Sri Lankan Economic Crisis

Context:

• Sri Lanka is facing severe economic crisis mainly due to the depletion in the forex reserves, which has led to shortages in fuel, food, medicines and other essential items.

Background:

• The pandemic deepened the economic crisis in Sri Lanka which has always been facing the problems of dealing with debts both domestic and international.
• Over the last three months, India has provided assistance of $2.4 billion including a $500 million loan deferment and $1 billion credit line to enable the supply of essential commodities
• Apart from approaching Beijing, Colombo has also sought help from the International Monetary Fund, shedding its earlier reservation of taking help from the agency.

What are the challenges to India?

• Even earlier in the anti-Tamil riots of 1983 in Sri Lanka, India that too Tamil Nadu was home to nearly three lakh refugees.
• Even now Tamil Nadu has already started to feel the impact of the crisis with reportedly 16 persons from Sri Lanka have illegally entered India.
• Now authorities of both India and Sri Lanka should ensure that smuggling, trafficking and other illegal activities are prevented.

Way Forward:

• In the midst of every crisis is an opportunity, so this crisis should be used as an opportunity to strengthen the relations between New Delhi and Colombo.
• Both the countries should chalk out a solution to the long standing dispute of the Palk Bay fisheries.

 

Source: THE HINDU.

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