World News | India says it will continue to support Sri Lanka in overcoming financial crisis

COLOMBO, July 9 (Xinhua) — India has reiterated its willingness to play a “constructive role” in supporting Sri Lanka’s efforts to recover from the worst economic crisis.

Speaking at the opening of the Construction, Power and Energy Expo 2023 in Colombo on Friday, Indian Deputy High Commissioner Vinod Jacob said recent developments in India-Sri Lanka relations have strengthened the friendship and comprehensive cooperation between the two countries.

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“We were the first creditor country to provide the financing guarantees needed to start the IMF process in January this year. India will continue to play a constructive role as co-chair of the creditors’ committee, along with Japan and the Paris Club.”

In January this year, India became the first country to submit a letter of support for Sri Lanka’s financing and debt restructuring to the International Monetary Fund (IMF).

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In May, 17 countries that provide loans to Sri Lanka formed an official creditors committee, co-chaired by India, Japan and France, to discuss Sri Lanka’s debt handling requirements.

The Paris Club is a group of officials from major creditor countries whose role is to find coordinated and sustainable solutions to the payment difficulties experienced by debtor countries.

Jacob said that India’s $4 billion in financial and humanitarian support to Sri Lanka far exceeds the expected total of the IMF’s extended fund arrangement.

Due to a severe shortage of foreign exchange reserves, Sri Lanka in 2022 suffered the most catastrophic financial crisis since independence from Britain in 1948.

In line with India’s “periphery first” policy, India last year provided about $4 billion in multi-pronged assistance through multiple credit lines and currency support as the country was in the throes of crisis.

“The past three years have demonstrated the close bond between the people of India and Sri Lanka,” Jacob said.

Jacob said that Foreign Minister Jaishankar Jaishankar’s successful visit to Sri Lanka in January this year opened up avenues for further cooperation between the two sides through investing in infrastructure, manufacturing and promoting connectivity.

“India is Sri Lanka’s largest trading partner in 2022. Sri Lanka’s exports to India have also increased. The use of rupees for trade settlement is further helping Sri Lanka’s economy. These are concrete steps to help Sri Lanka’s economic recovery and growth.” .

He noted that India was once again the largest source of tourists to Sri Lanka last year with more than 100,000 tourists.

“About one out of five to six tourists in Sri Lanka is Indian.”

He hailed the resumption of the Chennai-Jaffna flight as another step in bringing the two peoples closer.

“Ferry services between the two countries will further facilitate this. In this case, connectivity is a force multiplier,” he added.

(This is an unedited and auto-generated story from a syndicated news feed, the latest staff may not have modified or edited the body of content)