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Indian Lines of Credit for food, medicine and fuel imports

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Finance Minister Basil Rajapaksa ended his first official visit to India on a successful note yesterday, securing an agreement for an extension of a Line of Credit to cover the import of food, medicines and other essential items from India to Sri Lanka.

The visit also resulted in an “Energy Security Package” that would include a Line of Credit to cover the import of fuel from India, and an early modernization of Trincomalee Tank Farm. An offer of a Currency Swap to help Sri Lanka address the current balance of payment issues was also on the table.

All these decisions were arrived at following discussions with the Minister’s Indian counterpart Finance and Corporate Affairs Minister Nirmala Sitharaman and External Affairs Minister Dr. S. Jaishankar. During his two-day visit, Minister Rajapaksa also met Petroleum and Natural Gas Minister Hardeep Singh Puri and National Security Advisor of India Ajit Kumar Doval for bilateral talks.

The Sri Lankan Finance Minister’s discussions with his Indian counterpart and the External Affairs Minister focused on a whole gamut of issues of mutual importance pertaining to the bilateral relationship with particular attention on the economic cooperation aspect. Both sides expressed satisfaction over the evolving trajectory of the bilateral relationship. During the discussions, they identified ways and means through which the existing bilateral economic relationship between the two countries could be further broadened and deepened. The Minister also discussed facilitating Indian investments in different sectors in Sri Lanka that would contribute to growth and expand employment. This will build on recent trends in that respect.

Finance Minister Rajapaksa briefed the Indian side of the economic situation in Sri Lanka and the Government’s approach to addressing post-Covid challenges.

The Indian Ministers expressed India’s solidarity with Sri Lanka at this juncture.They reiterated that India has always stood by Sri Lanka and in the current situation would be guided by its Neighbourhood First policy.

It was agreed that modalities to realize these objectives would be finalized early, within a mutually agreed timeline. Minister Rajapaksa and Ministers Sitharaman and Jaishankar agreed to open direct lines of communication and to be in direct and regular contact with each other in order to coordinate the above initiative.The Minister and his delegation which included Sri Lanka’s High Commissioner to India Milinda Moragoda thanked the Indian delegations for all the arrangements made to facilitate the visit, which was the Finance Minister’s first official visit abroad since assuming duties in July.

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