Sri Lanka Crisis: How Sri Lanka's economy got derailed while walking on the path of speed, which created a ruckus, know - China's role in this
Sri Lanka was once on the fast-growing list. This country had done the work of astonishing the whole world. But then suddenly the situation there started deteriorating and it got so bad that people came on the streets. Why did this happen?
The ongoing political and economic unrest in India's neighborhoods has attracted the attention of the whole world. India is also eyeing the economic and political plight of Sri Lanka. India's concern is somewhere or the other that China should not take advantage of this. The prices of food items in Sri Lanka are skyrocketing. At the same time, there is also anger among the people regarding the political situation. It is very important to know why the condition of this country, which is swinging between political upheavals and economic difficulties, has become like this. This is because once Sri Lanka was moving fast on the path of progress. If experts are to be believed, then Sri Lanka itself is responsible for this.
The special role of tourism in the economy of Sri Lanka
In the opinion of experts, one of the reasons for this plight was the spread of the corona epidemic in the world, over which no one had any control. Its effect was seen all over the world. Professor Harsh V Pant of Observer Research Foundation says that Sri Lanka's economy rests on tourism. People from all over the world come here to see the natural beauty of this place. The share of tourism in the GDP here is about 12.5 percent. Its speed did not decrease before Corona. But worldwide sanctions derailed it. After this, the steps were taken by the government also made the situation worse.
Sri Lanka was on the road to progress
Sri Lanka has been in the grip of civil war for a long time. Even after this, this country has progressed more rapidly than many countries. Sri Lanka has also performed well in the United Nations Human Development Index. Professor Pant says that the reason for Sri Lanka's plight has been its wrong policies. Signs of Sri Lanka's misfortune were already visible.
Tax Rate Cut
The biggest loss to Sri Lanka's revenue has been the reduction in the tax rate. The government's decision was also questioned by global credit rating agencies. Due to this decision, it became difficult to mobilize financial resources from Sri Lanka's international financial system at an affordable rate. China took advantage of these situations and Sri Lanka became dependent on China. This country, already under the burden of debt, became more indebted.
Wrong Agricultural Policy
The country also had to bear the brunt of the wrong policies implemented in the agriculture sector. The government banned the use of chemical fertilizers. This directly affected agriculture and grain storage. The government ignored the fact that it is not possible to move towards organic farming overnight. As a result, traditional agricultural production lags behind. Although the government later withdrew this decision, by then it was too late. Signs of a food crisis were starting to show in the country. At present, the country is facing a severe food crisis and the economy has also collapsed badly.
Heavy friendship with china
One of the reasons for Sri Lanka's plight has been the Rajapaksa family's excessive proximity to China. Sri Lanka worked to distance itself from an old friend like India because of China. Now that Sri Lanka is standing on the edge of poverty, China has turned its back on it. At present, China is expressing regret over this situation from afar. China has categorically refused to give any concession on the loan given to Sri Lanka. At the same time, Sri Lanka has again remembered India in bad times.
India remembered in difficult times
India has also done its duty well. India has provided a line of credit to Sri Lanka for the supply of essential items. India is also sending food items to Sri Lanka, including thousands of tonnes of rice and diesel petrol. India has given a loan of Rs 6,500 crore to Sri Lanka in the first two months of this year itself. Apart from this, in the coming days, India will provide a loan of Rs 7,500 crore to Sri Lanka.