Media outlets reported on Monday that the World Bank intends to disburse $ 700 million to crisis-stricken Sri Lanka by repurposing its existing loans. This will provide the island nation facing an unprecedented economic crisis with much-needed breathing room until a bailout package with the IMF can be negotiated.

Sri Lanka is on the verge of bankruptcy and suffers from severe food, fuel, medical, and cooking gas shortages.

For months, locals have had to wait in enormous queues to purchase the restricted supplies.

Colombo Gazette reported that World Bank Country Manager Chiyo Kanda met with Sri Lankan Foreign Minister last week and assured him that the organization would collaborate with the Asian Development Bank (ADB), Asian Infrastructure Investment Bank (AIIB), and the United Nations office to repurpose their already committed projects.

Minister Peiris requested support from the World Bank until long-term assistance from the IMF, other international institutions, and donor nations materializes, according to a report citing a statement from the Foreign Ministry of Sri Lanka.

According to the article, Kanda has informed Peiris that the international lender will transfer $ 700 million to Sri Lanka in the coming months.

Colombo Gazette reported earlier this month that the International Monetary Fund (IMF) remains committed to aiding Sri Lanka by its objectives.

With Sri Lanka, technical conversations have begun. According to the article, they will continue to prepare for policy debates after a new administration has been constituted.

The IMF stated that during its virtual mission from May 9-23, conversations at the technical level had just begun and continued as scheduled to be entirely prepared for policy discussions once a new administration had been constituted.

In addition, the IMF stated that it is closely monitoring developments in Sri Lanka and is concerned about escalating social tensions and violence.

In April, the two parties met for the first time at the headquarters of the IMF in Washington.

Sri Lanka is seeking a Rapid Finance Instrument (RFI) facility and a larger Extended Fund Facility (EFF) from the international financial organization to address its foreign currency shortages, which have sparked an economic catastrophe.

At the most recent conference, the IMF pledged between $300 million and $600 million to assist the country.

Sri Lanka ceased debt servicing for the first time on April 12.

Since its independence from Britain in 1948, the island nation has been undergoing its most significant economic crisis.

The economic crisis has also sparked political upheaval, with a demonstration occupying the entrance to the president's office for more than 50 days and demanding his resignation.