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In 2022, low- and middle-income countries spent a record US$443.5 billion on external public debt servicing, diverting funds from crucial sectors like health, education, and environmental conservation. Projections indicate a 10 percent increase in debt servicing expenses for all developing countries in 2023–24, with low-income countries facing nearly a 40 percent rise. This ongoing debt crisis in the Global South highlights the need for innovative solutions.
This article advocates why India and Sri Lanka would gain from engaging in green debt swaps, with a focus on India’s motivations and potential benefits. Sri Lanka has long grappled with financial challenges such as high debt levels, insufficient foreign…
