The Bangladesh Bank today (12) granted Sri Lanka six more months to repay the $200 million loan after Sri Lanka requested an extension to the repayment period due to the economic crisis.
A senior official of the Bangladesh central bank, on condition of anonymity, told Bangladesh’s The Daily Star the board of directors of Bangladesh Bank has extended the repayment tenure.
Sri Lanka borrowed $200 million from Bangladesh in May 2021 and was scheduled to repay the loan by April last year, but failed to do so.
In April last year, Sri Lanka announced defaulting on its entire $51 billion of external debt.
As per the agreement between the two countries, Sri Lanka was due to repay the loan by March.
Sri Lanka is still facing an acute shortage of foreign exchange reserves, which has compelled it to request to extend the repayment period.
The Bangladesh central bank extended the deadline at a time when its foreign exchange reserves are depleting at a faster pace.
As per the new deadline, Sri Lanka will have to repay the loan by September this year.
Bangladesh has already sought credit support from several multilateral lender agencies, including the International Monetary Fund.
The reserves of Bangladesh stood at $32.52 billion on January 11 in contrast to $44.92 billion in the same period a year ago, according to data from the central bank.
