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The world''s 137 poorest nations owe a total of $2.6 trillion in international debt, and these countries on an average spend 25% of their national budget in repaying the debt, depleting the countries'' resources to invest in infrastructure, education, healthcare and other social programmes. Fearing that debt repayment will rob these countries of their future, a number of policy makers and international activist groups called on the lenders to write off the debt of the poor countries. On the other hand, multilateral lenders like the International Monetary Fund (IMF) and the World Bank cited that debt cancellation was not beneficial for the financial health of the international creditors and it might hurt the poor countries more than helping them. Instead, the Heavily Indebted Poor Countries'' (HIPC) debt initiative was launched with the objective to cut the debt of 38 heavily indebted poor countries to sustainable levels. The case study provides an overview about the HIPC Initiative and encourages discussion on the effectiveness of the HIPC initiative and whether writing off the debt would enable economic development of the poor countries.