Sri Lanka's Debt Restructuring: Balancing Acts and Economic Recovery

Sri Lanka is nearing the completion of talks with international bondholders on restructuring $12.5 billion in debt, aiming to save $8 billion and delay repayments by four years. The country seeks to balance relations with key creditors India and China while improving its economy amid presidential elections.

Sri Lanka is on the brink of concluding discussions with international bondholders about restructuring $12.5 billion in debt, Foreign Minister Ali Sabry announced on Tuesday. This milestone is crucial as the island nation aims to emerge from its most severe financial crisis in decades.

Having secured tentative agreements with some bondholders for the restructuring process, Sri Lanka now needs endorsement from the remaining private creditors and the International Monetary Fund. The nation has previously secured deals with official creditors, including Japan, China, and India, to restructure $10 billion in debt.

Sabry emphasized the importance of balancing ties with India and China while ensuring neutral foreign policy. Additionally, Sri Lanka is expected to experience economic growth this year as it continues to implement reforms and revamp state-owned enterprises.

(With inputs from agencies.)