New Delhi has extended assistance of over USD 3 billion to Sri Lanka in 2022: Indian High Commission

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Photo source: AP

Colombo: Sri Lankans have protested in Colombo, Sri Lanka, demanding the resignation of President Gotabaya Rajapaksa.

India has pledged more than USD dollars in debt, credit lines and credit swaps to debt-ridden Sri Lanka since January this year, the Indian High Commission said here on Tuesday, as the island nation struggles to go through the worst economic crisis since independence. .

On Monday, India increased its current credit line by another 200 200 million to replenish Sri Lanka’s rapidly depleting energy reserves.

The ongoing crisis in Sri Lanka is partly due to a lack of foreign exchange, which means the country cannot afford to import major food and fuel imports, leading to severe shortages and very high prices. “A credit facility of USD 1 billion for the purchase of food, medicine and other essential commodities is already in operation,” the Indian High Commission said in a statement, adding that about 16,000 metric tonnes of rice supplied by India was also being distributed.

Additional shipments of rice, pharmaceuticals and industrial raw materials and other essentials are planned under the credit line, the statement added.

“A separate line of credit of USD 500 million for the purchase of petroleum products such as diesel, petrol and aviation fuel has paved the way for the supply of nine shipments of different types of fuel,” it said.

In April this year, before the Sinhala and Tamil New Year, India sent an additional 11,000 metric tons of rice as a token of goodwill.

In February, New Delhi sanctioned USD 500 billion as a short-term loan to Sri Lanka for the collection of fuel reserves.

“About 400,000 metric tons of fuel have been supplied to date and more shipments will arrive soon,” the statement added.

Last month, India responded to a call from a Sri Lankan hospital for emergency medical supplies by delivering a large consignment of vital drugs with the help of an Indian Navy ship.

Overall financial support that in the shadow of USD 3 billion in 2022 alone is in various forms – USD 1 billion credit line for essentials; USD 500 million credit line for purchasing petroleum products; USD 400 million bilateral currency exchange; And more than বিল 1 billion under the Asian Clearing Union Framework.

The Sri Lankan government has said it will temporarily default on 35 35.5 billion in foreign debt because the epidemic and the war in Ukraine have made it impossible for foreign lenders to repay.

The government in Gotabaya Rajapaksa has also called for a bailout of the International Monetary Fund, which could take up to three months to arrive. According to data released by the government’s Office of Census and Statistics, overall inflation rose to 29.8 percent in April from 18.7 percent in March.

Food inflation rose to 46.6 percent in April from 30.21 percent in March.

Prices of most food items have gone up.

Month-long blackouts and severe shortages of food, fuel and medicine have sparked widespread protests demanding the government’s resignation.

Also read | The President of Sri Lanka is ready to form an interim government, claims a senior Buddhist monk

Also read | Adequate fuel, water shortages have led to severe power outages in Sri Lanka

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