The US Ambassador to Sri Lanka Julie Chung says that she is pleased to see India confirm strong support for Sri Lanka’s prospective Extended Fund Facility (EFF) program with the IMF and commitment to providing debt relief transparently, in coordination with the Paris Club.
In a Twitter message, the US Ambassador Chung also mentioned that the US stands ready to assist Sri Lanka to unlock IMF assistance when all creditors agree to fair and equitable treatment.
“Pleased to see India confirm strong support for SL’s prospective EFF program & commit to providing financing/debt relief transparently & in coordination w Paris Club. The US stands ready to assist SL to unlock IMF assistance when all creditors agree to fair & equitable treatment”, she tweeted.
India had told the IMF that it strongly supports Sri Lanka’s debt restructuring plan as the island nation seeks a $2.9 billion loan from the global lender.
“We hereby confirm our strong support for Sri Lanka’s prospective (loan) program and commit to supporting Sri Lanka with financing/debt relief consistent with restoring Sri Lanka’s public debt sustainability,” Indian finance ministry official Rajat Kumar Mishra told the IMF chief in a letter dated January 16, 2023.
Sri Lanka requires the backing of China and India - its biggest bilateral lenders - to reach a final agreement with the IMF on the $2.9 billion loan that is essential to help the country emerge from its worst financial crisis in seven decades, the foreign media said on Wednesday.
Sri Lanka reportedly owes India around $1 billion that will come under the debt restructuring plan, according to sources.
New Delhi separately provided Sri Lanka with about $4 billion in rapid assistance between January and July last year, including credit lines, a currency swap arrangement and deferred import payments.
Sri Lanka owed Chinese lenders $7.4 billion - nearly a fifth of its public external debt - by the end of last year, according to calculations by the China Africa Research Initiative (CARI).
--With inputs from agencies
