Facing widespread protests over high electricity tariffs, the Sri Lankan government on Saturday announced that it will use an Indian credit line of USD 100 million to pay for roof top solar panels at state buildings and religious institutions.

In August, Sri Lanka hiked the electricity tariff by an average of 75 per cent, after nine years. The government raised electricity tariff to minimise the losses of the state power entity Ceylon Electricity Board (CEB).

Leading Buddhist monks and senior catholic priests raised objections and warned of blackouts at religious places while not honouring bills.

Energy Minister Kanchana Wijesekara in a statement on Saturday said USD 100 million credit line extended by India for rooftop solar will be used to equip schools, universities, education institutes, hospitals, government buildings and religious institutes.

Following widespread protests by religious leaders, the Public Utility Commission, the regulatory body, said a concession would be offered to rates for the religious institutions. Around 48,000 religious institutions are electricity consumers. However, the minister said the Commission must inform the CEB as to how the rates could be subsidised.

Sri Lanka, a country of 22 million people, is going through its worst economic crisis since its independence in 1948 which was triggered by a severe paucity of foreign exchange reserves.

In mid-April, Sri Lanka declared its international debt default due to the forex crisis. The country owes USD 51 billion in foreign debt, of which USD 28 billion must be paid by 2027. A crippling shortage of foreign reserves has led to long queues for fuel, cooking gas, and other essentials while power cuts and soaring food prices have heaped misery on the people.

India has extended bilateral assistance amounting close to USD 4 billion this year to Sri Lanka.