Sri Lanka suspects EU hand in loan delay but confident

However, US opposition to Sri Lanka’s request for a $1.9 billion IMF standby facility appears to be waning.

US Congressman Heath Shuler who was in Sri Lanka recently told reporters in Colombo that Sri Lanka deserves the loan for its development.

During the final phase of the war in Sri Lanka, US Secretary of State Hillary Clinton said that “it was not the appropriate time to consider granting a massive IMF loan for Sri Lanka.’’

Asked to comment on Clinton’s statement, Shuler said that this was not the message he was getting from the authorities and also it is vital to separate economic issues from politics.

Following Clinton’s statement, Central Bank of Sri Lanka Governor Nivard Cabraal had said: "There is nothing in the governance structure of the IMF to indicate any political consideration be taken into account."

Also, the IMF has moved to asked the US Supreme Court to lift dismiss a case seeking to force the US to deny Sri Lanka the loan, arguing that the plaintiff has no standing, the court lacks jurisdiction, there is no private right of action to enforce "policy goals," and under federal law both defendants - Timothy Geithner, Secretary of the Treasury, and Meg Lundsager, Executive Director of the IMF - are immune from legal prosecution.

Tamils Against Genocide (TAG), which filed the original suit, is considering a response, but their ;lead counsel said he is leaning towards dismissing the IMF lawsuit voluntarily and let the political processes unfold.

"The resources needed to provide an effective rebuttal to the Government's position is very high," he told TamilNet.

Meanwhile, a number of humanitarian and rights organisations including Human Rights Watch, Amnesty International, International Crisis Group, the Global Centre for the Responsibility to Protect, have urged the US other IMF member countries to block the loan to Sri Lanka.