Krishnamurthy Subramanian, Executive Director of the International Monetary Fund (IMF), stresses the importance of distinguishing between productive and unproductive debt. He warns that taking debt for freebies or revenue expenditure can lead to a debt trap, while debt for capital expenditure and asset creation is beneficial for economic growth. Subramanian also explains why countries should not blame the IMF for the tough measures required during bailouts, as these measures are a consequence of past economic mismanagement.