Sri Lankan President Ranil Wickremesinghe has said that India’s response to the debt restructuring proposal is expected by the end of this month. The neighboring country facing cash crunch requested India for debt restructuring. Sri Lanka is currently trying to get a bridge loan (interim loan) of US $ 2.9 billion from the International Monetary Fund (IMF). Bridge loans are taken to meet immediate needs and are generally of a shorter tenure.

Sri Lanka needs financial assurances from its major creditor countries – China, Japan and India – to get a relief package from the Monetary Fund. For this, Sri Lanka started debt restructuring talks with these countries from September last year. Wickremesinghe told reporters that he expected a $2.9 billion loan from the IMF in the first quarter of this year. Earlier, he had said that India and Sri Lanka held successful talks on debt restructuring and the country would start discussions with China as well.

The IMF has currently put the bailout package on hold as Sri Lanka is currently negotiating with its creditors. The IMF had made it a condition for the relief package that Sri Lanka negotiates with its creditors to restructure the debt. Wickremesinghe said Sri Lanka has asked China to extend the loan repayment period and has not asked to reduce the debt.

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