India, Sri Lanka hold talks on currency swap | Daily News

India, Sri Lanka hold talks on currency swap

India and Sri Lanka are holding high-level talks on rescheduling the repayment of loans and the US$ 1.1 billion currency swap request to abate the economic impact of COVID-19 crisis.

A spokesperson for the Indian High Commission in Sri Lanka said: “Under India-Sri Lanka discussions in the context of the situation concerning Sri Lankan economy’s external sector, the two countries have been engaged in close and constructive talks on rescheduling Sri Lanka’s repayment to India, and on currency swap under bilateral and SAARC arrangements.” 

Indian High Commissioner to Sri Lanka Gopal Baglay has held discussions at the senior level in Colombo on Sri Lanka’s requirements. The statement said, “In the post-COVID world, India remains committed to partner Sri Lanka closely for the latter’s sustained economic recovery and shared prosperity.”

The matter was raised at the leadership level during Prime Minister Narendra Modi’s telephone conversation with Sri Lankan President Gotabaya Rajapaksa on May 23, where the Sri Lankan President requested the Indian Government to provide a US$ 1.1 billion special SWAP facility to top up the US$ 400 million negotiated under a SAARC Facility.

This facility would boost the country’s draining foreign exchange reserves in view of the economic slowdown due to the Coronavirus pandemic. Amidst the economic woes triggered by the Coronavirus pandemic, Sri Lanka has opted to seek help from India through currency swap arrangements. The Indian statement said: “The Prime Minister assured the Sri Lankan President that India would continue to provide all possible support to Sri Lanka for mitigating the effects of the pandemic.”

President Gotabaya Rajapaksa has also sought Indian help to revive key infrastructure projects in the Indian Ocean Island country, including hastening up the construction of the East Terminal of the Colombo Port.

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