Political crisis, tumbling rupee add to Sri Lanka's economic woes

Paying back just got harder as political crisis sends Sri Lankan rupee to its lowest level against US dollar.

by

    China and India are both keeping a close eye on the political situation in Sri Lanka. The island nation plunged into a constitutional crisis with two men claiming to be the lawful prime minister.

    Sri Lanka owes more than $50bn to foreign lenders, which is 77 percent of its gross domestic product (GDP). Next year, it has to pay back more than $4bn of its foreign loans, which just got harder as the political crisis has sent the rupee to its lowest ever level against the US dollar.

    China sees Sri Lanka as crucial in its plans to expand trade routes, while India is nervous about growing Chinese influence in its neighbourhood.

    Al Jazeera's Bernard Smith reports from Colombo.


    YOU MIGHT ALSO LIKE

    Women under ISIL: The wives

    Women under ISIL: The wives

    Women married to ISIL fighters share accounts of being made to watch executions and strap explosives to other women.

    Diplomats for sale: How an ambassadorship was bought and lost

    Diplomats for sale: How an ambassadorship was bought and lost

    The story of Ali Reza Monfared, the Iranian who tried to buy diplomatic immunity after embezzling millions of dollars.

    Crisis of Aboriginal women in prison in Australia

    Crisis of Aboriginal women in prison in Australia

    Aboriginal women are the largest cohort of prisoners in Australia, despite making up only 2 percent of the population.