Sri Lanka on Thursday supported setting up of a Saarc Development Bank for meeting infrastructure funding needs of countries in the region at low cost.
"We have been supportive of that from the beginning when it was mooted," Ajith Nivard Cabraal, Governor of the Central Bank of Sri Lanka, said on the sidelines of the India Economic Summit.
Cabraal said it would help in alleviating poverty in the region by offering block loans to banks which can be redistributed amongst the poorest section.
The bank would cater to South Asian Association for Regional Cooperation countries, comprising Afghanistan, Bangladesh, Bhutan, India, Maldives, Sri Lanka, Pakistan and Nepal. India had earlier set up a committee to examine the proposal for the bank.
During the meeting of trade ministers of SAARC countries in Bhutan in July, it was in-principally agreed to set up the bank. SAARC Development Fund, which was set up with a paid-up capital of $300 million and extends financial support to various social sector programmes, may be merged into the SAARC Development Bank.
Asked how soon it could start, he said, leaders may take a view on that in the next Summit. The talks of a SAARC Bank come close on the heels of BRICS leaders formalising the framework for the BRICS Development Bank.
He further said the proposed bank would have lot of synergies in the region and can help finance infrastructure development of the region.
