With global inflation rising and the fear of fuel and food crises looming large, clouds are gathering on the economic horizon of South Asian countries. Sri Lanka in particular remains mired in a crisis driven by a mix of high indebtedness, soaring inflation and poor economic management.
Once projected to become the Singapore of South Asia, Sri Lanka in May became the first country in the Asia-Pacific region in 20 years to default on foreign debt. President Gotabaya Rajapaksa flew to Singapore to escape a popular uprising and subsequently resigned. Now his successor is trying to clean up the mess, but the World Bank has warned that no more money will be forthcoming unless the government carries out "deep structural reforms".
Sri Lanka may not be alone. Some economic analysts say the same global headwinds -- supply chain bottlenecks, inflation, currency depreciation and depletion of foreign currency reserves -- are pushing some other South Asian economies to the brink.
