A debt trap, as described in Option 2, refers to a situation where a country has to constantly borrow more money to be able to pay the interest on their outstanding loans. It gets trapped in this vicious cycle of borrowing and interest payments, hence the term `debt trap`. This answer is correct.

As for Option 1, following conditionalities by the IMF does not necessarily mean a country is in a debt trap, it may just be a part of an assistance or adjustment program.

Option 3 suggests refusal of loans or aide by foreign creditors might indicate that the country is a credit risk; however, it does not specifically state a cycle of increasing debt.

Lastly, Option 4`s high interest charged by World Bank on new loans and outstanding loans might indeed lead to or aggravate a debt trap, but the high interest rate in itself does not define a debt trap. Thus, it is not the best answer.