Sri Lanka has used 121 million US dollars from the proceeds of an International Monetary Fund loan to repay an Indian credit line, State Minister for Finance Ranjith Siyambalapitiya said.
Sri Lanka got 331 million dollars from the IMF in the first tranche.
Unlike in the past where the IMF funds went to the central bank, this time the money came to a Treasury account, Siyambalapitiya said.
Sri Lanka has been given permission to use IMF funds for budgetary purposes.
India gave some credit lines to Sri Lanka after the country defaulted on its debt in April 2022 and the money is outside the debt re-structuring parameter.
Sri Lanka is negotiating with India to repay the funds separately.