India's Economic Push

...He told Parliament recently: “Some people, isolated from modern thought, are complaining that planning is taking away freedom from the people...

...It must also be remembered that the population is rising at the rate of more than five million a year, and that the country’s development must not only keep abreast but ahead of this unplanned growth...

...From April 1961 the third plan will require a foreign credit of $3 million per day for the entire five-year period...

...Communism as a political ideology is at a discount, but there are many people in this country who feel that democratic processes are too slow...

...Everything is governed by the exigencies of planning...

...All this was achieved with a total investment of $21.2 billion in India’s two Five Year Plans, to which the United States, in grants and loans, has contributed a little over a billion dollars...

...Nehru, who says an acquisitive society is immoral, has been assailed by a leading member of the Swatantra (Freedom) party, Minoo R. Masani, for leading the country toward Communism with his “confused ideas of Soviet-pattern five-year plans, collective farming and state socialism in industry...

...But his theories are subject to drastic modification when they come up against practical difficulties...

...On the other hand, that controls are irksome, that the Indian bureaucracy has swollen to monumental proportions, that for an individual Indian to start anything new requires superhuman effort cannot be denied...

...I hope the time will come when even the existing freedom to exploit will be taken away...

...Nehru, it is true, favors socialistic patterns, state trading in widening spheres and cooperative farming...

...But according to the Planning Commission of India, a sum of not less than $3.5 billion will have to be raised by way of additional taxation in the period 1961-66...

...The third plan, consequently, lays particular emphasis on machine-building industries, on light and heavy engineering and aids to stepped-up food and agricultural production, such as fertilizers...

...In his 70s, he is more and more impatient with argument, protest and demonstrations...

...India is thus at a crucial stage of its development as a free nation...

...That is why India’s biggest “leap forward” has been in industry, why private enterprise, despite controls and heavy taxation, has been able to over-fulfill its second plan goals, why the stock markets are booming and every major private industrial flotation is heavily over-subscribed...

...The total irrigated area has increased from 51.5 million to 70 million acres, power production has gone from 2.3 million to 5.8 million kilowatts, and an even bigger spurt is apparent in all types of industrial production...

...Indian planners, led by Prime Minister Jawaharlal Nehru, are aware (if they are not, a vociferous press and public is making them aware) that their latest blueprint will strain this nation’s capacity to the utmost...

...Since 1951 there has been a 42 per cent rise in national income, a 20 per cent increase in per capita income, a 120 per cent growth in industrial output and a 40 per cent increase in agricultural production...

...They point to the fact that the plan includes a fourth $400 million, million-ton steel plant when all the furnaces of two of the three new second-plan plants cannot be worked because of the coal shortage...

...enter an era of self-generating growth...

...Any slackening now, they say, would wipe out whatever progress already has been made...

...Finally, in a developing economy the dangers of inflation are ever-present...

...It does take away this freedom and we intend to take away this freedom increasingly...

...For India will be starting the new plan with its foreign exchange reserves down to an irreducible minimum and a yawning export-import gap...

...Certainly it takes away freedom to exploit others and make vast sums of money...

...While politicians and economists argue, the people are concerned with only one thing—prices...

...INDIA’S ECONOMIC PUSH Government’s efforts to launch era of self-generating growth with massive Third Five Year Plan will strain nation’s capacity to the utmost By Sharokh Sabavala BOMBAY AFTER NINE years of arduous and systematic planning, India has made sufficient economic progress to warrant the hope that it now is within measurable distance of its ultimate economic goal...

...Under Nehru the Planning Commission has even become a kind of a super-Government...

...Nehru recently told me that in those states where state trading had been tried, food prices were held down “better...

...India is a country where a microscopic minority—less than a million people out of a total population of 420 million—pays all the direct taxes...

...This minority, consequently, pays among the world’s highest taxes...

...The truth of the current Indian situation would seem to lie somewhere between Nehru’s somewhat exaggerated indignation against the exploiters and Masani’s charge that Indian planning techniques are leading to Communism and outright state control...

...Even if foreign assistance of this magnitude is forthcoming—and now many new African nations are rising to compete for U.S...

...Inflation is said to be due partly to deficit financing, partly to the even more normal pressures of a developing economy...

...Controls lead to attempts at evasion, which in turn lead to punitive actions and friction between the Government and the people...

...They ask why it is necessary to requisition $100 million for a nuclear power plant when even Britain is cutting back on its atomic power program...

...Indians know this through experience, and the knowledge makes it particularly difficult for them to envisage a future bristling with more controls, more self-denial ordinances, more austerity...

...The democrat in him increasingly is at variance with the man who wants to get things done in record time...

...Indians as a whole still remain to be convinced that democracy is the best and, in the long run, the quickest way out of the morass of poverty...

...and European assistance—there still remains the question of raising sufficient domestic capital...

...It ends its second plan this year with a heavy foreign exchange deficit, despite generous and continuing foreign assistance...

...These are impressive figures by any standard, and although some projects continue to fall short of their targets, a majority of Indians has been persuaded that economic-planning is necessary and worthwhile...

...In these last years of the second plan, the price line has not been held even on such daily commodities as food and clothing...

...India today is restive under the weight of its plans, even though it may consider them necessary, and a section of public opinion frequently points out now that as the burdens grow heavier the Indian way of life becomes more regimented...

...A planned economy necessarily is a controlled economy...

...Bolstered by this support, the Government now has projected a $21 billion Third Five Year Plan, as big in outlay as the two previous plans put together, in the hope that one more big push will see the country SHAROKH SABAVALA, NEW LEADER correspondent in India, also writes for the Christian Science Monitor...

...These arguments are generally accepted, but critics of Indian planning ask how the country can go forward on the unsafe premise that massive foreign aid will be forthcoming and that more domestic resources will be squeezed out of the already dry Indian husk...

...But he still remains by far the most powerful man in the country, deriving his power not from brute strength but from the voluntary support of his people...

...Nehru sometimes behaves as if he is one of them...

...In recent weeks, Nehru has been saying that “the Government is determined, through planning, increasingly to restrict ‘freedom to exploit’ and make vast sums of money...

...But they have not been held down sufficiently to please or placate public opinion and the result is a general labor restiveness, strikes, lockouts and a consequent holding-up of plan work...

...Controls also breed excessive bureaucracy and red tape...

...I ask: What freedom does it take away...

...According to the planners, the new development programs have to be formulated on an increasingly ambitious scale because the country cannot afford to slow the tempo of economic progress generated by the previous two plans...