Is India actually helping other counties when it is itself a developing economy?

Sri Lanka is a sovereign country dependent on tourism and other local industries to survive.

Being a small country and comparatively not very financially strong, it is normal to accept help/loans/donations/emergency aid from financially strong neighbors.

India has approved an amount of $1 Billion as credit; essentials like rice and medicines have also been sent. It has also announced the development of three wind farms in Sri Lanka with a budget of $12 Billion to cater to Sri Lanka’s power needs.

As an immediate measure, the Indian Oil Corporation (IOC) has decided to release 6,000 MT of diesel to help Sri Lanka fight the fuel shortage.

As of now, India can’t do anything immediately to revive the Sri Lankan economy, until & unless its government reviews the tax system. The current regime had reduced the tax rates as per their election promises which have caused a heavy reduction in revenue collection.

Tourism became a casualty of COVID-19 generated pandemic & the foreign exchange reserves are in a very bad state resulting in curbs on essential imports.

A major part of Sri Lanka’s revenue is spent on the payment of interest on external debt (especially China’s); heavy debt from external institutions for the infrastructure projects appears to be the main villain here.

India has voluntarily extended the line of credit so that the Sri Lankan government can import fuel and other essentials.

The following videos by India In Details (https://www.youtube.com/c/IndiaInDetails/featured) throw light on the selfless humanitarian gestures of India towards the nations in need of emergency supplies during times of crisis:

Watch & share to spread the good word!