The government's debt office, which is a unit of the Central Bank, said it is offering 50 million US dollars each in 2 year and 3-year bonds which will pay a coupon based on the 6-month London interbank offered rate (LIBOR) plus a risk premium.
The bonds are tax-free and can be bought by foreign investors and local firms that can have foreign currency assets with approval from the state investment promotion agency.
Bids opened on March 12, the debt office said.
In 2010 Sri Lanka is also hoping to go for a longer tenor 500 million US dollar sovereign bond.
The bonds have been popular among Sri Lanka's banks and other investors.
Sri Lanka last sold 2-year bonds in August 2009 at 4.50 percent above LIBOR. The last 3-year sale was 4.25 percent above LIBOR in September 2009.
But analysts expect risk premiums to come down sharply this year.
In October 2009 both Fitch and Standard & Poor's raised Sri Lanka's rating outlook.
Sri Lanka is rated 'B+' with 'stable' outlook by Fitch and 'B' with a 'positive' outlook by Standard & Poor's.