THE Janata Dal and the Left believe India is already in the clutches of a foreign debt trap. Mukherjee disagrees vehemently, saying foreign loans are not bad if they are taken and converted into wealth so that the capacity is created for repayment. Only if foreign loans are used for consumption will the country fall into a debt trap. FICCI's Mitra agrees: "Although we have contracted over $100 billion in external debt, this is not an alarming fig-ure. With better performance of exports, we are now able to service debt in a more efficient manner." ASSOCHAM's Raghuraman does not fully agree with that. Though there has been a healthy shift from debt to non-debt creating flows in recent years, he says, the magnitude of debt remains large and disconcerting. ASSOCHAM is of the view that a prudent debt management strategy should be pursued through judicious commercial borrowings, especially, the costlier forms of debt; improved utilisation of existing aid programmes; liberal foreign investment policy and continued reforms in the trade regime. All agree foreign debt should be incurred only if it's inevitable. Says Modi: "Preference should be given to foreign equity rather than debt in the corporate sector. In the government sector, in any case, we shouldn't take any further debt." But George of the Muthoot group perhaps hits the nail on the head when he says that though ideally no foreign debt should be incurred, for the Indian Government there appears to be no choice. Irrespective of ideology.