* There is no way to repay the loan
* Excitement by the announcement of the Governor of the Central Bank
Colombo: The Governor of the Central Bank of Sri Lanka Nandalal Weerasinghe has stated that there is no possibility of repaying any loan due to the economic downturn and the collapse of foreign exchange reserves. Thus, the bankruptcy of Sri Lanka has created further problems for the country. Sri Lanka is in deep economic crisis after the Corona disaster. The foreign exchange available to the country through tourism has come to a standstill.
Moreover, due to the misguided economic policy of the Rajapaksa government, the country’s economy has sunk to the brink. Lack of foreign exchange to buy gas and fuel has led to several hours of power outages in Sri Lanka and most hotels have been closed. The public, outraged by the sharp rise in prices and even the shortage of daily necessities, boiled over against the Rajapaksa government. As a result, Mahinda Rajapaksa resigned as Prime Minister. He was followed by President Gotabhaya Rajapaksa and Ranil Wickremesinghe
He has been appointed as the new Prime Minister. Ranil has been struggling in various ways to revive the economy. Neighboring India is also extending a helping hand to Sri Lanka. The Sri Lankan government is also in talks to seek additional credit from the International Monetary Fund. But Sri Lanka’s problem is not solved. Addressing the people of the country recently, Prime Minister Ranil Wickremesinghe warned that ‘the next 2 months will be very difficult for Sri Lanka’. The government said, “People should not stand in line for fuel because the government does not even have the money to pay for the ship that brought the fuel.”
Thus, on the one hand, the Sri Lankan government is running out of money for daily expenses, and on the other hand, it is unable to repay the loans taken from foreign countries and international financial institutions. Sri Lanka has borrowed a total of ₹ 3.82 lakh crore from foreign countries, banks and the International Monetary Fund. In addition, the amount to be paid for the purchase of essential commodities including rice, petrol and diesel alone is ₹ 94 billion. In this case, the 1 month grace period for Sri Lanka to repay the total loan amount ended on the 18th.
Even after this the Sri Lankan government was unable to pay the installments. With this, for the first time in history, the Governor of the Central Bank of Sri Lanka has announced that the loan will not be repaid. Central Bank Governor Nandalal Weerasinghe told monetary policymakers, “Sri Lanka’s economic growth rate this year will be very sluggish. Inflation, currently at 30 per cent, is expected to rise to 40 per cent in the next few months.
Therefore, our position is very clear. Sri Lanka will not be able to repay any loan for the loan until the loan is restructured. We have already informed the borrowers about this. This can be said to be a precondition for defaulting on a loan. For additional credit, we are in talks with the International Monetary Fund. We are in talks with the lenders to restructure the debt. ”
This confirms the bankruptcy of Sri Lanka. The Sri Lankan government recently announced that another ₹ 30 trillion was needed to lift Sri Lanka out of the predicament.
Sri Lanka can only recover from the economic crisis if the international community provides this amount and restructures the debt. In this situation, as Sri Lanka goes bankrupt, the biggest question is whether even the lending countries will lend in the near future. Sri Lanka has borrowed a total of ₹ 3.82 lakh crore from foreign countries, banks and the International Monetary Fund.
Inauguration of 9 Ministers
Amid the economic crisis in Sri Lanka, only four ministers were in the cabinet headed by Prime Minister Ranil Wickremesinghe. In the government led by President Gotabhaya Rajapaksa, no opposition party wants to be in the cabinet. Meanwhile, following Ranil’s talks with various national parties, the major parties agreed to participate in the government.
Accordingly, 9 new ministers were sworn in yesterday. They were sworn in by President Gotabhaya. 9 Ministers belong to parties including Sri Lanka Freedom Party, Sri Lanka People’s Front, United People’s Power. In this, it is noteworthy that Susil Premajayantha, who is in charge as the Minister of Education, was removed from the Cabinet by President Gotabhaya because he criticized the government during the last Mahinda regime.
G7 countries loan assistance
The G7 nations have said they are ready to lend a helping hand to Sri Lanka, which is in dire straits. The G7 includes 7 countries: the United Kingdom, Canada, France, Germany, Italy, Japan and the United States. This has been welcomed by the Prime Minister of Sri Lanka Ranil. He tweeted, “I welcome the G7’s statement that it will lend a helping hand to Sri Lanka. Sri Lanka will recover from the economic crisis with the continued cooperation of the international community. ”