Sri Lanka Economic Crisis
India extends duration of currency swap facility of $400 million for Sri Lanka
Colombo: India has extended the duration of the USD 400 million currency swap facility, which had ended in January, for Sri Lanka amid its worst economic crisis.
This is the first extension of an international debt instrument to Sri Lanka after the cash-strapped island nation led by President Gotabaya Rajapaksa on April 12 temporarily suspended debt servicing.
The Sri Lankan government announced an orderly default until the country came to an agreement with the International Monetary Fund
(IMF) for a possible bailout package.
"India's unstinted and multi-faceted support to Sri Lanka continued.As ongoing currency support, @RBI extended the duration of the US$ 400million currency swap for @CBSL which was concluded in #January this year," the High Commission of India said on Twitter.
#India's unstinted and multi-faceted support to #Srilanka continued. As ongoing currency support, @RBI extended the duration of the US$ 400 million currency swap for @CBSL which was concluded in #January this year. pic.twitter.com/FCp7mKZaNV
— India in Sri Lanka (@IndiainSL) April 22, 2022
The Reserve Bank of India (RBI) signed the currency swap agreement with the Central Bank of Sri Lanka under the SAARC Currency Swap Framework 2019-22.
Under the agreement, the Central Bank of Sri Lanka can make drawals of US Dollar, Euro or Indian Rupee in multiple tranches up to a maximum of USD 400 million or its equivalent.
Sri Lanka had also drawn on Indian credit lines worth USD 1 billion for essential imports and separate ones for the importation of fuel.
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