Tag : Chinese

    Caught In Chinese Debt Trap, India's Neighbours Stare At Economic Ruin

    Chinese
    Sunil Aswal
    April9/ 2022

    New Delhi: Indias neighbourhood, especially Pakistan and Sri Lanka, is in peril as the Chinese debt trap strangulates these economies. After taking huge debt from China, servicing it is becoming a crisis for these nations, giving rise to fears of a sovereign default. In order to avert the Balance of Payment (BoP) crisis, Pakistan has made alternate plans for meeting the yawning dollar financing gap for avoiding plunging into a full-fledged crisis till the stalled IMF programme is restored, The News reported. Pakistan requires dollar inflows on an immediate basis to restore confidence, as the current account deficit has risen sharply while the foreign currency reserves are depleting at an accelerated pace. Pakistan and the International Monetory Fund (IMF) are so far unable to strike a consensus on the completion of the 7th Review and release of the $960 million tranche under the $6 billion Extended Fund Facility. The IMF has indicated holding talks with the 'new' government and keeping in view the fluid political situation, the restoration of the IMF programme seems in danger. Top official sources said that China had agreed in principle for granting a rollover of a $2.5 billion commercial loan last week, but so far Beijing authorities are processing its rollover, The News reported. However, there is another possibility that the Chinese might have refused to roll over loans earlier, but after intervention at the highest level when Pakistan Prime Minister Imran Khan visited China, Beijing authorities might have shown willingness to move ahead, the report said. Sri Lanka has plunged into the worst economic crisis since its independence in 1948, after President Gotapaya Rajapaksa announced an economic emergency in September 2021, Glob ...

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