India India - Sri Lanka Relations

Nilgiri

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Amid a severe fuel crisis,Sri lanka has asked for a 500 million dollar loan from India to pay for its crude oil purchases. This comes a few days after the Sri Lankan energy minister Udaya Gammanpila warned that the current availability of fuel will last only till january next year. Note that Sri Lanka's state run agency, the Ceylon Petroleum Corporation,owes nearly 3.3 billion dollars to two Sri Lankan banks, i.e., the bank of Ceylon and the people's bank.

 

Nilgiri

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Their "rajapaksa" govt ran to CCP for all kind of white elephant projects........and now they come back to India for basic thing...
This is export of zombie-project culture to badly run govts @Viva_vietnamm ....the consequences...

@VCheng @Jackdaws @crixus et al.
 

VCheng

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Their "rajapaksa" govt ran to CCP for all kind of white elephant projects........and now they come back to India for basic thing...
This is export of zombie-project culture to badly run govts @Viva_vietnamm ....the consequences...

@VCheng @Jackdaws @crixus et al.

You mean the Iron Sugar Daddy is neither iron nor sugar nor daddy? Whowuddathunkdat?! :D
 

Nilgiri

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You mean the Iron Sugar Daddy is neither iron nor sugar nor daddy? Whowuddathunkdat?! :D

It needs autocrat goons of real intensity to do this in sri lanka from their end.

Rajapaksa (the younger) even banned (non organic) pesticides on a whim....and tried a mini mao approach (dbling down on it, rejecting all advisor input etc) and got a mao result in the agricultural production shortly.

Just didn't factor in basic reality and economics....for some autocrat brochure headline....unbelievable.

SL needs to see this goon family out ASAP. One is president, the other is PM....

There is whole swathe of corruption they have entrenched all over the place too.

This is btw more language-appropriate summary from a dear Lankan friend of mine lol.
 

Nilgiri

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Update:


The Export-Import (EXIM) Bank of India has handed over documentation related to a request by Sri Lanka for an urgent line of credit, valued at $500 million, to the respective Indian parties for negotiations with the Sri Lankan Government, The Sunday Morning has learnt.

“The EXIM Bank of India has given the documents to the Indian parties. However, we have not received them yet. We are waiting for them,” a senior Treasury official told The Sunday Morning on condition of anonymity. This came amidst reports from highly placed sources that the Treasury was moving slowly on securing the credit facility, despite it being an urgent need at present.

In September, the government had requested a $500 million credit line (LOC) from India to sustain fuel supply to the island, amidst concerns that there would be a fuel shortage by the end of the year.

(More at link)
 

Nilgiri

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India has sent 100 tonnes of Nano Nitrogen fertiliser to Sri Lanka in the backdrop of latter barring the use of contaminated Chinese fertilisers.

Sri Lanka had barred shipment of Chinese organic fertiliser after it was found to be contaminated with bacteria, a development that has miffed Beijing which was quick to blacklist People’s Bank of Sri Lanka in a quid pro quo move. The People's Bank is the second largest commercial bank in Sri Lanka.


Indian supplies reached on two Indian Air force Globemaster aircraft on Thursday, which was Diwali day. The supplies were requested by Sri Lankan government.

A release by the Indian high commission in Colombo said, "the deployment was essentially to support the government of Sri Lanka's initiative towards organic farming and to expedite availability of Nano Nitrogen fertiliser to the Sri Lankan farmers".

The C17 aircraft operations were coordinated in close liaison with Sri Lanka Air Force.

The Indian mission pointed out that the close coordination between the two services led to the "quick deployment....and expeditious disembarkation" of IAF aircraft.

The Indian crew was received by Chief of Staff, Sri Lanka Air Force AVM Prasanna Payoe.

This is not for the first time that New Delhi has reached out to Colombo as part of its "Neighbourhood First' policy" and 'First Responder' in the region.

Indian Navy and Coast Guard have promptly responded to several crises in Sri Lanka such as containing the fire onboard MT New Diamond and MV XPress Pearl.

India also sent 100 T Liquid Medical Oxygen during the fourth wave of Covid pandemic via INS Shakti.

