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US concerned over unsustainable debt burdens to Sri Lanka by China

Under the USD 1.1 billion deal, the Chinese company will develop the deep-sea port of Hambantota

Press Trust of India  |  Washington 

debt funds
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The has expressed concern over the "unsustainable debt-burden" on due to non- concessional loans from

is investing billions of dollars in infrastructure development in


is struggling to repay Chinese money and recently signed an agreement to give a state-run Chinese firm a stake in the strategic Hambantota port as a way of paying down some of that debt.

Under the USD 1.1 billion deal, the Chinese company will develop the deep-sea port of Hambantota.

"is providing non-concessional loans that promote unsustainable debt burdens, which I think are increasingly now of concern to the Sri Lankan people in the government," Alice Wells, Acting Assistant Secretary of State for South and Central Asian Affairs told a Congressional subcommittee yesterday during a hearing on South Asia.

The has notably reduced its assistance to by 92 per cent.

"In Sri Lanka, we're the largest grant provider of assistance. is providing non-concessional loans that promote unsustainable debt burdens, which I think are increasingly now of concern to the Sri Lankan people in the government. But what we bring to our relationship are multiple tools," she said.

While there has been a significant percentage reduction in aid to Sri Lanka, Wells said the is using its tools to reinforce a message of reform, and to bring into a space where they too will institutionalise the principles of the Indo-Pacific -- freedom of navigation, transparency, non- militarisation humanitarian assistance and disaster relief at its core.

First Published: Fri, September 08 2017. 18:18 IST
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