Sri Lanka's central bank unveiled a far-reaching debt restructuring plan on Thursday aimed at restoring stability after an unprecedented economic crisis last year that led to the toppling of then-president Gotabaya Rajapaksa.

The bank said Thursday it was offering a 30 percent reduction on dollar-denominated bonds, including the international sovereign bonds (ISB) that make up more than a quarter of Sri Lanka's total foreign debt.

This was revealed by the Central Bank Governor Nandalal Weerasinghe, who noted that the move is expected, stressing that negotiations with bilateral creditors were continuing.

Bilateral lenders were spared but will be asked to extend the maturity of their loans up to 15 years at an annual fixed interest rate of 1.5 percent, with a nine-year moratorium on interest payments.

The move comes after Sri Lanka cut subsidies, doubled taxes and promised to privatise hundreds of state enterprises under a 2.9 billion Dollar International Monetary Fund bailout agreed in March.

The agreement requires Sri Lanka to reduce its debt servicing by two-thirds in the next four years, to balance its books and restore the bankrupt island nation's finances.

Colombo had expected foreign debt restructuring to be completed by last August but it was held up when China, its largest single creditor, initially refused to take a haircut and instead offered more loans to pay off old debts.

China holds about 52 percent of the South Asian nation's bilateral credit, with Japan and India the next biggest lenders.