Sri Lanka notifies Indian rupee as designated currency

Sri Lanka has notified the Indian rupee as a designated currency, Indian External Affairs Ministry Spokesperson Arindam Bagchi said on Thursday (July 20).

“In terms of trading in our national currencies, Sri Lanka has already notified India Rupee as designated foreign currency in their system,” Bachi said during a weekly media interaction in New Delhi.

Making Indian rupee (INR) as a designated foreign currency enables not only trade settlement between the two countries in INR but also Indian tourists coming to Sri Lanka can use INR for transactions.

Deepening financial and economic connection Bagchi said that the utilisation will depend on India’s private sector and people who engage in the trade sector.

“We would like to deepen this financial and economic connection. It will be premature to comment today on it, when the visit is tomorrow,” he added.

The comments came hours before Sri Lankan President landed in the capital New Delhi to kickstart his two-day visit to India.

Wickremesinghe in India

Wickremesinghe was invited by Prime Minister Narendra Modi and is the first Sri Lankan leader to visit since the island nation was hit by an unprecedented economic crisis last year.

Notably, this is also the first time that the 74-year-old Sri Lankan leader is vising India since he assumed office in July 2022 after his predecessor, Gotabaya Rajapaksa, fled Sri Lanka amid massive public protests.

President Wickremesinghe is expected to visit his Indian counterpart Droupadi Murmu and discuss various issues of mutual interest with Prime Minister Narendra Modi and other Indian dignitaries, the Ministry of External Affairs said in a press release.

The Indian Ministry of External Affairs (MEA) in a press release noted, “Sri Lanka is an important partner in India’s Neighbourhood First Policy and Vision SAGAR. The visit will reinforce the longstanding friendship between the two countries and explore avenues for enhanced connectivity and mutually beneficial cooperation across sectors.”

India helping Sri Lanka

Meanwhile, Bagchi earlier in the day said that Wickremesinghe’s India visit is a major one as the country has important, multifaceted relations with the island nation.

“This is a very important visit, it is a neighbouring country with whom we have very important relationship, we have multifaceted relations,” he said.

Ever since Sri Lanka plunged into economic chaos, India has been helping the island country by providing aid, medicines and other essential items.

Last year, India gave aid worth almost $4 billion, including currency support, deferred payment of loans and lines of credit for emergency purchases of food, fuel and medicines, to Sri Lanka.

Sri Lanka will now focus on grid connectivity between the two countries, port development and renewable energy projects, largely in the northern part of the island, when President Ranil Wickremesinghe visits India from July 21 for two days, Foreign Minister Ali Sabry told reporters on July 10. – WIO