The World Bank is planning to disburse USD 700 million to crisis-ridden Sri Lanka by re-purposing its existing loans, a move that will help the island nation grappling with an unprecedented economic crisis much-needed breathing space till a bailout package with the IMF is worked out, media reports said on Monday.

Sri Lanka is nearing bankruptcy and has severe shortages of essentials from food, fuel, medicines and cooking gas.

For months, citizens have been forced to stay in long lines to buy the limited stocks.

The World Bank Country Manager Chiyo Kanda met Sri Lankan Foreign Minister last week and assured him that the agency will work with the Asian Development Bank (ADB), Asian Infrastructure Investment Bank (AIIB) and the UN office to re-purpose their already committed projects, news portal Colombo Gazette reported.

Minister Peiris sought assistance from the World Bank until long term assistance materialises through the IMF, other international institutions and donor countries, the report said, quoting a statement from Sri Lanka's Foreign Ministry.

Consequently, Kanda has assured Peiris that the global lender would disburse USD 700 million to Sri Lanka in these difficult times in the coming months, the report said.

Earlier this month, the International Monetary Fund (IMF) said it remains committed to assisting Sri Lanka in line with its policies, the Colombo Gazette reported.

Technical-level discussions with Sri Lanka have commenced. They will continue in order to prepare for policy discussions once a new government has been formed, the IMF was quoted as saying by the report.

On our virtual mission during May 9-23, discussions at the technical level have just started and continued as planned so as to be fully prepared for policy discussions once a new government has been formed, the IMF said in a statement.

The IMF also said that it is following developments in Sri Lanka closely and is concerned about rising social tensions and violence.

In April, the two sides convened their first round of talks at the IMF headquarters in Washington.

Sri Lanka is hoping for a Rapid Finance Instrument (RFI) facility as well as a larger Extended Fund Facility (EFF) from the international financial body to help it deal with its foreign currency shortages, which have triggered an economic crisis.

In the last meeting, the IMF assured to help the country with an amount of USD 300 million to USD 600 million.

On April 12, Sri Lanka suspended its debt servicing for the first time in its history.

The island nation has been facing its worst economic crisis since its independence from Britain in 1948.

The economic crisis has also triggered political unrest with a protest occupying the entrance to the president's office demanding his resignation has been continuing for more than 50 days.