Sri Lanka President plans to visit New Delhi to discuss his country's economic crisis

Ranil Wickremesinghe met PM Modi briefly in Japan during their visit to Shinzo Abe’s funeral

October 06, 2022 05:21 pm | Updated 05:21 pm IST - Colombo:

Sri Lanka’s President Ranil Wickremesinghe took charge after then president Gotabaya Rajapaksa fled Colombo in the face of the country’s worst economic crisis since 1948. File

Sri Lanka’s President Ranil Wickremesinghe took charge after then president Gotabaya Rajapaksa fled Colombo in the face of the country’s worst economic crisis since 1948. File | Photo Credit: Reuters

Sri Lankan President Ranil Wickremesinghe announced in Parliament on Thursday that he hopes to visit New Delhi to discuss the island nation’s worst economic crisis.

Briefing the House on his recent visits to Japan, Singapore, and the Philippines, the President said, “We are continuing our talks with India. During my brief meeting with Prime Minister Modi in Japan, I conveyed my wish to visit New Delhi to brief them on our situation." The President, who took charge after then president Gotabaya Rajapaksa fled Colombo in the face of the country's worst economic crisis since 1948, said, "(Mr.) Modi has always extended his support to us. I have always appreciated India’s assistance in our crisis. India will continue to extend their support in our rebuilding effort.”

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India since January this year has extended nearly $4 billion worth of assistance to Sri Lanka after the country in April this year announced itself bankrupt and expressed its inability to honour debts.

The island nation has been scrambling for dollars, leading to a shortage of food, medicines as well as essential items.

India’s credit lines to provide essential food and fuel proved a lifeline to Sri Lanka in the early stage of the crisis.

India stands as a key player in Sri Lanka’s debt restructuring process, a prerequisite to the International Monetary Fund (IMF) facility bailout.

Having agreed to a staff-level agreement for a $2.9 billion facility over four years, the IMF has asked Sri Lanka to start debt restructuring with its creditors.

India with 12% is in the third position in the list of Sri Lanka’s bilateral creditors behind China and Japan with 52 and 19%, respectively.

The President also said that Sri Lanka hoped to reach a common agreement with creditor nations including Japan, China, and India, adding that Japan was ready to assist the bankrupt nation in the reconciliation process.

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Mr. Wickremesinghe said that the island nation will only be able to secure an IMF assurance after reaching an agreement with the creditor nations and private lenders.

The President said that Sri Lanka after signing an agreement with creditor nations will be able to access bridging finance with lenders like the World Bank and the Asian Development Bank.

Sri Lanka hopes to access around $1 billion through bridging finance.

The President further said that the Asian Development Bank has agreed to provide $500 million in loans to Sri Lanka.

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