May 5, 2023
2 mins read

Indonesia’s increasing dependence on China raises alarm bells

Indonesia is worried about falling into a financial trap similar to Sri Lanka, which was compelled to lease Hambantota Port to China in exchange for debt relief…reports Asian Lite News

Indonesia, the largest economy in Southeast Asia has grown its debt to China over time and used more Chinese yuan in its international trade. Indonesia will find it more challenging to fend off China’s escalating aggression in the South China Sea as it becomes more dependent on China, Nepal-based online magazine e-Pardafas reported.

According to a recent report of Nikkei Asia, in December 2022, the Kereta Cepat Indonesia China (KCIC) railway requested extending the 50-year concession it had for a high-speed train that was being built in Java for an additional 30 years. Indonesia is worried about falling into a financial trap similar to Sri Lanka, which was compelled to lease Hambantota Port to China in exchange for debt relief, as the railway would remain under Chinese control if the Indonesian government is unable to reject the proposal.

Several African nations have also experienced this situation. According to a report by AidData, the KCIC rail line, which was financed with a USD 4.5 billion Chinese loan and is part of China’s Belt and Road Initiative (BRI), has left Indonesia and many other nations with a pile of unreported debt. The train project is 40 per cent owned by Chinese companies, e-Pardafas reported.

It’s probable that Jakarta’s worries about a potential 80-year concession are not unwarranted. The Hambantota Port in Sri Lanka was leased to China in 2017 for 99 years after the Sri Lankan government started having trouble repaying construction debts.

The incident is seen as a classic example of “debt trap diplomacy,” in which a creditor country offers an excessive amount of loans before demanding political or economic concessions when the debtor nation is unable to make repayments. In this instance, China was successful in seizing control of the crucial port for global geopolitics in the midst of the Indian Ocean.

More than ten years ago, Chinese President Xi Jinping unveiled the Belt and Road Initiative (BRI), a vast infrastructural project with the objective of extending Chinese influence and goods around the world. Since then, more than 150 nations have reached agreements with China because they are desperate for resources and infrastructure, e-Pardafas reported. (ANI)

ALSO READ: IAF chief calls on President Wickremesinghe in Colombo

Previous Story

IAF Chief discusses ties with Lankan PM Gunawardena

Next Story

Uyghurs’ plight overlooked, says alarming report

Latest from -Top News

‘Kill and Dump’ Haunts Balochistan Again

The latest killings have reignited accusations of extrajudicial executions and the use of counterterrorism laws to cover up custodial deaths in Balochistan….reports Asian Lite News Concerns have deepened across Balochistan following the

‘ASEAN Expands, But Keeps Its Soul’

Malaysian Foreign Minister Mohamad Hasan urged ASEAN to uphold its unity and strategic resolve amid intensifying geopolitical tensions and mounting external pressures…reports Asian Lite News Consensus and inclusivity will remain the cornerstones

Bangladesh bends to beat Trump’s blow

Dhaka seeks compromise as Trump’s 35% tariff looms large over key exports; Washington urges worker protections, factory relocation to US…reports Asian Lite News Bangladesh has opened the second round of critical trade

China seethes as US lands F-35s in PH

As US F-35 jets land in the Philippines for the first time, Manila cements its frontline role in Washington’s power play against rising China….reports Asian Lite News The Philippines is rapidly cementing
Go toTop

Don't Miss

US to hike India aid in clean energy, digital economy

The Biden Administration has also proposed to increase aid to

India Embraces Digital Twins Rapidly

The ‘Virtual Twin’ adoption in India could play a crucial