China commends India’s assist to crisis-hit Sri Lanka, says South Asia stays its precedence

In a uncommon gesture, China on Wednesday recommended India’s efforts to help Sri Lanka to take care of its worst monetary disaster however refuted the island nation’s President Gotabaya Rajapaksa’s remarks that Beijing has shifted its strategic focus from South Asia, together with Pakistan, to South East Asia, saying the area nonetheless remained its precedence.

Sri Lanka has been grappling with unprecedented financial turmoil since its independence from Britain in 1948. Sri Lanka’s financial disaster has created political unrest with protesters demanding President Rajapaksa’s resignation.

“We have taken note that the Indian government has also done a lot in this regard. We commend those efforts,” Chinese Foreign Ministry spokesman Zhao Lijian informed a media briefing right here whereas replying to questions on whether or not China, which has made massive investments in Sri Lanka, is hesitating to assist it when the island nation is dealing with the worst financial disaster.

“China is ready to work with India and the rest of the international community to help Sri Lanka and other developing countries experiencing difficulty to pull through the hardship as early as possible,” he mentioned in an up to date remark posted on the Foreign Ministry web site.

India has rushed about USD 3 billion in help within the type of line credit score and different modes to assist Sri Lanka which has nearly declared insolvency and defaulted on all international loans together with that of China totalling to USD 51 billion.

China has introduced help of 500 million RMB (about USD 74 million) for the availability of important items however remained silent about President Rajapaksa’s request to defer the mortgage compensation, in addition to its earlier announcement to think about a USD 2.5 billion mortgage facility for Colombo.

Beijing seemed to be peeved over the remarks by Rajapaksa that China seems to be shifting its strategic focus in the direction of South-East Asia and Africa, noting that South Asian international locations in monetary hassle should not getting the identical consideration from Beijing as earlier than.

In an interview to Bloomberg on Monday, Rajapaksa mentioned that Lanka could not faucet a USD 1.5 billion (credit score line from Beijing) and has but to listen to again on his request to President Xi Jinping for a USD one billion mortgage to purchase important items.

Rajapaksa mentioned China indicated that it could assist Sri Lanka, whereas including that “usually they don’t like” lending out extra money to cowl earlier debt funds.

“My analysis is that China has shifted their strategic focus into South-east Asia,” Rajapaksa mentioned. “They see more strategic interest in the Philippines, Vietnam and Cambodia, that region, and Africa.”

“They have less interest in this region,” Rajapaksa mentioned. “I don’t know whether I am right or wrong, even the focus on Pakistan has gone down. That shows that their interest here is not like earlier. Their interest has shifted to two other areas,” the Sri Lankan president mentioned.

Sri Lanka and Pakistan are the most important recipients of China’s greatest investments and loans within the area. While Colombo obtained about USD eight to 10 billion investments and loans from China, Beijing is at present dedicated to construct USD 60 billion China Pakistan Economic Corridor (CPEC) over which India has protested as it’s being laid by means of the Pakistan-occupied Kashmir (PoK).

Significantly, each international locations are searching for IMF bailout packages to tide over the worst financial disaster.

China has already rolled over USD 4.5 billion debt of Pakistan in March and reportedly agreed to not withdraw USD 2.5 billion from Pakistan’s central financial institution, which Beijing deposited in 2019 to spice up the depleted foreign exchange reserves of the all-weather ally to stop it from going the Sri Lanka manner.

Observers say Beijing is nervous that with extra international locations within the area more likely to face severe financial crises, calls for for monetary help might improve, placing strain on the Chinese economic system, which is in a slowdown mode with growing strain exerted by Covid lockdowns.

Reacting to Rajapaksa’s remarks, Zhao mentioned, “as a traditional friendly neighbour, China pays close attention to and feels for the difficulties and challenges facing Sri Lanka. We have all along provided support to Sri Lanka’s socio-economic development as long as our ability permits”.

“As to China-Sri Lanka financial cooperation, shortly after the Sri Lankan government announced to suspend international debt payments, Chinese financial institutions reached out to the Sri Lankan side and expressed their readiness to find a proper way to handle the matured debts related to China and help Sri Lanka to overcome the current difficulties,” he mentioned.

“South Asian countries, along with the other countries in our neighbouring areas, are China’s priority in its diplomacy. China attaches great importance to forging closer good neighbourly relations with its neighbours and has worked hard to this end,” he mentioned, citing Beijing’s help in pure disasters, international monetary disaster and Covid.

“China will work with relevant countries to respond to risks and challenges and pursue high-quality Belt and Road cooperation to jointly sustain the sound momentum of security, stability, cooperation and development in our region and bring great benefits for all peoples in this region,” he mentioned.

On the financial disaster, he mentioned, “we have noted and followed closely the financial, fiscal and international balance of payment difficulties facing the South Asian countries and other developing countries as you mentioned”.

“These difficulties partly stem from the challenges brought by the Covid-19 pandemic. They also have a lot to do with the Russia-Ukraine conflict and the unilateral sanctions slapped by the US and other Western countries on Russia in the wake of the conflict”, which had aggravated the meals disaster and monetary difficulties in creating international locations and inflicted much more hardships on folks, he mentioned.