ECONOMYNEXT – Sri Lanka Finance Minister Basil Rajapaksa on Wednesday met his Indian counterpart Nirmala Sitharaman in New Delhi discussed steps to deepen economic cooperation with India amid expectations of support for the country’s foreign exchange crisis.
Rajapaksa’s visit comes as Sri Lanka’s foreign reserves have fallen to low levels and liquidity injections to maintain 6.0 percent policy were pushing up imports above dollar receipts raising doubts over the ability to make debt repayments.
The meeting focused on a range of issues pertaining to bilateral economic cooperation and ways and means to improve existing bilateral economic cooperation between the two countries, sources who are aware of the visit said.
Sri Lanka government officials have said that they are in discussion with India for a 500 million US dollar fuel credit and 400 million US dollar swap with the central bank of Sri Lanka.
Sri Lankan government has requested a 1 billion US dollar financial support from India, but chances of it materializing are low, sources said.
Rajapaksa’s visit also comes at a time when the island nation is involved in a controversy with China over a contaminated organic fertilizer consignment, resulting in a diplomatic spat between the two countries.
Sri Lanka has leaned towards China due to its easy loans in the past. (Colombo/Dec01/2021)