Sri Lanka to replace 'unrealistic' budget, in talks to extend World Bank aid

to extend its support by US$300 million to US$700 million, the country's finance minister said on Wednesday .

The island nation, hit hard by Covid-19 and short of revenue after steep tax cuts by President Gotabaya Rajapaksa's government, is critically short of foreign exchange and has sought anRampant inflation and shortages of imported food, fuel and medicines have led to weeks of protests that have occasionally turned violent.

"The existing budget is unrealistic, given our challenges," finance minister Ali Sabry told a Parliament session.Mr Sabry said he wanted to increase tax revenue as a share of gross domestic product to 14 per cent within the next two years, from 8.7 per cent now. Sri Lanka will appoint within the next two weeks financial and legal advisers for a proposed restructure of its sovereign debt, he said, adding that the government was keen to work with the IMF on structural reforms.

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