According to India, the country would keep helping Sri Lanka get out of its financial problems

India has once again expressed its desire to play “a constructive role” in aiding Sri Lanka’s attempts to emerge from the greatest economic catastrophe.

Vinod K. Jacob, India’s deputy high commissioner, said at the opening ceremony of the Construction, Power and Energy Expo 2023 in Colombo on Friday that recent advances in India-Sri Lanka relations have reinforced their friendship and general cooperation.

“In January of this year, we were the first creditor country to deliver the finance guarantees required to launch the IMF procedure. As Co-Chair of the Creditors Committee with Japan and the Paris Club, India would continue to contribute positively, he added.

India was the first nation to provide its letter of support to the International Monetary Fund (IMF) for the funding and debt restructuring of Sri Lanka in January of this year.

An official creditor committee, co-chaired by India, Japan, and France, was established in May of this year by 17 nations that had provided loans to Sri Lanka. The group’s purpose was to consider Sri Lanka’s request for debt treatment.

Officials from important creditor nations work together as the Paris Club to develop coordinated and long-term solutions to the payment issues faced by debtor nations.

According to Jacob, India has provided Sri Lanka with financial and humanitarian relief of $4 billion, substantially above the projected sum of the IMF’s Extended Fund Facility.

Due to a serious lack of foreign currency reserves, Sri Lanka experienced a devastating financial crisis in 2022—the worst since it gained independence from Britain in 1948.

In accordance with its “Neighbourhood First” policy, India provided the struggling nation with multifaceted aid totaling roughly $4 billion last year, including several credit lines and currency support.

The previous three years have shown how closely connected the people of India and Sri Lanka are, according to Jacob.

According to Jacob, the successful visit to Sri Lanka by External Affairs Minister S. Jaishankar in January of this year opened doors for further collaboration via investments in manufacturing, infrastructure, and connectivity.

“In 2022, India was Sri Lanka’s top commercial partner. Indian imports from Sri Lanka have increased as well. The Sri Lankan economy is further aided by the usage of rupees for trade settlement. These are practical measures to support Sri Lanka’s economic development and recovery, he said.

He said that, with over 100,000 visitors, India was once again Sri Lanka’s top source of visitors.

Indian tourists make up to one in five to six visitors to Sri Lanka.

He praised the restart of flights between Chennai and Jaffna as another step towards improving relations between the two peoples.

Ferry service between the two nations will support this even further. In this situation, connectivity is a force multiplier, he said.