COLOMBO: Sri Lanka will receive $400 million later this week from a $1.5 billion swap agreement with the Reserve Bank of India (RBI) in line with a deal signed last month, the central bank said on Wednesday.
The RBI had entered a $1.5 billion currency swap agreement with the central bank of Sri Lanka, Indian Prime Minister Narendra Modi said on March 13 during his meeting with Sri Lankan leader Maithripala Sirisena.
The central bank in a statement said the RBI would make $400 million available on Thursday. The rest was expected to be made available in due course.
"It will be a temporary boost for our reserves," a central bank official said on condition of anonymity, as he is not authorised to speak to the media.
Sri Lanka's foreign exchange reserves fell over 10 percent in January as the government bought a $500 million sovereign bond amid heavy defence of the rupee currency.
The rupee has fallen 1.4 percent in the first quarter despite the intervention, Thomson Reuters data showed.