Know: Sri Lanka's Neighboring Country India Can Also Face Economy Crisis?

If all the questions arise regarding the crisis in Sri Lanka, then the question also arises in that whether Sri Lanka's neighboring country India can also face this crisis?

This Could be the reason for all the troubles,

1. Political Crisis

2. Economic Crisis

3. Social Crisis

Here is a crisis that happened in Past,

2021 In South America came the economic crisis in Venezuela.

2022 In South America came the political crisis in Argentina.

the political, economic, and social crisis is going well together, but they are rarely seen.

If even one of these 3 does not work, then the public becomes Angry and the prime minister has to leave the country and run away.

That's what Sri Lanka is going through.

The political, economic, and social crisis in Sri Lanka was ignored and because of the crisis came.

For this reason, Sri Lanka Prime Minister Mahinda Rajapaksa had to be removed from the post of Prime Minister, which caused a political crisis.

In This Country the price increased and the local people came out on the streets .

After Mahindra's resignation, Sri Lanka President who is Mahindra Rajapaksa's brother Gotabaya Seeing the deteriorating condition of the country, he decided to run away from Sri Lanka And after a few days of letter, via email from Singapore, he resigned from his position.

During the Sri Lanka crisis, some people created a ruckus on the streets and some people entered the Prime Minister House And there was bad behavior and the police had fight with people to control it all. Curfew was imposed in Sri Lanka for a few days.

Whatever happened in Sri Lanka, some videos or pictures of the local public went viral on Twitter, Facebook.

Seeing this, the political experts of the country appealed to the world to control the deteriorating situation in Sri Lanka.

More than 50 people have died and more than 1000 people have been injured in this protest.

21 July 2022, United National Party leader Ranil Wickremesinghe, the new President of Sri Lanka took over as the new President, but still the deteriorating situation in the country has not yet been controlled.

Sri Lanka and all its neighboring countries are going through this crisis, at the same time Indian economy is managing itself.

India's economical strength is surprising all the experts of the world.

WHY SRI LANKA TYPE CRISIS CAN'T HAPPEN IN INDIA?

Image From Pintrest

Sri Lanka was one of the top development Country in Asia a few years back.

Sri Lanka may be better than India in terms of GDP, but has been ahead of India in terms of personal income.

Some time ago India's GDP per capita income was $2515 while Sri Lanka's per capita income was $3830.

Sri Lanka's performance in health facilities, education, and income has been excellent And It has performed better than India in terms of The Human Development Index.

In 2022, where India's ranking was 131 in the Human Health Index, Sri Lanka was ranked 58.

In terms of literacy, Sri Lanka was ahead of the Asian country as well.

the number of educated people in this small neighboring country of ours is 92 percent of the total population of the country.

the question arises that, Sri Lanka country in which people have got the education, which has good person income and health development is also good, why is this country still like this, and how can such turmoil arise?

Let's see, 

Which reason the crisis has come in Sri Lanka?

1. The weak and deteriorating economic condition of Sri Lanka.

The reason for Sri Lanka's crisis is the weak economic structure of the country, And Secondly, rising foreign debt, problem of double deficit, lack of revenue sources, gold and dollar reserves, and domestic savings in the country weakened Sri Lanka's economic structure.

On the one side, Sri Lanka was performing brilliantly in health and education, while on the other side the economic fund was being filled in a political crisis.

According to the info sector a few months back, Sri Lanka had spent a lot of money on education, infrastructure, and health but could not find any new source of income for the expenditure.

Sri Lanka Starts Taking Loan From Outside For Deficit Between Income And Expenditure. And got a loan from the International Monetary Fund or the World Bank, through which Sri Lanka met its education, health, etc. needs. But could not return the funds.

From 1965 to 2021, Sri Lanka has taken loans 16 times and not been able to repay that time. Sri Lanka's government could not repay a loan from IMF.

According to the April 2022 International Monetary Fund report, Sri Lanka failed to repay the loan of 51 billion dollars, And yet the crisis of Sri Lanka was increasing and started taking loans from the Other countries in the name of infrastructure development, internal security, etc.

Some other countries helped Sri Lanka well and some countries to their advantage, and in this, China was one of them.

China gave loans to Sri Lanka for infrastructure development Because seeing the situation in Sri Lanka.

somewhere China knew that Sri Lanka would not be able to repay this loan.

