Nation in debt, in arrears initially (5)
I believe the answer is:
india
'nation' is the definition.
(India is an example)
'in debt in arrears initially' is the wordplay.
'initially' says to take the initial letters.
The first letters of 'debt in arrears' is 'dia'.
'in'+'dia'='INDIA'
(Other definitions for india that I've seen before include "Republic in south Asia" , "[TEST TEAM]" , "South Asian country" , "Subcontinent of Asia south of Himalayas" , "Nation, I (radio comms.)" .)