Sunday, February 5, 2023

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India pledges its commitment to boost investment flows to Sri Lanka

The visiting External Affairs Minister S.Jaishankar has pledged to boost Indian investment flows when he held talks with his Sri Lankan counterpart Ali Sabry soon after his arrival in Colombo.

Their discussion has focused on the cooperation between India and Sri Lanka in the fields of infrastructure, connectivity, energy, industry and health.

The Indian Foreign Minister’s visit comes at a time when India informed the IMF of its assurance which the global lender wants from creditors for providing a much-needed bailout to the cash-strapped island nation.

Sri Lanka, which is trying to secure a US $2.9 billion bailout loan from the International Monetary Fund (IMF), was negotiating to get financial assurances from its major creditors – China, Japan and India – which is the requisite for Colombo to get the bailout package.

The IMF bailout has been put on a halt as Sri Lanka pursues talks with creditors to meet the global lender’s condition for the facility. Jaishankar, who arrived here from the Maldives on the second leg of his two-nation tour, met Sabry and discussed issues of mutual and regional interests, sources said.

He also called on President Ranil Wickremesinghe, who hosted a working dinner for the minister.

Sri Lanka’s unprecedented economic crisis had paradoxically brought the best out of India’s concerns for its southern neighbour given the island nations’ proximity in economic cooperation with China until then.

When the crisis started to hit the country a year ago, India came forward with assistance worth $4 billion.

On Tuesday, President Wickremesinghe told Parliament that his government has “successfully” completed its debt restructuring talks with India.

India’s Additional Secretary of the Finance Ministry Rajat Kumar Mishra on Tuesday informed IMF chief Kristalina Georgiva that New Delhi has confirmed its support to Sri Lanka on the issue of debt restructuring. Last week, Sri Lanka completed its debt restructuring talks with Japan.

Sri Lanka began debt restructuring talks with its creditors in September last year as warranted by its agreement with the IMF for the $2.9 billion facility over four years.

It began negotiating with the IMF for a bail-out after having announced its first-ever sovereign debt default in April last year.

The IMF facility would enable the island nation to obtain bridging finance from markets and other lending institutions such as the ADB and the World Bank.

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