Supplies of vaccines and medicines from India to Sri Lanka have been key element of ties amid the Covid crisis.

New Delhi has provided 1 million doses of Covishield vaccine to Sri Lanka with 50% of it being gifted by India.

======================================================

A downstream part of that organic-only overnight thing by the Rajapaksa bros @VCheng
 

Nilgiri

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India - SL relation news have been merged into one thread now.

=======================================================

More assistance is being requested by our southern neighbour:

 

Nilgiri

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It is good there is no bailout involved (we cannot afford to finance CCP-SL govt shenanigans).

There will be investment basis and credit line, thats good.

SL govt is learning hard way, but its learning @Viva_vietnamm

 

Nilgiri

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Sri Lanka has sought an additional credit line of $1.5 billion from India to import essentials, the island nation's central bank governor said on Monday, amid its worst economic crisis in decades.

The country of 22 million people is struggling to pay for essential imports after a 70% drop in foreign exchange reserves in two years led to a currency devaluation and efforts to seek help from global lenders.

Fuel is in short supply, food prices are rocketing and protests have broken out as Sri Lanka's government prepares for talks with the International Monetary Fund amid concerns over the country's ability to pay back foreign debt.

The new line is on top of the $1 billion support extended by India to help pay for critical imports when Sri Lankan Finance Minister Basil Rajapaksa travelled to New Delhi earlier this month.

"There is a very close discussion continuing for an additional support of $1.5 billion (with India) by way of oil support as well as other essential goods support of credit terms," Ajith Nivard Cabraal told an online event.

Cabraal's comments followed a Reuters report that said the crisis-hit country was in talks with India for an additional credit line of $1 billion.

New Delhi has indicated it would meet the request for the new line, to be used for importing essential items such as rice, wheat flour, pulses, sugar and medicines, one source briefed on the matter told Reuters.

India's foreign ministry did not respond to a request seeking comment.

REGIONAL RIVALRY

India's support for the roiled Sri Lankan economy comes after previous administrations led by the powerful Rajapaksa family drew the island nation closer to China during the past decade, leading to unease in New Delhi.

In Sri Lanka's main city of Colombo for talks, Indian Foreign Minister Subrahmanyam Jaishankar met the finance minister and his brother, President Gotabaya Rajapaksa, on Monday.

"Reviewed various dimensions of our close neighbourly relationship," Jaishankar said in a tweet after meeting the president. "Assured him of India's continued cooperation and understanding."

In addition to the credit lines, India this year extended a $400-million currency swap and a $500-million credit line for fuel purchases to Sri Lanka.

"India will be an ally for Sri Lanka's future progress," Cabraal said.

Sri Lanka's imports stalled, causing shortages of many essential items, after foreign currency reserves fell to $2.31 billion by February.

The nation just off India's southern tip has to repay debt of about $4 billion in the rest of this year, including a $1-billion international sovereign bond that matures in July.

Faced with a swiftly deepening crisis, President Rajapaksa has also sought help from Beijing, including a request to restructure debt payments.

His government is negotiating $2.5 billion in credit support from China, with a decision expected in the next few weeks.

Finance Minister Rajapaksa is set to fly to Washington, D.C. next month to start talks with the IMF for a rescue plan and also seek support from the World Bank.

"India is also very supportive of Sri Lanka's decision to seek an IMF programme and has given their fullest support," another source said.

Sri Lanka's government bonds fell on Monday after the IMF warned the country needed a "comprehensive strategy" to make its debt sustainable.
 

Nilgiri

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India on Monday assured southern neighbour Sri Lanka of continued assistance with the country facing its worst ever economic crisis that can snowball into a domestic political crisis for the ruling party. The assurance was extended by external affairs minister S Jaishankar, who called on Sri Lankan president Gotabaya Rajapaksa on Monday in Colombo as part of his three-day visit to the island nation.

Jaishankar, who arrived in Colombo on Sunday, met president Rajapaksa and reviewed various dimensions of India-Sri Lanka's close neighborly relationship. He assured Gotabaya Rajapaksa of India's continued cooperation and understanding.

