India Extends Credit Line, Fuel, Food To Bail Sri Lanka Out of Economic Crisis
Columbo: Sri Lanka is reeling under a deep economic crisis as the country's foreign reserves have been depleted and the Rajapaksa government is struggling to pay for the import of fuel.
As a result, there is an acute power shortage in the country and violent protests are being reported. The government has declared an emergency and a countrywide 36-hour curfew has been imposed due to the protest on Sunday as of now around 600 protesters have been arrested.
In these difficult times, India has come forward to bail the island nation out of the crisis. India has responded to urgent requests from Sri Lanka with promptness.
"Since January this year, support from India to Sri Lanka exceeds USD 2.5 billion. A fuel line of credit of USD 500 million was signed in February. Four consignments totalling over 150,000 tons of jet aviation fuel, diesel and petrol have since arrived beginning in March. Five more consignments are to follow till May. Another line of credit of USD 1 billion for food, medicine and essential items was signed last month," Gopal Baglay India's High Commissioner to Sri Lanka told ANI.
"The first consignment of rice from India is expected to arrive in Sri Lanka shortly under this credit facility," Bagley added
Besides, the Reserve Bank of India has extended a currency swap of USD 400 million and deferred payments owed by the Central Bank of Sri Lanka under the Asian Clearance Union worth several hundred million dollars.
Indian High Commissioner to Sri Lanka said: "These facilities, negotiated and concluded within a matter of weeks, have proved to be the lifeline for the people of Sri Lanka at a time when financing of imports by Sri Lanka is difficult due to the balance of payment situation."
"India's prompt assistance for the people of Sri Lanka at this hour has been appreciated by all sections of the Sri Lankan society" the Indian high commissioner to Sri Lanka added.
India on Saturday delivered 40,000 MT of diesel to Sri Lanka to help ease the power crisis in the island country which is witnessing acute power cuts.
A part of the US 500 million oil line of credit (LoC) extended by India to Sri Lanka, this is the fourth consignment of fuel delivered from India to Sri Lanka under the LoC. Further, India has supplied around 200,000 MT of fuel to the island nation over the last 50 days.
Sri Lanka's economy has been in a free fall since the COVID-19 pandemic due to the crash of the tourism sector.
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