A spokesperson for the US Department of State has been quoted saying that America’s decision to truncate aid to Sri Lanka was due to the islands classification as a middle income country.
US Secretary of State John Kerry has proposed a 20 per cent cut in American aid to Colombo.
It is believed to be the highest drop for any South Asian country in Kerry's budgetary proposals which was sent to the Congress last week for its approval.
In actual term, Kerry has proposed 11 million USD in aid to Sri Lanka, which, according to a senior State Department official, is a "drop of 20 per cent" from the actual spending in the 2012 fiscal.
While the actual US development assistance to Sri Lanka in 2012 was 8 million USD, Kerry has proposed about 6 million USD for 2014.
Kerry has proposed similar amount of development assistance to Bangladesh from 81.6 million USD in 2012 to 80.9 million USD in 2014.
Kerry has proposed substantial increase in US aid to Maldives - Sri Lanka's neighbor.
Majority of the US funds to Sri Lanka would go into key projects related to judicial reform and increasing Maldives counter-terrorism efforts.