"Pleased to call on President @GotabayaR of Sri Lanka. Reviewed various dimensions of our close neighborly relationship. Assured him of India's continued cooperation and understanding," Jaishankar tweeted.

During the meeting, the Lankan President thanked Jaishankar for assistance in the form of a $1-billion credit line.

(More at link)
 

Ryder

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Sri Lanka has fallen into a debt trap.

This is the problem we have lots of countries have fallen prey due to their corruption.

India has given Sri Lanka a lifeline in helping in paying its debts.
 

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India on Monday assured southern neighbour Sri Lanka of continued assistance with the country facing its worst ever economic crisis that can snowball into a domestic political crisis for the ruling party. The assurance was extended by external affairs minister S Jaishankar, who called on Sri Lankan president Gotabaya Rajapaksa on Monday in Colombo as part of his three-day visit to the island nation.

Jaishankar, who arrived in Colombo on Sunday, met president Rajapaksa and reviewed various dimensions of India-Sri Lanka's close neighborly relationship. He assured Gotabaya Rajapaksa of India's continued cooperation and understanding.

"Pleased to call on President @GotabayaR of Sri Lanka. Reviewed various dimensions of our close neighborly relationship. Assured him of India's continued cooperation and understanding," Jaishankar tweeted.

During the meeting, the Lankan President thanked Jaishankar for assistance in the form of a $1-billion credit line.

(More at link)

I hope this assistance comes with very strict rules set for Sri Lanka's future economic policy & strategic imperatives (I think we're doing at least the latter). Otherwise SL has proven time & again that it never learns.

At some level, I can't help but think at least one of the BRI countries needs to be allowed to fail - as an example to all the others.
 

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Sri Lanka was hailed as a role model at one point in the past. What happened?
 

ABee

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Sri Lanka was hailed as a role model at one point in the past. What happened?
Poor policy decisions and timing like banning Chemical fertilizers overnight hitting agriculture sector badly, along with covid, opening unviable projects and be in huge debt, Terror attack that drove away tourists and the pandemic that made it worse.
 

Nilgiri

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Sri Lanka was hailed as a role model at one point in the past. What happened?

A bad corrupt administration....taking on useless white elephant projects and terrible fiscal policies over prolonged period of time (when the economy seemed healthier....but still had underlying problems that were neglected).

Means rainy day situation hits them real hard now....have to (capital account) service the debt that comes due and your (current) earnings are slim. So belt tightening and negotiating in position of weakness.

Small countries (no matter how much role model they were before) are vulnerable to this extra hard (very little buffer saved).

I mean just look at Argentine history....relative to its wealth + dev.
 

Nilgiri

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India supplies rice, diesel to crisis-hit Sri Lanka as protests intensify: Top developments​



If I didn't know that this is all being done with the broader aim of countering Chinese influence, I'd be pretty upset indeed that we're giving away supplies at a time when there's global volatility and commodity prices are facing an uncertain future.

...and all so that we can get lectured again by so-called intellectuals as to how India needs to learn from the economic miracle that is the country with a population roughly that of the city of Mumbai.
 

Nilgiri

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If I didn't know that this is all being done with the broader aim of countering Chinese influence, I'd be pretty upset indeed that we're giving away supplies at a time when there's global volatility and commodity prices are facing an uncertain future.

...and all so that we can get lectured again by so-called intellectuals as to how India needs to learn from the economic miracle that is the country with a population roughly that of the city of Mumbai.

India has to play the long game to best of its ability with what it can spare for it...... no other choice given SL proximity to us.

i.e How to establish relationship with SL in multi-partisan way past the political + societal temperatures, memories, reactionary cycles and chauvinism that offer the ready short term partisan play.

Goes for indian ocean neighbourhood more broadly too....though distances there make things easier and harder at same time compared to SL.

BBIN is the other area of vital importance India must front/commit a lot and not concern itself too much with whatever "en vogue" slice of talking points from whichever "time to spare" partisan lot (of either extreme of india support or anti-india support).

Larger populations (with little time to spare) understand non-frivolous things in larger ways in the end....16+ hours out of their 24 hours daily are commited to survival and basic stuff....it impacts very much what they pressure later. Things are not so insulated as they might seem in the end between tiers of populace.
 
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