Question

Could anyone please explain why having hard-coded strings is so bad?
What issues should I expect if I hardcode strings?
Why having a separate string xml file solves those issues?

Creating new elements in strings.xml is such a time consuming activity.

Answer 1

When adding your strings to strings.xml, you can easily translate your whole app into other languages.

So in the folder values you would have strings.xml with this content:

<string name="hello">Hello</string>

In values-fr a strings.xml with this content:

<string name="hello">Bonjour</string>

This saves you a lot of work instead of doing this the hardcoded way: Android automatically selects the correct language based on user preferences, and you don’t have to worry about selecting and displaying this language.

Please also read Localization | Android Developers.