Sri Lanka seeks fresh currency swap facility and Bilateral Talks With Sri Lankan Prime Minister

Indian officials said, Sri Lankan Prime Minister Mahinda Rajapaksa sought an additional currency swap facility and deferment of debt payments from India during an online bilateral summit with Prime Minister Narendra Modi on Saturday.

Sri Lanka owes about $960 million to India and earlier this year India agreed to a $400 million currency swap facility for Sri Lanka until November 2022.

The Indian foreign ministry in a statement, an additional request for a bilateral currency swap arrangement worth around $1 billion by the Sri Lankan side remains under discussion. Modi told his Sri Lankan counterpart that under the country's Neighbourhood First policy, India will continue to give special priority to relations between the two countries.

Prime Minister Narendra Modi today held wide ranging talks with his Sri Lankan counterpart Mahinda Rajapaksa, covering the entire spectrum of bilateral ties and with a focus on further expanding cooperation in key areas. In his opening remarks at a virtual bilateral summit, PM Modi said he was confident that the massive electoral victory of the ruling party in Sri Lanka backed by the Rajapaksa government's policies will facilitate deeper cooperation between the two countries.

PM Modi said, an opportunity has come to begin a new chapter in India-Sri Lanka ties after your party's electoral victory. People from both the countries are looking at us with new hope and expectations. India gives priority to its relations with Sri Lanka as he mentioned his government's neighbourhood-first policy as well as SAGAR (Security and Growth for All in the Region) doctrine.

Mahinda Rajapaksa was sworn in as Sri Lanka's Prime Minister for a fresh term on August 9 after his party, the Sri Lanka People's Front, secured a two-third majority in the parliamentary election.

It was Prime Minister Modi's first such virtual bilateral engagement with a leader of a neighbouring country. For Prime Minister Rajapaksa, it was the first diplomatic engagement with a leader of a foreign country after he was sworn in as PM. It was learnt that the two leaders deliberated on a host of issues like ways to further deepen overall defence and trade ties as well as expansion of existing cooperation in several key areas.