Early realisation of US$ 1.5 b credit facility | Sunday Observer
Basil Rajapaksa and Indian External Affairs Minister hold virtual meeting

Early realisation of US$ 1.5 b credit facility

16 January, 2022

Finance Minister Basil Rajapaksa and Indian External Affairs Minister Dr. S. Jayashankar held a detailed virtual meeting yesterday morning to review the extension of India’s credit facilities to Sri Lanka including the early realisation of a US $ 1 billion term loan facility to purchase essential commodities and the US $ 500 million Letter of Credit to buy fuel.

Dr. Jayashankar in a series of twitter messages shortly after the meeting said, “Just concluded a detailed virtual meeting with Sri Lankan Finance Minister,” adding that he, “Reaffirmed that India will be a steadfast and reliable partner of Sri Lanka.”

The two ministers have also ‘positively noted’ the extension of the US$ 400 million swap facility and the deferred ACU (Asian Clearing Union) settlement of USD 515.2 million. The facility has been offered under the SAARC currency swap arrangement to Sri Lanka to help overcome its post pandemic economic challenges.

Dr. Jayashankar has assured that, “India will take up with other international partners initiatives to support Sri Lanka at this important juncture,” while welcoming the “progress on the Trincomalee tank farm which will contribute to energy security.”

Sri Lanka inked a deal with India to develop the oil tank farm early this month. Under the agreement, Lanka IOC will use the 14 oil storage tanks it currently operates for 50 years, while CPC will use 24 tanks.

Trinco Petroleum Terminal (Pvt) Ltd, set up by the CPC for the project, will develop the remaining 61 tanks as a joint venture with CPC holding a 51 percent stake and Sri Lanka IOC 49 percent.

Among the other topics discussed were the projects and investment plans by India and early release of Indian fishermen in Sri Lankan custody, as a humanitarian gesture.