China tops Sri Lanka loan commitments

July 07, 2011 (LBO) - China has committed 760 million US dollars of new loans in the first four month of 2011, topping Japan's 413 million dollars in the same period, to reach top spot, official data showed. Sri Lanka's total capital budget is financed from loans, as the country runs a deficit on the current account of the budget but finance ministry has pushed up capital expenditure to 6.5 percent of gross domestic product or about a quarter of total state spending.

In the first four months Sri Lanka had drawn down 408.5 million dollars of foreign assistance with 382.

5 million dollars in loans and 26 million dollars in grants. Japan topped the list with 114.7 million US dollars including 6.8 million dollars in grants.

The World Bank gave 76.1 million dollars including 3.9 million in grants, India gave 55.

8 million dollars and China 35.6 million US dollars. In the first four months of the year Sri Lanka notched up 1,382 million dollars of loans, a finance ministry report said.

Lending agencies had given 208.8 million dollars with the World Bank committing 105.8 million US dollars, the Asian Development Bank 89.

2 million and UN agencies 8.8 million dollars.

The government was now sitting