The Prime Minister of India Mr. Narendra Modi, at his first visit to Sri Lanka in March 2015 had declared a fresh Line of Credit (LOC) of US$ 318 million for the development of railway sector in Sri Lanka.
Government of India has already provided four Lines of Credit for the development of railway sector in Sri Lanka through its EXIM bank amounting to approximately US$ 966 million.
The credit has been used by Sri Lanka to Improve it Southern and Northern Railways.
That visit of Prime Minister Modi was the first standalone bilateral visit by an Indian prime minister since 1987.
Current Status of Agreement
India on June 6th signed an agreement with Sri Lanka to provide USD 318 million as line of credit to develop the island nation’s railway sector.
The agreement was signed by RHS Samaratunga, Secretary, Ministry of Finance and Mass media, and David Rasquinha, Managing Director of India’s Export0Import Bank in Colombo.
India has been Sri Lanka’s major development partner in the South Asian region for more than 40 years.
Presently Indian development assistance mainly focuses on improvement of infrastructure, livelihood development, education, healthcare, and capacity building
China’s Investment in Sri Lanka
China has been investing heavily in Sri Lanka, developing mainly ports that could potentially be used as a base for its navy, though Beijing says the investments are part of its Belt and Road Initiative that aims to link it with Europe and Africa via the Indian Ocean.
Due to this there is increase of china’s presence in Indian Ocean.
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