Sri Lanka said on Friday it is looking at “alternate sources” of foreign borrowing after a sovereign rating cut this week that analysts expected would drive up the cost of loans. Sri Lanka, weighed down by the cost of a campaign against separatist rebels, needs $2.1 billion in foreign borrowing for 2009, out of which $500 million would be on commercial terms. It also has to repay $1 billion on its external borrowings in 2009. Sri Lanka can negotiate for more bilateral loans, especially from India, China and other friendly countries. But analysts expect it to get those on commercial terms instead of the current concessionary rates. Analysts also expect the government to strike a deal with Middle Eastern countries led by Iran to win postponements in payments for oil.