India’s Assurances to IMF backing Sri Lanka

January 19, 2023

India sends financing assurances to IMF to back Sri Lanka’s debt restructuring program. Sri Lanka’s three largest bilateral lenders are China, Japan, and India. India’s backing is a critical step for Sri Lanka to receive a $2.9 billion package from IMF

Sri Lanka’s Debt Crisis

Sri Lanka is facing worst economic crisis since 1948
Challenges include shortage of dollars, runaway inflation, and steep recession
Sri Lanka owes India around $1 billion that will come under the debt restructuring plan
Sri Lanka’s chances of swift assistance now depend on similar assurances from Japan and

Need for Assurances

New Delhi’s backing is critical for Sri Lanka to unlock a $2.9 billion IMF loan
Sri Lanka needs to secure prior financing assurances, put debt on sustainable path, and increase public revenue
IMF stresses importance of joint talks involving China, Japan, and India