The World Bank is preparing an aid package for Sri Lanka, while the IMF describes loan talks as fruitful.

On Saturday, the International Monetary Fund said it had "fruitful technical discussions" with Sri Lanka about its loan request, while the World Bank said it was putting together an emergency aid package for the crisis-hit country.

Sri Lanka, a 22-million-person island nation, is struggling to pay for imports amid a crushing debt crisis and a sharp drop in foreign exchange reserves, which has fueled soaring inflation. Prolonged power outages and fuel, food, and medicine shortages have sparked nationwide protests.

Sri Lankan Finance Minister Ali Sabry is in Washington this week, meeting with the IMF, World Bank, India, and others about financial assistance for his country, which has suspended payments on portions of its $51 billion in external debt.

According to a World Bank spokesperson, the World Bank's emergency response package includes $10 million that will be made immediately available for the purchase of essential medicines, funds shifted from its ongoing COVID-19 health preparedness project.

The global lender, which held its spring meetings this week alongside the IMF, did not provide a total value for its package, but Sabry said on Friday that $500 million in aid was being considered.

According to a World Bank spokesperson, the package would leverage existing bank-financed projects and repurpose funds to provide medicines, school meals, and cash transfers to poor and vulnerable households as soon as possible.

Support for cooking gas, basic food supplies, seeds and fertilizers, and other necessities is also being discussed, according to the World Bank spokesperson, who added that the World Bank is "deeply concerned" about the situation in Sri Lanka.

In a statement issued on Saturday, the IMF stated that discussions among its staff focused on the need for Sri Lanka to implement "a credible and coherent strategy" to restore macroeconomic stability, strengthen its social safety net, and protect the poor and vulnerable during the current crisis.

"The IMF team welcomed the authorities plan to engage in a collaborative dialogue with their creditors," said Masahiro Nozaki, head of the IMF's Sri Lanka mission, in a statement issued after the country took steps to explore a restructuring of approximately $12 billion in sovereign bonds.

Sabry told reporters on Friday that discussions with the IMF were focused on a more traditional Extended Fund Facility program, but that $3 billion to $4 billion in bridge financing was required while this was finalized.

The IMF has stated that before it can make new loans to Colombo, Sri Lanka's debt must be put on a sustainable path, which could necessitate lengthy negotiations with China and the country's other creditors.

Sabry stated on Friday that, in addition to the IMF loan and World Bank assistance, Sri Lanka is discussing $1.5 billion in bridge financing with India to help continue essential imports, and that he has also approached China, Japan, and the Asian Development Bank for assistance.