India told the IMF it would support Sri Lanka’s restructuring plan, bringing the embattled island economy’s debt saga one step closer to resolution. The IMF requires support from Sri Lanka’s bilateral creditors before it unlocks an agreed-upon $2.9 billion bailout.
Colombo still needs to earn the support of its other creditors, including Japan, Chinaand the so-called Paris Club group of major lender nations. Sri Lanka’s President, Ranil Wickremesinghe, who doubles as the country’s finance minister, said that debt negotiations with Japan concluded last week.
Analysts expect China to be the deciding factor in Sri Lanka’s receipt of the IMF bailout. This week, after a meeting with a Chinese delegation Wickremesinghe reportedly said Sri Lanka would “have good news soon.”