CPEC The Indian Nightmare

[wiseone2]

So? Having 350 bn in forex means jack. If you are going to run into bankruptcy do you think all your 350 bn dollar will be used to pay off debt. I dont know what kind of pathetic econmics are taught in india where they are told debt is only good when you have this or that in Forex. Those who issue debt consider take many factors into account where projected economic growth is one important one.

If I have $1 million in debt and $800,000 in the bank I am in better shape.
I do not see what the issue is

 

[Ocean]

Pakistan’s total external debt and liabilities increased to $76.7 billion at the end of March 2017, according to the central bank. Foreign currency reserves held by the State Bank of Pakistan increased to $16.376 billion by June 23 following the release of three loans from the World Bank and the ADB.

In short external debt for Pakistan is more that 4 times the foreign reserves .. and the reserves themselves have been jacked up using foreign debt.

Apparently you have a zero iq, it will be ideal for trolls like yourself to go through this link to understand what the heck are froex reserves and what purpose they serve http://www.investopedia.com/terms/f/foreign-exchange-reserves.asp

Any loan that is issued factors in that porjects economic viability and potential returns besides seceral other indicators .In a country like pakistan where economic growth had been badly hit due to electricity shortages ,energy and infra projects hold tremendous potential in recovering capital investment in projected time periods.

 

[Ocean]

If I have $1 million in debt and $800,000 in the bank I am in better shape.
I do not see what the issue is

http://www.investopedia.com/terms/f/foreign-exchange-reserves.asp
when debts are issued only forex is not taken into account. If you have to talk about indian forex reserves then just also have a look at indian internal debt , the amount of money your central bank owes to other banks etc.

Secondly, loans are never issued as lump sum amount, they come in tranches. Do you think imf or world bank hand over loans in one fo . No. After one installment payment the project progress is monitored.

 

[wiseone2]

http://www.investopedia.com/terms/f/foreign-exchange-reserves.asp
when debts are issued only forex is not taken into account. If you have to talk about indian forex reserves then just also have a look at indian internal debt , the amount of money your central bank owes to other banks etc.

Secondly, loans are never issued as lump sum amount, they come in tranches. Do you think imf or world bank hand over loans in one fo . No. After one installment payment the project progress is monitored.

Let us discuss it in detail
Domestic debt - RBI prints money or govt raises taxes or cut spending to avoid default - GOI has a lot of options. GOP has some options.

Foreign Debt - without FOREX in hand you cannot pay foreign creditors. They want to be paid in US dollars or their currency (not Indian or Pakistani rupees)

Pakistan is in a bad position given falling exports and relatively low FOREX. India FOREX to foreign debt is 0.75. Pakistan ratio is 0.2

 

[My-Analogous]

Let us discuss it in detail
Domestic debt - RBI prints money or govt raises taxes or cut spending to avoid default - GOI has a lot of options. GOP has some options.

Foreign Debt - without FOREX in hand you cannot pay foreign creditors. They want to be paid in US dollars or their currency (not Indian or Pakistani rupees)

Pakistan is in a bad position given falling exports and relatively low FOREX. India FOREX to foreign debt is 0.75. Pakistan ratio is 0.2

If GOI have lots of options, then why GOI is taking loan first place?. If your case is considered correct then tell me where US (External debt 97% of GDP),UK (External debt 314% of GDP), France (External debt 210% of GDP) and many others system working?. If Your case consider true the India (External debt 69.5% of GDP) is batter then Pakistan (External debt 66.5% of GDP). Please explain?

 

[wiseone2]

If GOI have lots of options, then why GOI is taking loan first place?. If your case is considered correct then tell me where US (External debt 97% of GDP),UK (External debt 314% of GDP), France (External debt 210% of GDP) and many others system working?. If Your case consider true the India (External debt 69.5% of GDP) is batter then Pakistan (External debt 66.5% of GDP). Please explain?

Money is cheap. It is easier than selling assets.

India's external debt is $485 billion. India GNP is 2.2 trillion. Why is India external debt 69% of GDP ? The numbers are off

All American debt is dollar denominated. In that sense there is no external debt.
USA and to some extent UK attract capital from abroad. USA can print US dollars.
I would have to see who are holders of France's foreign debt are. Generally speaking if you are a country that
honors private property and have the rule of law wealthy people will move their money there.