also predicted that the prices of powdered milk would fall considering present economic conditions.
He also was confident that importers of powdered milk can access funds and support of their parent company, since 70% of powdered milk are imported by multinational companies.
Meanwhile, media questioned the Secretary of the Ministry of Finance over printing more than Rs. 213 billion cash notes, making it the largest sum of rupees to be printed in a single day.
In response, Secretary Attygalle said that amount will be used to repay rupee loans taken out by the Central Bank. He also assured that the printed money will not be released into public circulation.
Therefore, he claimed that printing money for such a purpose would not result in an increase in inflation in Sri Lanka.