India and Sri Lanka have discussed the early launch of the UPI payment system and emphasized their support in Sri Lanka’s debt restructuring process. India has provided substantial assistance to Sri Lanka, including over USD 4 billion, compared to the IMF’s bailout of approximately USD 3 billion.
Six months after the heads of both nations announced it, India has discussed the early implementation of the UPI payment system with Sri Lanka and restated its support for debt restructuring in the cash-strapped island nation.
Prime Minister Narendra Modi and Sri Lankan President Ranil Wickremesinghe signed a UPI acceptance agreement during his two-day visit to India in July 2023.
In his conversation with the CBSL Governor, the High Commissioner said India will help Lanka recover economically. After the meeting, the High Commissioner of India posted on X regarding SL’s early UPI payment system introduction, INR trade settlement growth, and India’s debt restructuring assistance.
Modi previously announced the two nations’ fintech agreement to integrate UPI with Lanka Pay. The start of ferry services between Nagapattinam, India, and Kankesanthurai, Sri Lanka, announced this.
India was Colombo’s trusted ally in 2023, aiding its economy. India gave roughly USD 4 billion compared to the IMF’s USD 3 billion bailout of Sri Lanka’s financial crisis.
On November 29, President Wickremesinghe indicated Sri Lanka is close to debt restructuring with external creditors. This is important for the IMF’s evaluation of Sri Lanka’s March 2023 USD 2.4 billion bailout facility, signaling financial stabilization.
Conclusion
Six months after signing an acceptance agreement, India and Sri Lanka explored an early UPI launch. In July 2023, Sri Lankan President Ranil Wickremesinghe visited India and signed the deal. India has helped Sri Lanka more than USD 4 billion, compared to the IMF’s USD 3 billion rescue during its financial crisis. Sri Lanka is close to a debt restructuring agreement with external creditors, which is vital for the IMF’s USD 2.4 billion bailout program appraisal.
