Sri Lanka's Foreign Debt Soars to $37 Billion, Parliament Committee Calls for Oversight

Sri Lanka's foreign borrowing has ballooned to US$ 37 billion, a figure that has prompted concern and a call for enhanced financial oversight from the Parliament’s Committee on Public Finance (CoPF).

The daunting debt total, which amounts to approximately Rs. 19.6 trillion, was officially disclosed during a recent session of the CoPF, chaired by Member of Parliament Dr. Harsha de Silva. Officials from the State Debt Management Office (SDMO) confirmed the current debt stock, noting that all international borrowing activities are now consolidated and administered solely by their office-a centralization intended to provide greater control and management.

However, the scale of the financial obligation led Dr. de Silva to express significant concern, particularly regarding the need to urgently strengthen the institutional capacity and technical expertise within the SDMO. He emphasized that resolving the country's persistent financial vulnerabilities demands not only sound policy reform but also the recruitment and retention of skilled professionals capable of navigating the highly complex global financial markets.

The CoPF discussions highlighted that the current foreign debt obligations are owed to a diverse group of creditors, including bilateral partners, multilateral lenders, and international bondholders. Furthermore, committee members underscored that any future borrowing must be approached with stringent strategic clarity, ensuring a responsible balance between immediate national fiscal needs and long term debt sustainability. In response to the revelations, some lawmakers pressed for the introduction of new legislation to increase parliamentary oversight of all foreign borrowing, arguing that a more rigorous and transparent framework is essential to prevent the accumulation of unsustainable debt in the future. The disclosure comes as Sri Lanka continues to report "impressive progress" in its economic reform program under the International Monetary Fund's Extended Fund Facility.

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