Sri Lanka’s total external debt expanded by a massive 13.8 percent to US $ 28.4 billion (Rs. 3.5 trillion) last year with private commercial banks also raising loans in international financial markets, the 2012 Central Bank Annual Report reveals. External debt is defined as the portion of a country’s debt that is borrowed from foreign lenders, including commercial banks, Governments or international financial institutions.

“Total external debt and debt service payments of the country increased in 2012,” the report, released on Tuesday, said. “In US dollar terms, total outstanding external debt, which consists of medium and long term debt and short term debt, increased by 13.8 per cent to US $ 28.4 billion in 2012 from US $ 25 billion in the previous year.”

In 2012, therefore, total outstanding debt stood at 47.9 percent of GDP—up from 42.2 percent of GDP the previous year. This comprises foreign capital inflows to the Government in the form of medium and long term loans, including proceeds of the international sovereign bond, disbursements under the IMF Standby Agreement, foreign inflows to the Government securities market, and medium and long term foreign loans to public corporations.