Prospects for Indian Development

Prospects for Indian Development

Prospects for Indian Development

Prospects for Indian Development

Excerpt

As this is being written, announcement is made of the fact that the United States has joined with five other nations -- West Germany, Britain, Japan, Canada, and France -- and with the International Bank in an agreement to extend to India loans and grants of at least $2 1/4 billion for the first two years of India's third five year plan, initiated on April 1, 1961. In addition, the United States had previously undertaken to assist the third plan through the provision of some $1.3 billion in surplus agricultural commodities. The new announcement is impressive from several points of view. First, the level of aid is of a comparable order of magnitude to the assistance given to some of the large European nations under the Marshall Plan. This contrasts with the position taken many times by these donor nations over the past decade to the effect that aid for the underdeveloped lands is appropriately smaller and different from the reconstruction aid for the devastated economies of Western Europe in the late forties. Furthermore, not only is a commitment made for two years but also the Consortium of Governments and Institutions (the official name of what is popularly known as the 'Aid-to-India Club') is a going concern; India is reasonably assured of the continuation of foreign loans and grants over the period of the plan. Such a commitment also contrasts with the uncertainty confronting the new foreign aid proposals of the Kennedy administration on account of the attitude of the United States Congress toward long-term aid commitments as a tool of executive policy. Finally, assistance comes both from the United States and from a consortium of nations whose contributing membership is expected to expand in the near future, perhaps by the addition of Scandinavian countries.

Here it is sufficient simply to note these factors, for they make unmistakably clear the importance which the heads of the democratic nations of the world attach to the success of India's development effort. As never before in the postwar period, in the spring of 1961 clear evidence is required that the long-static economy of a traditionbound society in a newly emergent nation can make the transition to dynamic modernity within a framework of democratic institutions. India has a government which seeks to accelerate the pace of modernization through persuasion and consent, not through com-

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