The lubricant market in Sri Lanka is currently controlled by a few companies and hence he proposes to open up this market said Finance Minister Ravi Karunanayake in his recent Budget speech in Parliament.

When adaderanabiz.lk inquired about this proposal from Chevron Lubricant Lanka PLC Managing Director Kishu Gomes, his response was that there is nothing new to open up in Sri Lanka’s lubricant market since it already remains open.

“This is already an open market. But the issue here is there being no regulations. There are no controls. So if more players enter this market then the consumers would not be able to get what they need and the government wouldn’t be able to get the necessary revenues,” he added.

“Currently there are 13 authorised companies in Sri Lanka competing in the lubricant market. The annual requirement for lubricants in Sri Lanka is 53 million litres. Hence, each company enjoys a share of around four million litres. But though India’s annual requirement is some two billion litres, there are only 21 companies competing in this Indian market. If compared against this scenario, the competitors in Sri Lanka’s lubricant market are more than enough. All the internationally prominent lubricant brands are already in Sri Lanka. Furthermore, the Sri Lankan government too competes in this market,” said Kishu Gomes.

According to Managing Director Gomes, there are 17 unauthorised institutions currently active within Sri Lanka’s lubricant market. Since the government does not have a regulator or the means of regulating there is no mechanism to regulate this situation.

While stating that now there are three companies engaged in producing lubricants in Sri Lanka, Kishu Gomes added that these companies posses thrice the capacity of Sri Lanka’s lubricant requirements and hence he does not see any need for more companies to enter this market.

However, on inquiring about the Budget proposals for 2016, Chevron Lubricant Lanka PLC Managing Director Kishu Gomes said, “In fact, now we have a direction and are happy about that. This makes it clear that the government depends on the private sector. So we can say this is a positive budget.”