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Sri Lanka requests India for currency swap arrangement of up to $1.1 billion

IndoCarib

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Sri Lanka has requested India for a currency swap arrangement to the tune of $1.1 billion to ease pressures related to foreign currency reserves — seen as a fallout of the covid-19 pandemic devastating the tourism industry in the island nation.

This new request of $1.1 billion is separate from another for $ 400 million being negotiated between the two countries under the South Asian Association for Regional Cooperation (SAARC) framework.

Sri Lankan President Gotabaya Rajapaksa put forth the request during a telephone conversation with Indian Prime Minister Narendra Modi on Saturday, a statement from Rajapaksa’s office said. The conversation was described as “very constructive and cordial."

“If the Government of India could provide $ 1.1 billion special SWAP facility to top up $ 400 million under SAARC Facility, it would enormously help Sri Lanka in dealing with our foreign exchange issues," the statement from Rajapaksa’s office quoting the president said.

Sri Lanka’s economy has been hit by the novel coronavirus crisis with tourism — a major foriegn currency earner — drying up completely with the embargos on travel. India has been negotiating a currency swap agreement with Sri Lanka for $ 400 million. There was no mention of the new request in a read out of the conversation put out by the Indian side on Saturday. It comes in the wake of India’s strategic rival China moving with a $ 500 million loan offer from it’s central bank at reduced interest rates.

China is already one of the biggest investors in various infrastructure projects in Sri Lanka. But there has been criticism, both locally and internationally, and growing concerns that China has lured Sri Lanka into a debt trap. So far India has sent consignments of medicines to Sri Lanka as donation— something Rajapaksa thanked Modi for in his conversation on Saturday.

https://www.livemint.com/news/india...ment-of-up-to-1-1-billion-11590252888557.html
 

GHALIB

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Sri Lanka has requested India for a currency swap arrangement to the tune of $1.1 billion to ease pressures related to foreign currency reserves — seen as a fallout of the covid-19 pandemic devastating the tourism industry in the island nation.

This new request of $1.1 billion is separate from another for $ 400 million being negotiated between the two countries under the South Asian Association for Regional Cooperation (SAARC) framework.

Sri Lankan President Gotabaya Rajapaksa put forth the request during a telephone conversation with Indian Prime Minister Narendra Modi on Saturday, a statement from Rajapaksa’s office said. The conversation was described as “very constructive and cordial."

“If the Government of India could provide $ 1.1 billion special SWAP facility to top up $ 400 million under SAARC Facility, it would enormously help Sri Lanka in dealing with our foreign exchange issues," the statement from Rajapaksa’s office quoting the president said.

Sri Lanka’s economy has been hit by the novel coronavirus crisis with tourism — a major foriegn currency earner — drying up completely with the embargos on travel. India has been negotiating a currency swap agreement with Sri Lanka for $ 400 million. There was no mention of the new request in a read out of the conversation put out by the Indian side on Saturday. It comes in the wake of India’s strategic rival China moving with a $ 500 million loan offer from it’s central bank at reduced interest rates.

China is already one of the biggest investors in various infrastructure projects in Sri Lanka. But there has been criticism, both locally and internationally, and growing concerns that China has lured Sri Lanka into a debt trap. So far India has sent consignments of medicines to Sri Lanka as donation— something Rajapaksa thanked Modi for in his conversation on Saturday.

https://www.livemint.com/news/india...ment-of-up-to-1-1-billion-11590252888557.html

a friend in need is friend indeed . long live SARC.
 

vishwambhar

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If under current circumstances it is possible for India then I wish India must do it.... Sri Lanka is our neighbor and brother.....
 

Chhatrapati

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I don't think it'll be a problem. Sri Lanka is not some LDC - debt-ridden country. It's a High HDI, economically stable nation.
 

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