"A Friend In Need Is A Friend Indeed": Sri Lanka's Praise For India

India helped Sri Lanka more than any other country, especially when the island nation was struggling through an unprecedented crisis, Sri Lanka's Foreign Minister Ali Sabry said during Raisina Dialogue 'Ideas Pod.'

While the Indian government took some bold decisions to help the country tide over its economic crisis, even the Indian public came forward to support Sri Lanka, the country's foreign minister said in the podcast released on Tuesday.

Mr Sabry said, "Your real friends are tested when bad time comes. India has stood by us, a friend in need and a friend indeed that they say. So we are very grateful to India, for what it has done for us."

The Sri Lankan Foreign Minister also stated that the Indian government took some very bold, decisive actions by providing the island nation with about 3.9 billion worth of bilateral credit and accreditation. 

He further stated that it is the line which gave Sri Lanka the lifeline to fight the battle for another day, which probably saved the bankrupt country from oblivion.

Recalling India's effort in saving Sri Lanka from drowning in the debt, Mr Sabry said that India comes at the very beginning. He further stated that India's intervention was higher than the others countries.

India sent financing assurances to the International Monetary Fund (IMF), becoming the first of Sri Lanka's creditors to officially back the crisis-hit island nation's debt restructuring programme.

"This takes Sri Lanka one step closer to getting a crucial USD 2.9-billion package from the IMF, made contingent on "receiving financing assurances from Sri Lanka's official creditors and making a good faith effort to reach a collaborative agreement with private creditors," Mr Sabry said.

Sri Lankan foreign affairs minister was on an official visit to New Delhi to attend Raisina Dialogue - 2023, India's premier conference on geopolitics and geo-economics, jointly hosted by the Observer Research Foundation in partnership with the Ministry of External Affairs of India from March 2-4.

Notably, China, Japan, and India are Sri Lanka's three largest bilateral lenders.

External Affairs Minister S Jaishankar in January visited Sri Lanka and said that India is committed to increasing investment flows to Sri Lanka to hasten its economic recovery.

Talking regarding the IMF bailout package at Raisina Dialogue 'Ideas Pod', Sri Lanka's Foreign Minister said, " Yeah, I think it will help out in the sense when it comes to IMF bailing out of a country which has been declared bankrupt or otherwise, it had been declared as unsustainable of paying the debt. There are two components.

"One is you have to get debt assurances from the bilaterals which is not challenging. And as far as the IMF pre-actions that we need to take in terms of the staff level agreement we have taken all those things of 15 of them for example cost, reflective pricing, more revenue basis and then independent central bank. So many of those things we have done," Mr Sabry said.

"I think those things we could have done or should have done with or without IMF, which is good for the country, though it is not very popular. But the problem is how to sell these reforms to the people because it will directly affect them. All these files, what we have done is used printing machine to print the money and then inflation resulted in that giving hope to people," he added.

He further stated that IMF will bring a lot of confidence to the country. It will probably give the island nation access back to the financial market as well as it will also open up an investment which was ceased last year or so.

Sri Lanka sank into a financial crisis after the COVID-19 pandemic affected tourism and remittances from citizens working abroad fell. The war in Ukraine escalated the crisis as prices for imports, particularly fuel, rose sharply due to soaring inflation.

With worsening fuel and medicine shortages, thousands of protestors took to streets and stormed government buildings leading to President Gotabaye Rajapakse to flee the country and send in his resignation from abroad in July last year.

Ranil Wickremesinghe was elected President of the island country on July after defeating his main rival, Dullus Alahapperuma, with 134 votes to 82 in a parliamentary vote.

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