By TON Sri Lanka

Sri Lanka has been defaulted on its debt as the country failed with its worst financial crisis in more than 7 decades. It happened after a 30-day grace period to pay off $78m (£63m) of unpaid debt interest payments expired on Wednesday and the country was now in an "anticipatory default".

The defaults happen when governments are incapable to meet their balance expenses to creditors. It certainly harms a country's reputation badly, making it borrow the money it needs on international markets, which further damages its currency and economy.

Sri Lanka is now in default its position is very clear until it becomes able to restructure debts. Until there is a debt restructuring in Sri Lanka it cannot repay. Sri Lanka is seeking to restructure debts of more than $50bn it owes to foreign creditors, to make it more manageable to repay.

The country's economy has been hit hard by the plague, increasing energy charges, and majority tax cuts. A prolonged scarcity of foreign currency and rising inflation and a severe shortage of medicines, fuel, and other essentials.

In recent weeks, there have been large violent, protests against President and his family due to the increasing crunch. The country has even now started talks with the International Monetary Fund over a bailout and desires to rearrange its debt contracts with creditors. The government has said previously that it needs as much as $4bn this year.

The central bank governor also warned that Sri Lanka's already very high rate of inflation was likely to rise further. Inflation obviously is around 30%. It will go even higher headline inflation will go upward in the upcoming months.

There won't be a hunger crisis. He was speaking after Sri Lanka's central bank held its two key interest rates steady following a seven percentage point rise at its last meeting. The country's main lending rate remained at 14.5%, while the deposit rate was kept at 13.5%

Previously, the world's main credit ranking agencies cautioned that Sri Lanka was about to default due to its debts. S&P Global Ratings made a similar announcement and said that a failure to pay is now a "fundamental certainty".

Last week, President elder brother resigned as prime minister after government supporters clashed with protesters. Nine people died and more than 300 were wounded in the violence. The family of brothers has dominated for years.

The ex-prime minister became famous among the majority Sinhalese in 2009 when his government defeated Tamil separatist rebels after years of acrimonious and bloody civil war. His brother who was defense minister at the time is now president.

On Friday, Sri Lanka's new prime minister told that the economic crisis was "going to get worse before it gets better. In his first interview since taking office, he also pledged to ensure families would get three meals a day.

Alluring the world for more financial help the new prime minister said that there won't be a famine crisis. Sri Lanka is an island nation off southern India: It won independence from British rule in 1948. Three ethnic groups - Sinhalese, Tamil, and Muslim - make up 99% of the country's 22m population.

Sri Lanka descended inescapably into default as the grace period on two unpaid foreign bonds ended the latest blow to a country rattled by economic pain and social unrest.

The island nation has been officially declared in default as it fails to make an interest payment to bondholders on Wednesday when the 30-day grace period for missed coupons on dollar bonds ended which marked its first default since its independence.

Now an economic crisis has led to fury on the streets and the rising price has meant food, medication and fuel are dearths. There are regular power failures and ordinary people have taken to the streets in anger with many blaming the president family and their government for the gory situation.