Foreign debt burden rose by over Rs 626 Billion due to Rupee depreciation

Sri Lanka’s total foreign debt burden increased by over Rs 626 billion due to the depreciation of the Rupee in relation to the US Dollar between January, 2015 and November, 2017, Parliament was told today (26).

By Sandun Jayawardana

State Minister Eran Wickramaratne revealed this in answer to a question posed by United People’s Freedom Alliance (UPFA) MP Udaya Gammanpila. 

According to the Minister, the depreciation of the Rupee against the US Dollar during this period added Rs 626.439 billion to the foreign debt burden. 

Mr Wickramaratne noted that during the period from January 9, 2015 to November 30, 2017, the Rupee had depreciated by 14.6 percent against the US Dollar.

The Minister however, rejected MP Gammanpila’s contention that the Rupee had depreciated by so much as foreign investors had lost trust in Sri Lankan Treasury Bonds in the wake of the Central Bank bond scandal. He said that the debt burden in rupees increases anyway when one obtains foreign loans, if the Rupee depreciates against the US Dollar. He pointed out that the problem would not arise if loans were obtained in rupees instead of US Dollars.