Bankrupt Sri Lankan government .. Food crisis from August! What is the fate of the people of Sri Lanka?

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Sri Lanka Crisis : The economic downturn in Sri Lanka is unprecedented and is gripping the people.

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First Published May 20, 2022, 12:24 PM IST

As a result, there has been a political crisis as the public has taken to the stage. The World Bank’s $ 160 million loan is a great help to the Sri Lankan government, which is at a loss as to how to recover from this massive economic downturn. However, Sri Lanka has been plunged into bankruptcy for the first time.

The Central Bank of Sri Lanka has declared the government bankrupt

The Central Bank of Sri Lanka has announced that the Sri Lankan government has gone bankrupt as the struggle intensifies in Sri Lanka. This has caused a great stir. Central Bank Governor Nandalal Weerasinghe has said that inflation will rise from 30 per cent to 40 per cent. Policymakers have told Sri Lankan lenders that the Sri Lankan government will not be able to repay any of the debt until the country’s total debt is restructured.

Sri Lanka is in dire straits as the currency and economic crisis worsen, leaving Sri Lanka without even the foreign exchange reserves needed to import food and fuel. The outstanding amount of essential commodities purchased by Sri Lanka from abroad has increased since January. The Sri Lankan government has also withheld about $ 12.6 billion in payments. Sri Lanka went bankrupt for the first time since independence from Britain in 1948, unable to repay the loan.

The Central Bank of Sri Lanka has declared the government bankrupt

Therefore, there is a possibility of a food crisis in Sri Lanka from August. In this situation, the International Monetary Fund has informed President Gotabhaya that it is ready to help Sri Lanka. It has been reported that Sri Lanka is ready to provide the necessary financial assistance to resolve the economic crisis and recover the country. However, the problem persists as it is subject to a number of conditions. It is noteworthy that this was debated in the parliament of that country.

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Last Updated May 20, 2022, 12:24 PM IST

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