GANDHINAGAR, INDIA (AP) – On the heels of a trip to Beijing, United States (US) Treasury Secretary Janet Yellen is back in India for the third time in nine months, this time to meet finance ministers from the Group of 20 nations about global economic challenges like the increased threat of debt defaults facing low-income countries.
Yellen told reporters in Gandhinagar, the capital of the western Indian state of Gujarat, yesterday that she was trying to foster warming relations between the US and India.
She also plans a stop in Hanoi, Vietnam, to address supply chain reliability, clean energy transition and other matters of economic resilience.
Yellen said her goals in India were to press for debt restructuring in developing countries in economic distress, push to modernise global development banks to make them more climate-focused and deepen the ever-growing US-India relationship.
The US increasingly relies on India and has courted its leaders.
She said the US sees India as an indispensable partner in its friend-shoring strategy for increasing the resilience of supply chains. She added private US firms sees India as an excellent place for producing goods and exporting to the US.
She also noted that slowing growth in China has impacted growth in many other countries.
US President Joe Biden hosted a White House state visit honouring Indian Prime Minister Narendra Modi in June, designed to highlight and foster ties.
The two leaders pronounced the US-India relationship never stronger and rolled out new business deals between the nations.
A senior Treasury official, speaking on condition of anonymity to preview Yellen’s trip, said there was hope that debt treatments for Ghana and Sri Lanka will be discussed and completed quickly at the meetings.
Sri Lanka and Ghana defaulted on their international debts last year, roughly two years after Zambia defaulted. And more than half of all low-income countries face debt distress, which hurts their long-term ability to function and develop.
Last month, Zambia and its government creditors, including China, reached a deal to restructure USD6.3 billion in loans, on the sidelines of a global finance summit in Paris.
The agreement covers loans from countries such as France, the United Kingdom, South Africa, Israel and India as well as China – Zambia’s biggest creditor at USD4.1 billion of the total.
