Colombo: Sri LankaThe Finance Minister of India said on Friday that its neighboring country India and world Bank Bridges is looking at expanding about $2 billion in finance so it can continue to import essentials.
The country of 22 million people is struggling to pay for imports after a sharp drop in foreign exchange reserves, which has led to currency devaluation and rising inflation.
Sri Lanka, which has an external debt of $51 billion, to secure funds to help it through its worst economic crisis caused by prolonged power cuts and nationwide protests over a lack of fuel and medicines Working on a comprehensive plan.
The government has asked some creditors to restructure their debt and has also approached China, Japan and the Asian Development Bank for help, Ali Sabari said.
India has already agreed to double the existing $500 million line of credit for fuel and defer nearly $1.5 billion in import payments that Sri Lanka needs to make to the Asian Clearing Association. The Indian High Commission on Friday said it has also extended the tenure of the $400 million swap awarded in January.
“The talks with the World Bank have also been very positive,” Sabri said, adding that “over the next four weeks to six months we expect about $500 million from them, partly used to provide direct cash transfers to the poor.” Will be done.”
Sabri is leading a Sri Lankan delegation to hold talks on an event in Washington International Monetary Fund (IMF). He said talks on an Extended Funds Facility (EFF) had begun, but Sri Lanka needed $3 billion to $4 billion in bridge financing by the time a program was finalised.
“We have a three-pronged strategy. One is to take the IMF program forward, the second is to secure bridge financing and the third is to put Sri Lanka back on the growth path in a year or so,” he said.
Sabri said the government expects to appoint financial advisors and an international law firm to begin formal debt negotiations with creditors in the next 10 to 15 days.
The country of 22 million people is struggling to pay for imports after a sharp drop in foreign exchange reserves, which has led to currency devaluation and rising inflation.
Sri Lanka, which has an external debt of $51 billion, to secure funds to help it through its worst economic crisis caused by prolonged power cuts and nationwide protests over a lack of fuel and medicines Working on a comprehensive plan.
The government has asked some creditors to restructure their debt and has also approached China, Japan and the Asian Development Bank for help, Ali Sabari said.
India has already agreed to double the existing $500 million line of credit for fuel and defer nearly $1.5 billion in import payments that Sri Lanka needs to make to the Asian Clearing Association. The Indian High Commission on Friday said it has also extended the tenure of the $400 million swap awarded in January.
“The talks with the World Bank have also been very positive,” Sabri said, adding that “over the next four weeks to six months we expect about $500 million from them, partly used to provide direct cash transfers to the poor.” Will be done.”
Sabri is leading a Sri Lankan delegation to hold talks on an event in Washington International Monetary Fund (IMF). He said talks on an Extended Funds Facility (EFF) had begun, but Sri Lanka needed $3 billion to $4 billion in bridge financing by the time a program was finalised.
“We have a three-pronged strategy. One is to take the IMF program forward, the second is to secure bridge financing and the third is to put Sri Lanka back on the growth path in a year or so,” he said.
Sabri said the government expects to appoint financial advisors and an international law firm to begin formal debt negotiations with creditors in the next 10 to 15 days.