Bangladesh hopes Sri Lanka will repay $ 200 million debt on time

Bangladesh is hopeful that Sri Lanka will pay back $200 million debt that it owes to the country by March 2023, according to a report.

Abdur Rouf Talukder, governor of Bangladesh Bank, provided a positive outlook on the matter after a meeting with his Sri Lankan counterpart Nandalal Weerasinghe in the United States.

The two governors held a discussion on the sidelines of the Annual Meetings of the International Monetary Fund and World Bank at the World Bank headquarters in Washington, DC on Tuesday.

Bangladesh Bank Chief told reporters on Thursday that Bangladesh gave $200 million to Sri Lanka under a currency swap agreement, but due to the economic crisis, Sri Lanka could not return the money on time.

Bangladesh Bank Governor has said that Bangladesh extended the loan payment period twice at the request of Sri Lanka.

Talukder said that Sri Lanka is supposed to repay the US$ 200 million loan in three installments in February and March of next year.

On the talks with Weerasinghe, Talukder said, “We had a very good meeting. The governor assured me that they will meet the deadline for repayment. They are now restructuring their debts and have spoken to India, Japan, and China about it.”

He told the reporters that Sri Lanka is also working on a deal with the IMF that has also been roughly confirmed. “A final agreement on the program will probably be reached between November and December.”

Last year, Bangladesh agreed to give Sri Lanka loans of at least $200 million from its foreign exchange reserves under a currency swap deal.

The Bangladesh Bank released $50 million as the first tranche under a currency swap deal to support poorly-rated Sri Lanka on August 19, 2021.

The second tranche amounting to $100 million was released on August 30, 2021, and the final installment worth $50 million was released on September 21, 2021.

Agencies