Indian foreign minister in crisis-hit Sri Lanka to discuss economy

Colombo, Mar 29 (EFE).- Indian External Affairs Minister S Jaishankar on Tuesday participated in a regional ministerial dialog in Colombo, a day after he met key leaders of Sri Lanka, its crisis-hit neighbor which has become is increasingly dependent on India amid geopolitical concerns over Chinese influence.

He was taking part in the summit of the Bay of Bengal Initiative for Multi-Sectoral Technical and Economic Cooperation – which includes Bangladesh, Bhutan, Myanmar, Nepal and Thailand apart from India and Sri Lanka – being hosted by Colombo in its capacity as the current chair of the bloc.

Jaishankar said in a tweet after the summit that he “he emphasized our commitment to intensify and expand areas of cooperation, especially connectivity, energy and maritime cooperation. (…) Will encourage active business collaboration and common projects to this end.”

The Indian top diplomat, who had arrived in Sri Lanka on Sunday, on Monday met Sri Lankan President Gotabaya Rajapaksa, Prime Minister Mahinda Rajapaksa, Finance Minister Basil Rajapaksa and ethnic minority Tamil leaders during the first day of his three-day official visit.

Last week, India approved a credit line worth $1 billion to Sri Lanka as part of economic aid to the island to help it overcome a severe fuel and economic crisis. New Delhi had already provided $500 million to Colombo in fuel credit earlier.

Rajapaksa said in a tweet that he expressed his gratitude to Jaishankar for India’s “invaluable assistance.”

New Delhi and Colombo signed bilateral MOUs for establishing the Sri Lanka Unique Digital Identity (SL-UDI) program with Indian government’s assistance, apart from cooperation in setting up a Maritime Rescue Coordination Center, hybrid power projects in three Islands off the former war zone of northern Jaffna, and for developing fishing harbors in Sri Lanka.

Jaishankar met minority Tamil political leaders and to post-war reconciliation and implementation of a constitutional clause that ensures devolution of power to provinces.

Government officials said Sri Lankan leaders have requested further extension of the existing credit line to tackle the ongoing economic crisis as the island faces the risk of a possible sovereign debt default this year.

“The $500 million fuel credit line is likely to be fully used by the end April and $1 billion credit to buy essential food and medicines is only enough until May,” a government official who is aware of the discussion told EFE on the condition of anonymity.

“The country needs more funds to manage fuel and essential foods. We are exploring if India could further help on this.”

India has in recent past strengthened its diplomatic ties with Sri Lanka, which had been moving closer to China – the largest investor and lender for the island over the past decade – since Rajapaksa was elected president in 2019.

The current government had unilaterally cancelled a tripartite agreement with India and China for a $500 million container terminal at the Colombo port, apart from handing over other important projects to Beijing, despite Indian overtures. The container terminal is next to the Chinese built Port City and a China-controlled port terminal.

However, since late last year, the deterioration of the Sri Lankan economy forced the country to seek help from India and signing several bilateral deals, including an oil tank farm and a solar power plant in the eastern port district of Trincomalee.

The island is also under pressure from the West and European Union over its past alleged human rights violations, which have contributed to the government seeking closer ties with India and the West to avoid possible sanctions, according to analysts.

Sri Lanka has for months been hit by severe fuel shortages for several months due to the deep economic crisis in the country.

Inflation has crossed record levels, forcing some families to sacrifice meals due to food shortages and rising prices.

The authorities have deployed the army at gas stations to restore order amid long queues of people waiting to have their tanks filled, while the government has announced regular extended power cuts to forcibly reduce energy demand. EFE


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