France and Sri Lanka signed a Financial Protocol relating to the extension of 10 million euros of soft loan (12 million US dollars) to Sri Lanka for the Water Supply Scheme, Daily News said in Colombo Monday.

The agreement was signed by Finance and Planning Ministry Secretary P. B. Jayasundera on behalf of the Sri Lankan government and by French Ambassador in Sri Lanka Jean Bernard de Vaivre on behalf of the French government.

The signing follows the conducting of a comprehensive project evaluation and appraisal and a detailed feasibility study, financed on a grant basis by France.

It was possible to put this major project into place rapidly before the passage of a year following the tsunami due to the hard work and co-operation by the authorities on both sides.

This financing complements the concessionary loan of 64 million euros already extended by the French Development Agency (AFD) for the Trincomalee Integrated Infrastructure Program.

It was upon Sri Lankan authorities request that France has concentrated its aid on the district of Trincomalee and that the French Ministry of Economy, Finance and Industry has agreed to fund the Greater Trincomalee Integrated Water Supply Scheme.

This new loan of 10 million euros (12 million dollars) conforms to the conditions announced by France in the beginning of 2005. Repayment of the loan will be over 20 years, with a grace period of 10 years and it will bear an interest rate of one percent per annum.

Source: Xinhua