Sri Lanka has approved a four-day work week for public sector workers to help them cope with a chronic fuel shortage and encourage them to grow food, the government said on Tuesday, as it struggles with its worst financial crisis in decades.

The island nation, which employs about one million people in its public sector, has been hit by a severe foreign exchange shortage, which has left it struggling to pay for critical imports of fuel, food and medicine.

Many of the country's 22 million people have to queue up at petrol stations for hours and have been enduring long power cuts for months.

Sri Lanka's Cabinet late on Monday approved a proposal for public sector workers to be given leave every Friday for the next three months, partly because the fuel shortage made commuting difficult and also to encourage them to farm.

“It seems appropriate to grant government officials leave of one working day ... to engage in agricultural activities in their backyards or elsewhere as a solution to the food shortage that is expected,” the government information office said in a statement.

The United Nations last week warned of a looming humanitarian crisis in the island nation, saying it plans to provide $47 million to help more than a million vulnerable people.

Currency depreciation, rising global commodity prices and a now-reversed policy to ban chemical fertiliser pushed food inflation in Sri Lanka to 57 per cent in April.

The government is in talks for a bailout package with the International Monetary Fund and a delegation is expected in Colombo on June 20.

The United States is also ready to help, Secretary of State Antony Blinken said after a phone call with Prime Minister Ranil Wickremesinghe late on Monday.

“During these economically and politically challenging times, the US stands ready to work with Sri Lanka, in close coordination with the International Monetary Fund and the international community,” Blinken said on Twitter.

Wickremesinghe said this month Sri Lanka needed at least $5 billion to meet essential imports for the rest of the year.