LNP – India working on economic aid package for Sri Lanka: reports

India is working out a package on an urgent basis to assist Sri Lanka, following Sri Lanka Finance Minister Basil Rajapaksa’s New Delhi visit that focussed on measures to tide over an economic crisis that the island nation is facing, The Economic Times reported.

Quoting officials, The Economic Times said India is expected to extend a food and health security package to Sri Lanka on an urgent basis, along with an energy security package and currency swap, and also push Indian investments.

It was agreed during Sri Lankan finance minister’s visit that the procedures to realise these objectives would be finalised early, within a mutually agreed time. The food and health security package would envisage the extension of a line of credit to cover the import of food, medicines and other essential items from India.

Meanwhile, the energy package would also comprise a line of credit to cover import of fuel from India, and an early modernisation of Trincomalee Oil Tank Farm. There is also an offer of a currency swap to help Sri Lanka address its current balance of payment issues, the officials said.

It was also decided to facilitate Indian investments in different sectors in Sri Lanka that would contribute to growth and expand employment. Finance Minister Rajapaksa, his Indian counterpart Nirmala Sitharaman and Foreign Minister S. Jaishankar have agreed to open direct lines of communication and to be in direct and regular contact with each other in order to coordinate delivery of the package.

Finance Minister Rajapaksa has briefed the Indian side of the economic situation in Sri Lanka and his government’s approach to addressing post-COVID challenges.

During the two-day visit, Minister Rajapaksa had two rounds of joint discussions with Sitharaman and Jaishankar. He also met with the minister for petroleum & natural gas Hardeep Singh Puri and national security advisor Ajit Kumar Doval.