Sri Lanka’s finance minister said on Friday that India and the World Bank are mulling a $2 billion bridge loan to keep imports flowing.
Due to a rapid decline in foreign exchange reserves and the resulting depreciation of the currency and subsequent rise in inflation, the 22 million-person country is having difficulty paying for imports.
As a result of protracted power outages and gasoline and medical shortages, Sri Lanka is working on a bigger strategy to gather cash to aid it through its greatest economic crisis.
The government has asked some creditors to restructure its debt and also approached China, Japan, and the Asian Development Bank amongst others for help, Ali Sabry said.
India has already agreed to double a $500 million fuel credit line and delay almost $1.5 billion in import payments due to the Asian Clearing Union. This includes a $400 million swap from January, the Indian High Commission stated Friday.
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