Scenes from the documentary stated that the mechanism of debt was a …show more content…
Increasing levels of imports and less dependency on self production of commodities had been responsible for fuelling the crisis further. Pressure from the IMF to opt for debt financing in order to bring the fiscal policy under stable condtions and instigate economic growth had been longing for a considerable time period. For instance, in a post-independence speech during 1996 the former prime minister actually condemned the IMF and stated that they will not seek anyone’s intervention and assistance. However, gradually due to a lack of other viable alternatives debt contacts had to be signed with the IMF. Such a trend can be rather said to be global trend for all the third world nations. Such developments had led to the need for generation of excess amounts of foreign exchange funds to meet the interest payments which was not very much feasible. And under such circumstances, the IMF prescribed the imposition of high interest rates, devaluation of the local currency and redefined wage guidelines. However,