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ஜெனரல்
The concept of 'debt-trap diplomacy' is often attributed to China's lending practices, especially under the Belt and Road Initiative (BRI). It's suggested that China loans money to poorer nations for large infrastructure projects under stringent terms, making repayment difficult and potentially leading to economic or political concessions in China's favor. While exact details of Chinese lending are not public, it's known that China is now the world's largest official creditor, with significant investments in developing countries.
Cases like Sri Lanka and Pakistan are cited as examples of the negative impacts of Chinese lending. In Sri Lanka, failure to generate sufficient revenue from Chinese-funded projects like the Hambantota Harbour led to economic crisis and political turmoil. However, it's noted that Chinese loans were only part of Sri Lanka's debt issue, and factors like government policy and corruption also played major roles.
Contrastingly, many countries view Chinese loans positively, seeing China as a key growth catalyst. Unlike traditional lenders like the World Bank and IMF, China doesn't impose policy changes or review credit histories. The situation is juxtaposed with India's current economic scenario, where heavy borrowing has raised IMF concerns. Despite these concerns, Indian officials maintain that the situation is manageable due to a strong GDP growth rate and a low percentage of foreign debt. However, the rising interest payments and deficit financing suggest potential financial challenges. The summary concludes with the emphasis on the importance of responsible economic management over reliance on extensive borrowing.
