Sri Lanka plans to settle a debt for past oil imports from Iran by paying it off in tea

Ramesh Pathirana said his country hoped to send $5m (£3.8m) worth of tea to Iran each month to clear a $251m debt.

Sri Lanka is experiencing a severe debt and foreign exchange crisis, which has been made worse by the loss of tourist income during the coronavirus pandemic.

A member of the country's tea board said it was the first time tea had been bartered to settle foreign debt.

Mr Pathirana said the method of payment would not violate United Nations or American sanctions, because tea was categorised as a food item on humanitarian grounds, and no black-listed Iranian banks would be involved.

"We hope to send $5m worth of tea each month to repay Iran for oil purchases pending since the last four years," he told Reuters