New Delhi: Looking to further step up “critical support” for Sri Lanka, which is battling an acute shortage of foreign exchange, India has offered a new line of credit (LoC) of $500 million to the island neighbour for purchase of petroleum products. Foreign minister S Jaishankar made the offer in a letter to his counterpart GL Peiris, said the Indian high commission in Colombo in a statement.
India had recently also extended foreign exchange support of over $900 million to Sri Lanka for import of essential items like food and medicines.
Early operationalisation of the LoC, said the Indian government, will help realise one of the four pillars of economic cooperation identified during the visit of Lankan finance minister Basil Rajapaksa to India in December 2021. These four pillars include a food and health security package, energy security package, offer of a ‘currency swap’ to help Sri Lanka address the current balance of payment issues and facilitating Indian investments in different sectors in Sri Lanka that would contribute to growth and expand employment.
In a virtual meeting with Jaishankar recently, Basil had welcomed Indian investments in Sri Lanka in a number of important spheres including ports, infrastructure, energy, renewable energy, and assured that conducive environment will be provided for such investments.
