Sri Lanka has requested India to extend the facilities of its currency swap agreement, provided in March this year.
The agreement, worth $400mn, was valid for three years, however Finance Minister Ravi Karunanayake said that Sri Lanka will have to manage its reserves wisely as China is planning to devalue its currency against the dollar while the USA’s Federal Reserve was planning to raise its interest rates.
Mr Karunanayake however said that Sri Lanka’s foreign reserves are safe and said that the government would do its utmost to see that the country’s foreign reserves are safe in the face of any global crisis, the Daily Mirror reported.
Reserve Bank of India in $1.1bn currency swap deal with Sri Lanka (17 July 2015)
Reserve Bank of India signs currency swap agreement with Sri Lanka (31 March 2015)