Also, the Sri Lankan government will sell long-term visas to attract foreign currency after the island nation ran out of dollars to pay even for food and fuel in the wake of a crippling economic crisis.
Worsening economic crisis has sparked countrywide protests in Sri Lanka, with angry demonstrators camped outside President Rajapaksa's office for more than three weeks.
Prime Minister Mahinda Rajapaksa says he is deeply distressed by violence in the town of Rambukkana and hopes for a fair investigation after the first death during weeks of demonstrations.
The power transfer from president to parliament will be one of the steps aimed at politically stabilising the crisis-hit country, Prime Minister Mahinda Rajapaksa says.
President Gotabaya Rajapaksa's older brother, Prime Minister Mahinda Rajapaksa, remains but some other relatives have been dropped in what's seen as an attempt to pacify protesters amid an economic crisis.
The moves — announced separately — are aimed at cooling widespread social tensions and bringing in liquidity to fight a crippling economic crisis that has triggered unprecedented hardship in the nation of 22 million people.
Sri Lanka's Finance Ministry said creditors, including foreign governments, were free to capitalise any interest payments due to them or opt for payback in Sri Lankan rupees.
The heavily indebted country has little money left to pay for imports, which has led to crippling shortages of fuel, power, food, and increasingly, medicines.
Gotabaya Rajapaksa has revoked orders giving him sweeping authority to act in the interests of public order, including suspending any laws, authorising detentions and seizing property.
President Gotabaya Rajapaksa's ruling has coalition suffered a string of defections ahead of the parliamentary session, undermining his ability to ratify a state of emergency imposed last week to quell the growing public protests.
The south Asian country is facing severe shortages of food, fuel and other essentials – along with record inflation and crippling power cuts – in its most painful downturn since independence from Britain in 1948.
Sri Lankan forces moved to stop a protest by opposition lawmakers and supporters attempting to march to the capital's Independence Square from the home of opposition leader Sajith Premadasa.
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