India Supports Sri Lanka's Debt Restructuring & Economic Recovery

Colombo, Nov 2 (PTI) India on Thursday assured Sri Lanka that it will continue to work very closely with the island nation on debt restructuring discussions and extend support for the economic recovery.

Speaking at the 'NAAM 200' organised by the Government of Sri Lanka to commemorate the 200th anniversary of arrival of India-Origin Tamils (IOTs), Finance Minister Nirmala Sitharaman said India rendered an unprecedented financial assistance of over USD 4 billion last year when the island nation faced the financial crisis.

"When Sri Lanka faced its unprecedented economic crisis a year back, we felt it was our duty to stand by with our friends in Sri Lanka. We could not bear the difficulties our friends in Sri Lanka had to face. Our government and the people of India acted collectively and came to your assistance in record time," she said.

Sitharaman also said that India was the first bilateral creditor to convey financing assurance to the International Monetary Fund that paved the way for others to provide similar assurances that formalised the IMF programme for Sri Lanka.

"As a true friend, India continues to work closely with the Government of Sri Lanka on debt restructuring discussions as well as on its path of economic recovery," she said.

Sitharaman said that "our leaders have released a vision document for economic partnership in July this year, outlining specific areas of cooperation for a sustainable economic development and prosperity for our people."

India will work closely with the Sri Lankan government in realising the vision provided by the leadership of both the countries and thereby further deepening civilisational ties with connectivity as a new focus area, she said.

"While some of the connectivity projects have already made progress, notably the recent commencement of passenger ferry services... and UPI-based digital payments, which will be launched very soon. We are working closely with the government on other identified areas as well," she said.

As the two nation enhance connectivity, she said, "we build enduring bridges of experience and opportunities for our people".

"We believe a future with shared prosperity, overcoming the challenges of the past. I'm sure the India-origin Tamils will continue to play an important role in weaving a shared future for our two countries," she said.

Sitharaman is on three-day visit to Sri Lanka, which is struggling to come out of the financial crisis that hit the island nation last year, the worst since its independence from Britain in 1948.

As the country struggled, India extended multi-pronged assistance of about USD 4 billion to it last year through multiple credit lines and currency support, in line with India's 'Neighbourhood First' policy.

Talking about support being provided to the country, Sitharaman said Prime Minister Narendra Modi most fondly recollects his visit in 2017 to the beautiful region in the upcountry.

"Commending Phase III of the Indian Housing Project - India's flagship development project, Prime Minister Modi announced additional 10,000 houses for the plantation workers over and above the 4,000 houses under Phase III. I am happy to share that the phase III is nearing completion with 3,700 houses already handed over to the beneficiaries," she said.

She said the foundation stone for the construction of the first lot of 10,000 houses under Phase IV of the project has been laid on Thursday as part of NAAM 200.

"This will remain a special moment for our bilateral relationship as well as personally to me," she said.

In July this year, during the visit of President Ranil Wickremesinghe to India, Modi had announced a special grant package of SLR 3 billion (INR 75 crore) for multi-faceted projects for the IOT community.

Under