India gets bigger for SL with a fresh $ 1 b loan

India gets bigger for SL with a fresh $ 1 b loan- BPN TODAY
  • Minister Rajapaksa and India’s Foreign Minister Jaishankar and Finance Minister Sitharaman witness signing of a short-term concessional loan facility of $ 1 b
  • Funds channelled via the State Bank of India will be for the import of food, medicines and other essential items
  • India agrees to set up a framework for short, medium and long-term cooperation aimed at addressing Sri Lanka’s present economic challenges
  • A coordinating mechanism consisting of senior officials from two countries to maintain regular dialogue

India’s support for Sri Lanka expanded by a further $ 1 billion yesterday when the two countries signed a fresh loan whilst agreeing to a new master framework to further enhance bilateral cooperation.

The short-term concessional loan facility of $ 1 billion extended by the Indian Government through the State Bank of India (SBI), will help Sri Lanka to ease the severe pressure on scarce foreign reserves to import food, medicines and other essential items. 

The fresh loan in New Delhi was the high point of Finance Minister Basil Rajapaksa’s two-day visit to India.

He along with India’s External Affairs Minister Dr. S. Jaishankar and Finance Minister Nirmala Sitharaman witnessed the signing of the agreement between Treasury Secretary S.R. Attygalle and SBI Deputy General Manager Pushkar Jha.

SBI Managing Director Ashwini Kumar Tewari and General Manager I Vinod Kumar were also present

The $ 1 billion loan facility is part of the key component of the four-pillar economic cooperation arrangement agreed between India and Sri Lanka during Minister Rajapaksa’s visit to New Delhi in December last year.

India’s total development portfolio in Sri Lanka by the end of last year was over $3.5 billion, of which around $ 570 million are purely grant projects.

Prior to the signing ceremony, Minister Rajapaksa was received jointly by India’s Finance and External Affairs Ministers for bilateral talks at the Finance Ministry in the North Block.

During the bilateral talks, the two sides agreed to set up a framework for short, medium and long-term economic cooperation between the two countries aimed at addressing Sri Lanka’s present economic challenges.

With this objective, the three Ministers agreed to stay in regular contact and a coordinating mechanism consisting of senior officials from the two countries was set up to maintain a regular dialogue.

Minister Rajapaksa was accompanied to this meeting by Sri Lanka’s High Commissioner to India Milinda Moragoda, Secretary Attygalle and Deputy High Commissioner of Sri Lanka to India Niluka Kadurugamuwa.

Minister Rajapaksa also met with India’s Minister of Power and New and Renewable Energy Raj Kumar Singh yesterday and discussed the ways and means to further deepen and broaden bilateral cooperation in the power and renewable energy sector. Chief Economic Adviser of the Government of India Prof. A. Nageswaran also called on Rajapaksa.

On Wednesday Prime Minister Narendra Modi met Rajapaksa and reassured them that India would always stand with Sri Lanka as a close friendly neighbour. Rajapaksa thanked Prime Minister Modi for all the assistance that India has provided to Sri Lanka at this critical time. Modi assured the Minister that India would always stand with Sri Lanka, a close friend.

They discussed a wide range of issues pertaining to the bilateral relationship during the call. The areas of discussion included agriculture, renewable energy, digitalisation, tourism and fisheries among others.

The Prime Minister and the Minister discussed Sri Lanka’s decision to move towards organic agriculture. Prime Minister Modi highlighted the advantages of natural farming and India’s experience in developing related techniques and products, including nano-fertilizers, which could be of relevance to Sri Lanka.

They also agreed that cooperation in the development of renewable energy in Sri Lanka is mutually beneficial and that it should be pursued with vigour.

With reference to India’s expertise in unique digital identity and the proposal for bilateral cooperation for the Government of Sri Lanka’s similar program, it was stressed that such identity could serve as a platform for providing common people with access to various services.

The significance of promoting the Ramayana trail in Sri Lanka and the Buddhist circuit in India, including in Gujarat, was highlighted for attracting a large number of Indian tourists to Sri Lanka. In this context, a specific reference was made to the MoU on tourism, signed between Sri Lanka and the State of Gujarat in 2009, which could serve as a template to promote tourism at the state level.

Prime Minister Modi and Minister Rajapaksa had a comprehensive discussion on the fisheries issue between the two countries and recognised its complex and multidimensional aspects including humane treatment of fishermen, livelihood, enforcement, ecology of the ocean, early release of arrested fishermen and their boats, etc. The two dignitaries also agreed on the urgent need to find a lasting solution to this complex issue.

Source Daily FT

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