Pakistan got shocked by this act of China and got IMF help for Sri Lanka like this
The way has been cleared for this debt-ridden country to get a relief package of $ 2.9 billion from the International Monetary Fund (IMF).
Pakistan, which is suffering from poverty and inflation, has high hopes for its friend China. China has a huge debt to Pakistan, which it is demanding concession. But by showing defiance to Pakistan, China has given great relief to India’s other neighbouring country Sri Lanka. China has assured support for Sri Lanka’s debt restructuring. Due to this relief, the way has been cleared for this debt-ridden country to get a relief package of $ 2.9 billion from the International Monetary Fund (IMF).
Sri Lanka’s economic crisis averted?
Sri Lankan President Ranil Wickremesinghe informed us about this relief received from China on Tuesday. In January, India also strongly supported efforts to get loans from the IMF for Sri Lanka, which is going through an economic crisis. Wickremesinghe also holds charge of the Finance Ministry. “A fresh letter has been received from the Exim Bank of China following which our letter of intent has been sent to the IMF,” he informed Parliament. The obligation from our side has been fulfilled and it is expected that by the third or fourth week of this month, the IMF will fulfil its duty. This will also make it possible for us to get funds from the World Bank and the Asian Development Bank (ADB).
Sri Lanka has received a relief package of $ 2.9 billion.
In an earlier letter, China had asked for a two-year moratorium for loan repayment, which the IMF considered insufficient. The IMF in September last year approved a $2.9 billion bailout package for Sri Lanka over a period of four years, subject to Sri Lanka’s ability to restructure its debt with creditors. By the end of June 2022, Sri Lanka had a bilateral, multilateral and commercial debt of about $ 40 billion. Out of the total debt, the share of debt from China is 20 per cent and bilateral debt is 43 per cent.
Pakistan also needs help
Pakistan, another neighbour of India facing a cash crunch, is awaiting an instalment of $1.1 billion from the IMF. A media report said on Tuesday that Pakistan has informed the IMF that it has requested China to extend the term of ‘State Administration of Foreign Exchange (SAFE)’ deposits of two billion dollars for one more year. The deposit is due to mature at the end of the current month. China has total SAFE deposits of $4 billion. The maturity period for the remaining amount is in the next few months.
