Sri Lanka has called on India to grant a three year grace period in repayment of debt to its giant neighbour, Indian media reported.
The island nation is currently facing a mammoth challenge in the form of domestic and foreign debt of US $60 billion, under which the Sri Lankan economy is currently reeling with debts to India ballooned up to US$8.4 billion.
Prime Minister Mahinda Rajapaksa told the“The Hindu” newspaper that he requested the Indian government to stall the period of repaying the debt owed to India by three years.
He further noted that the request to extend the debt repayable period was until the economy of the country is reviewed, while also saying that if India does this favour for Sri Lanka that other countries including China will agree for the same.
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“This is something we discussed with the Indian government as well, and have asked if we could get a moratorium on all loan repayments for three years, until we can revive the economy.
The previous government took so many loans, they beggared the economy, and it is a mess. It all depends on the stand India takes, he added.
The government has to pay about $ 5 billion to service the massive debt in Sri Lankan history
Prime Minister Mahinda Rajapaksa said that they have to do it, and government will manage somehow. We don’t want to default on our debt no matter what happens, he said.
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