India willing to support crisis-laden Sri Lanka's economic recovery

| Updated: June 27, 2022 22:52:57

India willing to support crisis-laden Sri Lanka's economic recovery

India's top diplomat held talks with Sri Lanka's president and prime minister on Thursday as India signalled its willingness to go beyond the $4 billion in loans, swaps and aid that it has already provided its cash-strapped neighbour, news agency Reuters reported. 

Sri Lanka is facing its worst economic crisis in seven decades, with a severe foreign exchange shortage hampering the import of essentials including food, fuel and medicines.

The island nation off the tip of southeast India needs about $5 billion in the next six months to cover basic necessities for its 22 million people, who have been struggling with long queues, worsening shortages and power cuts.

Indian Foreign Secretary Vinay Kwatra, accompanied by finance ministry officials, held talks with President Gotabaya Rajapaksa and Prime Minister Ranil Wickremesinghe in the commercial capital Colombo, officials said.

"Underlined India stands ready to help Sri Lanka in quick economic recovery through promoting investments, connectivity and strengthening economic linkages," Indian Foreign Ministry spokesman Arindam Bagchi said on Twitter.

The Indian team held a separate meeting with Wickremesinghe, the Central Bank governor and finance ministry officials, an official from the prime minister's office said.

"The delegation will also hold discussions with senior officials on the economic situation in the country and the short-term and long-term assistance requirements," Sri Lanka's foreign ministry said in a statement.

India has been the principal source of foreign assistance to Sri Lanka this year, supplying more than $4 billion, Wickremesinghe told parliament this week.

The neighbours are also in talks for additional support including a $500 million credit line for fuel and help with importing fertiliser and rice as Sri Lanka attempts to stave off a food crisis, officials said.

Sri Lanka plans to hold a donor conference with China, India and Japan, Wickremesinghe said, as it continues talks with the International Monetary Fund for a bailout package of about $3 billion.

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