COLOMBO, June 28 (Xinhua) -- Sri Lanka's cabinet approved on Wednesday a plan for domestic debt restructuring, the President's Media Division (PMD) said.

The PMD said the domestic debt restructuring program was proposed by the finance ministry and approved by the special cabinet meeting unanimously.

Sri Lankan President Ranil Wickremesinghe said earlier that the debt restructuring process would not affect the stability of the banking system.

State Minister of Finance Ranjith Siyambalapitiya told parliament earlier that domestic creditors would not be compelled to take a haircut during the restructuring of domestic debt.

Siyambalapitiya said that debt moratoriums, reducing interest, and delays in payments can also be ways to restructure domestic debt.

Sri Lanka announced a suspension of foreign debt repayments in April 2022, when it was hit by its worst financial crisis since independence.

Sri Lanka has already undertaken to restructure its external debts in keeping with the program with the International Monetary Fund.