An Example, the Hambantota port built in Sri Lanka.

China proposed to develop Hambantota port despite being aware of the fact that Sri Lanka will not be able to pay back the loan.

This project was developed by China and Sri Lanka together and Sri Lanka could not be filled Loan on time.

Due to this Hambantota port has been leased to China for 99 years.

According to the IMF, Sri Lanka has increased debt from the neighboring country And because of twin deficit started happening.

Twin deficit means the country is facing both a current account deficit or a fiscal deficit. Fiscal deficit is high in the income or revenue sources of government expenditure and due to this, the government is forced to take debt And Current account deficit in which the country's goods, services and investment sources are less.

The biggest reason for the economic crisis in Sri Lanka was the lack of revenue sources and forex revenues.

Sri Lanka is a beautiful island where the tourism revenue generating area But apart from tourism, Sri Lanka did not pay attention to the development of independence.

Sri Lanka's import bill has been increasing steadily since 1998. According to the expert, Sri Lanka's economy was highly dependent on the tourism sector which was damaged during the pandemic And that caused Sri Lanka to increase import bills for energy and food.

Sri Lanka had to deplete foreign exchange reserves to get something new. After some time it happened that the country did not have dollar and gold reserves and Due to both these reasons, the country's economy became more down.

2. Family Political Power

If all the people in a country are in one person, one family, or one industry, then that country will not be a democratic country and that Same happened in Sri Lanka. 

political power in the hands of a Single-family, The reason for this was that the Rajapaksa family did not turn out to be healthy for Sri Lanka.

As of February 2022, there were a total of 5 senior positions with the Rajapaksa family in Sri Lanka And because of that, the country became weak.

In the post of changing leader in Sri Lanka, the use of appeasement politics is also the reason for the pitch of crisis in the country. When one government came up with a policy, the other government used to stop using it. Because of this, the government was unable to put a hold on long-term goals and long-term vision. New avenues of employment did not open in the country and No new parliament was formed in the country. Due to the work in revenue, the government started taking many loans.

The main reason for the crisis in Sri Lanka was that their government did not maintain a healthy balance, which rests on revenue and expansion.

For This Reason, the government took a loan on loan and the crisis increased.

The Government of India should try to reduce its expenditure, increase revenue and reduce the debt to GDP ratio. And privatized The Air India unit to meet expenses.

The government has also focused on increasing revenue from GST, corporate tax reforms, skill development program research, etc. And they have made many Committees to manage The proper budget while maintaining physical health.

1. FRBM Act 003

2. NK Singh Committee in 2016

Sri Lanka took loans from countries like IMF, World Bank Or China. China implicated Sri Lanka.

The Government of India has consistently tried to keep working on the GDP ratio.

Taking a loan is not a bad thing, it is necessary to take a loan for the development of the country.

And it should be revenue to repay the loan on time.

As we have seen in the crisis in Sri Lanka, there was a lack of revenue sources and the lack of forex resources was also the main reason.

It is a matter of great concern that India is not dealing with such things.

Today India has more revenue and there is good growth in foreign exchange reserves. India continues to expand into BPO, KPO, Medical Consultancy and Hospitality Industry, and Service Sector.

Along with the service sector, the manufacturing sector is also developing.

Make in India and StartupIndia helped our country to work on the import bill. And in this energy-sufficient war, India has got political and economic support.

The government of India has promoted the source of the country's revenue with the International Solar Alliance.

In the recent Russia-Ukraine war, India's government has already bought crude oil from Russia at a low price. Due to this the foreign exchange reserves also did not decrease.

Today, India's Government and Reserve Bank of India have $672 billion in forex reserves.

On the basis of a report, India is at the fourth position with foreign exchange reserves of $ 672 billion. Foreign remittances from NRIs further strengthen RBI's reserves.

Today India earns more dollars because of the 18 million Indian diasporas living in the world and because of that the economy grows.

The reason for the Sri Lankan crisis is the entry of a family into politics. Indian democracy is much stronger than Sri Lanka because political power is not concentrated in the hands of one family.

Today India's government is ready to cooperate in the problem of Sri Lanka, but the outside government will not do anything.

Sri Lanka's recovery depends on the leader of Sri Lanka and the people of Sri Lanka Because the life of the people living there should be good again and get rid of the crisis if they will understand.