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SL to buy 75% of equipment for India-funded project from India 

21 Jun 2021

  • Credit conditions mandate 75% quota; loan for 15 years at 1.75% interest 

By Imsha Iqbal    The Sri Lankan Government has agreed to purchase 75% of the equipment from India for solar projects in Sri Lanka to which India recently extended a $ 100 million Line of Credit, The Morning Business learnt.  Speaking to us, the Director (Development) of the Ministry of Power, Sulakshana Jayawardena said that according to conditions in terms of the loan, Sri Lanka is supposed to purchase at least 75% of equipment and materials from India.  “Following the detailed study on this solar project, tenders will be called for manufacturers and suppliers from India,” Jayawardena added.  Responding to us, the Secretary to the Treasury, S.R. Attygalle stated that the mentioned LoC is a 15-year loan of a fixed rate of 1.75% and that within a period of decade and a half, Sri Lanka is ought to pay back to the India Exim Bank.  The implementation of the said project is estimated to be completed in three years, said Jayawardena.  He added that a major portion of the fund will be utilised for solar rooftop systems for Government buildings and 85% of the fund, which is $ 85 million, will be utilised for this.  He said that the Ministry of Power looks forward to investing on a pilot scale project of implementing floating solar in addition to providing solar panels to low income families as well as religious places apart from the identified buildings.  Speaking further he added that these solar projects would be generating electricity around 140 to 150 MW indicating that estimation has taken place on the overall power generation along with the location identification.  Jayawardena said that a consultant would be deployed by the Exim Bank and a detailed study will be conducted by this consultant.  “Now we have identified the buildings and the project capacity of solar power generation,” he further added explaining thus, the completion of the aforementioned study possibly would take a duration of three months.  The agreement for the LoC was signed by the Sri Lankan Government and the Export Import Bank of India which was exchanged between the Secretary to the Treasury of the Finance Ministry, S.R. Attygalle and the Indian High Commissioner Gopal Baglay in the presence of President Gotabaya Rajapaksa and State Minister of Solar Power, Wind and Hydro Power Generation Projects Development, Duminda Dissanayake at the Presidential Secretariat on June 16.


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