Sri Lanka completes Bangladesh loan repayment

by malinga
September 24, 2023 1:12 am 0 comment 1.4K views

Sri Lanka has paid off the US$ 200 million loan obtained from Bangladesh, taken through a currency exchange agreement two years ago to survive a severe dollar shortage, Bangladeshi media reported yesterday.

In the last installment, Sri Lanka paid about US$ 50 million and US$ 4.5 million in interest on the loan on Thursday night, a senior official of the Bangladesh Bank (BB) said. Sri Lanka took this loan for one year in May 2021, following a request by the then Prime Minister Mahinda Rajapaksa during an official visit to Dhaka.

However, the country failed to repay the loan in time due to a worsening domestic economic crisis and the Government declared bankruptcy.

In the wake of these events, Sri Lanka took an extension several times to repay the debt.

This year, Sri Lanka’s economy started to turn around and the country was able to repay the debt.

According to the Bangladesh Bank, Sri Lanka initially repaid US$ 50 million on August 20 and US$ 100 million on August 31. Finally, Sri Lanka repaid US$ 50 million on Thursday night. Sri Lanka has thus paid off the loan taken from Bangladesh in three installments.

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