G20 Sherpa Amitabh Kant. , Photo Credit: ANI
India’s G20 sherpa has said in a rare, direct reference to Chinese debt to developing countries that China should agree to cut its debts to poor countries and aid their economic recovery.
Amitabh Kant said, “China needs to come out in the open and tell what is their debt and how to repay it.” Bloomberg news report. “It cannot be that the International Monetary Fund takes a haircut and goes to settle the Chinese debt. how is that possible? Sherpas are quoted as saying that everyone has to get a haircut.
Read also: Cancel Sri Lanka’s debt, global scholars tell creditors
While the United States has been an outspoken critic of Chinese debt to developing countries, with its top officials often commenting on the top Asian lender’s role in the restructuring process, India rarely mentions China when commenting on countries’ sovereign debt. Is.
sovereign debt roundtable
Mr Kant’s remarks assume significance ahead of a scheduled virtual meeting of the Global Sovereign Debt Roundtable organized by the International Monetary Fund (IMF), the World Bank and India, which is leading the Group of 20 major economies this year. The virtual roundtable on February 17 will be followed by an in-person meeting in Bengaluru on February 25. PTI The news agency reported from Washington DC.
The meeting will not have “country-specific” discussions, but will focus on broader issues “obstructing access to a timely debt restructuring process”, and lessons from recent cases and possible technical solutions to address shortcomings, the IMF said. Sela Pazarbasioglu, director of the Strategy and Policy Review Department, told reporters. Officials from creditor countries including China, India, Saudi Arabia, the United States and Group of Seven (G7) members are expected to attend.
case of sri lanka
Meanwhile, Sri Lankan President Ranil Wickremesinghe said on Wednesday that the debt-ridden island nation hopes to… IMF’s $ 2.9 billion package By March to bring the country’s economy on the path of recovery after last year’s painful financial crash.
They had set a target of tapping the IMF aid by the end of 2022, but processing delayedBecause Sri Lanka was unable to obtain adequate financing assurances from its creditors – a pre-requisite for the crucial IMF program – by the end of last year.
China, Japan and India are Sri Lanka’s top three bilateral creditors, and India becomes first among them to send written funding assurance To the IMF on 16 January. The Paris Club, an informal group of creditors of which Japan is a member, followed suit.
Although the Export-Import Bank of China has offered Sri Lanka a two-year moratorium, Beijing has yet to provide specific financing assurances to the IMF to help Sri Lanka unlock a $2.9 billion “bailout package”. which Colombo is fully counting on for reconstruction. its economy.
Chamber Appeal
The Ceylon Chamber of Commerce has urged China to act swiftly, appreciating the “timely announcement” by India and the Paris Club members on their funding assurances. “The Chamber appreciates the support given by China in Sri Lanka’s economic development and requests [China] To work with the IMF to get Sri Lanka as a major bilateral creditor its much-awaited funds, the island’s apex business body said in a recent statement.
India and the Paris Club have stressed the need for equal treatment of all bilateral creditors, effectively indicating that China should not get any concessions in the process. Asked whether Beijing would agree to a debt reduction, a foreign ministry official said associated Press on Wednesday that China is “willing to work with relevant countries and international financial institutions to play a positive role in helping Sri Lanka overcome the current difficulties.”
However, it remains to be seen whether China will get on board by sending financial assurances to the IMF, especially since Beijing has indicated that Sri Lanka’s multilateral loans should also be cut. Chinese Foreign Ministry spokesman Mao said, “China calls on all other creditors of Sri Lanka, especially multilateral creditors, to take synchronous, similar steps and provide effective, strong support to help the country emerge from the default situation as soon as possible.” asks for.” Ning said at a media conference earlier this month.