The debt restructuring covers seven line of credit and four buyers credit facility agreements that were made available to Sri Lanka by the Export- Import Bank (EXIM) of India, the finance ministry statement said.
New Delhi and Colombo have worked to deepen ties as India’s southern neighbour recovers after plunging into financial crisis in 2022. India provided $4 billion in assistance to Sri Lanka to help it weather the tumult including a swap arrangement and other emergency assistance.Read more: Mastercard and LankaPay to enable co-branded debit card and secure QR payments
The crisis left Sri Lanka struggling to pay for fuel, medicine and cooking gas. A $2.9 billion bailout from the International Monetary Fund (IMF), which approved the fourth review of its program last month, has played a critical role in Sri Lanka’s post-crisis recovery.
Sri Lanka finalised a deal with Japan, another key creditor in March to restructure $2.5 billion in debt after entering into a preliminary deal with key bilateral lenders last June.
It still needs to sign similar agreements with China for about $4.75 billion in debt. Colombo also secured a deal to restructure $12.5 billion of its debt with international bondholders last December.
