Sri Lanka is likely to miss the December deadline for IMF package due to delay in restructuring of its debt. The IMF package would give 2.9 billion dollars in tranches over a period of four years after Sri Lanka attains debt sustainability.
Talking to reporters last week, Governor of the Central Bank Nandalal Weerasinghe maintained that Sri Lanka has time till January even if it missed december deadline.
Meanwhile, Tamil National Alliance MP Shanakiyan Rasamanickam was critical of China’s stance in Parliament targeting several ‘white elephant’ projects funded by China including Lotus tower and Hambantota port.
Questioning the utility of Chinese investments, he said that the projects did not create any employment opportunities and called for China to assist Sri Lanka in the securing the IMF deal.
The bailout requires the central bank of Sri Lanka to obtain assurances from creditors on restructuring of bilateral debt. China has been the biggest lender followed by India and Japan. India has held three rounds of discussions with the Sri Lankan side.
Earlier this year, the island nation had spiralled into political and economic crisis which saw protesters dislodge the Rajapaksa government. Sri Lanka has since defaulted on the 51 billion dollar foreign debt which was precipitated by plummeting forex reserves.
The country has been facing acute shortages in essential imports of fuel, food, fertiliser and medicines amid serpentine queues. India helped Sri Lanka stay afloat through a generous assistance of over 3.8 billion dollars.
While the IMF bailout deal is yet to be finalised, Sri Lanka is exploring loans from world bank and Asian Development Bank. Former Governor of Central Bank of Sri Lanka, Inderjit Coomaraswamy, said that the island nation is in talks to obtain loans of 1.9 billion dollars from the two banks.
( source News onAir)