India-Sri Lanka ministerial meet on the cards

India and Sri Lanka are beginning high-level consultations, including a proposed meeting between their ministers next week, to assist Colombo in overcoming its worst economic crisis since independence.

Newly-appointed Sri Lanka finance minister Ali Sabry is expected to meet an Indian ministerial delegation in Washington next week, on the sidelines of the International Monetary Fund (IMF) meetings, to firm up a fresh round of assistance from New Delhi, ET has learnt.

Simultaneously, Sri Lanka's presidential advisory group on multilateral engagement and debt sustainability, its Central Bank governor and treasury secretary are engaged in discussions with India, which is being represented by the Chief Economic Adviser and the economic affairs secretary, ET has further learnt.


The two sides could establish a framework to monitor progress of economic cooperation between the two countries in the present context, according to some Sri Lankan officials.

Sri Lanka has sought $2 billion worth of assistance from India, over and above the $2.5 billion extended recently. On Tuesday, a consignment of 11,000 mt of rice from India arrived at the island nation, following 5,000 mt already received through the line of credit.

Sri Lanka has also urged restructuring of some assistance provided by India in the form of credits for essential commodities and fuel, as well as balance of payment support, sources said.

On Tuesday, Sri Lanka announced a preemptive default on all its foreign debt, totalling $51 billion. The government is taking "emergency measures" pending full discussions with IMF, from which it has sought help, only to prevent a further deterioration of the country's financial position, Sri Lanka's finance ministry said. A comprehensive debt restructuring programme was now "inescapable," it noted in a statement.