Sri Lanka's prime minister says will slash expenditure in new budget

People wait in a line to buy domestic gas tanks near a distributor, amid the country's economic crisis, in Colombo, Sri Lanka, May 24, 2022. REUTERS/Dinuka Liyanawatte
Sri Lanka's new Prime Minister Ranil Wickremesinghe said on Tuesday he will present an interim budget within six weeks, slashing down on infrastructure projects and re-routing funds into a two-year relief programme for the crisis-hit island nation.

"With the interim budget, it is just about cutting down expenditure, cutting to the bone where possible and transferring it to welfare," Wickremesinghe, who took office two weeks ago, said in an interview.

Inflation in the country of 22 million people, which is being battered by its worst economic crisis since independence, could rise above an annual 40% as the government rolls back fuel subsidies and prints more money to keep the economy afloat, he said.

"We have no rupee revenue, and now we have to print another (one) trillion rupees," he said.

Wickremesinghe added the country would appoint a new finance minister on Wednesday, who will lead negotiations with the International Monetary Fund for a loan package.