As Sri Lanka’s crisis deepened, India gave more help

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Sri Lanka’s cabinet has approved a proposal to get more fuel from India through a short-term loan facility of $200 million from Exim Bank of India, as the island nation struggles to deal with a deepening economic crisis.

“Cabinet approved the proposal submitted by the Minister of Power to provide it” [fuel] contract to Indian Oil Corporation,” said the Department of Government Information.

India has pledged nearly $3 billion in cash-strapped Sri Lanka through currency swaps, credit lines for essential goods and repayment of loans since January 2022 to help Sri Lanka amid one of the worst economic crises in history. extended for.

The $400 million currency swap with the Reserve Bank of India, which was extended earlier this year, was extended for another three months on April 18. A $1 billion line of credit is operational for essential imports and about 16,000 metric tonnes of rice has been supplied so far. India has helped Sri Lanka defer repayment of a total loan of $1 billion under the Asian Clearing Association. In addition, the Indian High Commission in Colombo said that 400,000 metric tonnes of fuel has been delivered to Sri Lanka through a $500 million credit facility. “The multi-pronged assistance provided by India is a testimony to the importance the Government of India attaches to the welfare of the people of Sri Lanka, and the duality of ‘neighbourhood first’ and SAGAR (Security and Development for All in the Region). is guided by principles,” a statement said.

Sri Lanka’s economic crash intensified since the beginning of this year, with the country’s foreign reserves dwindling by barely $2 billion due to an acute balance of payments crisis in recent years.

The crisis manifested in severe shortages of food, fuel and medicines, as the country experienced record inflation, reaching nearly 30% in April. As a result, the popularity of the ruling Rajapaksa administration has plummeted over the past few months, with citizens demanding that President Gotabaya Rajapaksa and Prime Minister Mahinda Rajapaksa resign.

For almost a month, protesters have been protesting every day on the beach in Colombo against the government’s “failed” crisis response. Students, professionals, businessmen, labor unions, and children along with others can be seen raising anti-government slogans at daily rallies. Renowned Sri Lankan artists and scholars, such as Kandian dance exponent Upeka Chitrasena, and senior feminist scholar Kumari Jayawardene took part in the protests this week.

Meanwhile, Sri Lanka’s Ministry of Tourism reported that tourist arrivals in April have almost halved as compared to 1,06,500 arrivals recorded in March. The All Ceylon Tourist Service Providers Association attributed the decline to existing fuel shortages, frequent power cuts and short supplies of medicines to local hospitals. “Some are suggesting that the ongoing public protests can be a deterrent, but it is not. Tourists are very supportive of democratic protest, and there is also a stall for tourists at the agitation site in Colombo,” said association secretary Suranjit Vevita Hindu,