Sri Lanka Crisis: India becomes Sri Lanka's largest lender, leaves China behind

A media report said that with a total loan of USD 968 million in the four months of 2022, India has emerged as the largest bilateral lender to Sri Lanka, overtaking China in the process. 

China disbursed 947 million US dollars The Daily Financial Times (FT) reported, 'In the last five years from 2017-2021, China has been the largest bilateral lender to Sri Lanka as China disbursed US$947 million, of which US$809 million from the China Development Bank to the market. was received as a loan.'

India gave 377 US dollars

According to the Daily FT, the Asian Development Bank (ADB) has been the largest multilateral lender in the last five years and disbursed an amount of USD 610 million in 2021. At the same time, India has disbursed USD 377 million and ADB has disbursed USD 360 million, which is 76 percent of the total disbursements in the first four months of 2022.

India gave 4 billion US dollars to Sri Lanka Meanwhile, in the annual joint debate of the United Nations General Assembly on the report of the Peace Building Commission (PBC) and the Peace building Fund (PBF), India's Permanent Representative to the United Nations Ruchira Kamboj said that India has given Sri Lanka about US$ 4 billion. Food and financial assistance provided. 

“In our immediate neighbourhood, we have been providing food and financial assistance of about US$ 4 billion to our good friend and neighbor Sri Lanka to ensure food security during the last few months,” Kamboj said.

21000 tonnes of fertilizers handed over to Sri Lanka

On 22 August, India handed over 21,000 tonnes of fertilizers to beleaguered neighbor Sri Lanka. "Extending the aroma of friendship and cooperation, the High Commissioner formally supplied 21,000 tonnes of fertilizers supplied under India's special support to the people of Sri Lanka," the Indian High Commission in Colombo, Sri Lanka said. 

The High Commission of India further said, 'This follows 44,000 tonnes supplied last month under Indian support of around US$ 4 billion in 2022. It reflects the close relations with India and the mutual trust and goodwill between India and Sri Lanka to the people benefiting. 

India at the fore

India has been at the forefront of providing financial assistance to Sri Lanka as per their requirements and is one of the countries which has provided maximum assistance in times of need.

Sri Lanka facing severe economic crisis

Since the beginning of 2022, Sri Lanka has experienced a growing economic crisis and the government has defaulted on its foreign loans. Sri Lanka is battling a severe economic crisis with food and fuel shortages affecting a large number of people in the island nation. The economy is in a free fall since the start of the COVID-19 pandemic.

Shortage of foreign exchange near Sri Lanka

Sri Lanka is also facing a foreign exchange crunch, which has affected its ability to import food and fuel, leading to power cuts in the country. The shortage of essential commodities forced Sri Lanka to seek aid from friendly countries.