Finance Minister Basil Rajapaksa is to lead a delegation to the ‘Vibrant Gujarat’ summit to be held from January 10 to 12, official sources said. He is likely to hold talks with Prime Minister Narendra Modi during this visit, his second to India in about a month.
The Minister — the youngest brother of Sri Lanka’s ruling clan and an influential politician — would travel to India a day after Chinese Foreign Minister Wang Yi concludes his two-day visit to the island nation, signalling Colombo’s intensive engagement with both New Delhi and Beijing at a time when it faces one of its worst economic meltdowns in history.
Mr. Basil Rajapaksa was in New Delhi from November 30 to December 2. Despite officials indicating that he was scheduled to call on Mr. Modi, the meeting did not take place, reportedly due to scheduling issues – something that Sri Lankan media highlighted prominently in their coverage of the high-profile visit.
He, however, held talks with External Affairs Minister S. Jaishankar and Finance Minister Nirmala Sitharaman. They drew up a “four pillar” initiative, as part of which India agreed to extend emergency Lines of Credit for import of food, medicines and fuel, and a currency swap to help the island nation tide over its relentless dollar crisis.
Sri Lanka’s external reserves stood at $3.1 billion at year-end, the Central Bank of Sri Lanka said on Wednesday — an increase from the $1.6 billion reported last month — although some have challenged the claim, asking if the bank was including the $1.5 billion currency swap cleared by China earlier this year.
Colombo-based think tank Pathfinder Foundation has warned of a “a very real possibility of a sovereign debt default” next year, citing the $ 1 billion due in debt-service payment in January 2022, and a total $ 7 billion to be served through the next year.
American credit rating agency Fitch on December 17 downgraded Sri Lanka to ‘CC’ rating, the lowest before default.
Courtesy: The Hindu
