India Extends USD 1 Billion Credit Line to Sri Lanka for another Year

India Extends USD 1 Billion Credit Line to Sri Lanka for another Year

India has extended the $1 billion credit facility to Sri Lanka for another year.

The State Bank of India (SBI) and the Sri Lankan government signed an agreement in March last year at the height of the country’s economic crisis. India on May 30 extended its $1 billion credit line to Sri Lanka to help the island nation hit hard by an extraordinary economic crisis to acquire food, medicine and other essential items. Since last year, the credit facility has been used for urgent procurement of fuel, medicine, food items and industrial raw materials, as per the requirements and priorities of Sri Lanka.

“India reaffirms its commitment to the people of Sri Lanka. The Amendment Agreement signed in presence of Honourable Minister @ShehanSema today will enable Sri Lanka to use the $1 billion Indian credit facility for the procurement of medicine, food, and other essentials for one more year,” the Indian High Commission in Sri Lanka tweeted.

India extended multi-pronged assistance of about $4 billion to Sri Lanka last year, through multiple credit lines and currency support, in line with India’s ‘Neighbourhood First’ policy.

Meanwhile, Sri Lanka also announced on May 30 that it has commenced the preliminary work to resume the abandoned Japan-funded Light Rail Transit project.