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Sri Lanka’s Opposition accuses government of misusing USD one billion loan facility extended by India

Colombo, Mar 22 (PTI) Sri Lanka’s Opposition party Samagi Jana Balawegaya (SJB or United People’s Force) on Tuesday accused President Gotabaya Rajapaksa government of misusing the USD one billion loan facility extended by India as part of its financial assistance to help the island nation deal with its economic crisis.

“I say with responsibility that SLPP is trying to set up home shops in 14,000 villages to do their political work by misusing this Indian assistance,” main opposition leader Sajith Premadasa said in Parliament.

“This is shameful, the money is meant to provide relief to people who are languishing in long queues,” Premadasa said, referring to long lines at fuel stations and scarcity of essentials faced by the people.

The Opposition parties have also protested over several proposed tie-ups with India which they claimed were hatched in secrecy. They have sought an explanation from Finance Minister Basil Rajapaksa.

Cabinet spokesman and Minister Ramesh Pathirana announced that the Cabinet on Monday approved several India-partnered initiatives.

He said the Government of India has agreed to provide a grant of USD 6 million for the establishment of a Maritime Rescue Coordinating Centre in Sri Lanka.

Accordingly, the Cabinet approved the proposal presented by President Rajapaksa in his capacity as the Defence Minister to sign a Memorandum of Understanding between the two countries and to sign an agreement with India’s Bharat Electronics on the establishment of the Centre.

The Cabinet also approved entering an MoU with the Government of India for the implementation of the Sri Lanka Unified Digital Identity Framework. Pathirana said India has agreed to provide a grant of Rs 300 Million to implement the network.

He added that another MoU with India for the development of fishery harbors in Sri Lanka has also been approved, under which selected fisheries harbors in the north and south will be developed.

During Finance Minister Basil Rajapaksa’s trip to New Delhi early this month, India announced a USD 1 billion line of credit to Sri Lanka as part of its financial assistance to help it deal with its economic crisis.

After an agreement to extend the line of credit was inked, Ministry of External Affairs (MEA) Spokesperson Arindam Bagchi said India has always stood with the people of Sri Lanka and will continue to extend all possible support to the country.

The finance minister said there are no special conditions for the line of credit.

“There are no special conditions the repayment will be in three years,” he said when asked about the USD 1 billion line of credit. He said the local importers are now free to import goods from India under the loan facility with the local trade ministry employing a transparent process to facilitate importers.

The Indian line of credit came a month after Sri Lanka purchased 40,000 metric tonnes of diesel and petrol from India’s oil major Indian Oil Corporation to meet the urgent energy requirements in the economic crisis worsened by depleted foreign reserves.

Currently, the island nation’s situation is such that long queues prevail for fuel, gas and other essentials as shipments dried due to forex shortages. Power cuts were imposed due to scarcity of fuel to run thermal power plants.

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