Sri Lanka is seeking a second USD $500 million credit line from India, as an existing credit line is close to finishing.
Sri Lanka has rapidly used up an existing USD $500 million credit line signed from India in Februrary and is now seeking to sign a second USD $500 million credit line from the New Delhi government. As Oil prices rose, USD $375 to USD $400 million of the original credit line will be used by the end of April.
Ceylon Petroleum Corporation Chairman Sumith Wijesinghe told reporters, "We are in discussions with India for an oil credit of another U$500 million dollars,”.
As the country suffers from rolling blackouts, Sri Lanka's worst economic crisis since independence took another nosedive as the finance ministry and governor of the central bank announced that the government would not be able to meet its international debt repayments.
Sri Lanka’s finance ministry announced the government would “suspend normal debt servicing,” adding that "the government is taking the emergency measure only as a last resort in order to prevent further deterioration of the republic's financial position".
According to the statement, the failure to pay will be on all "affected debts," citing bonds issued in international capital markets, bilateral credits, and foreign loans. The total amount is thought to be approximately US$51 billion. Falling foreign reserves has impacted the imports of vital items like fuel, medicine and food.
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