Indeed in his view this was the very logic of planning for industrialisaton 6

Indeed in his view this was the very logic of

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. Indeed, in his view this was the very logic of planning for industrialisaton. 6 Downloaded by Vicky Gupta ([email protected]) lOMoARcPSD|3929542
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a. Autonomy was at the core of the Nehruvian vision of economic development, not to menton of post-colonial India, and nothing would epitomise this more than a strong balance of payments positon. Accelerated growth of income. 23. So a rapid increase in the level of income was the objectve and this was to be brought about via greater investment in heavy industry. We have also seen that this was central to the plan for the transformaton of Indian agriculture. 24. But how was this to be resourced? 25. The planners were fully aware that the step-up in investment envisaged in the Second Five-Year Plan was very substantal. This is apparent from two elements of the plan to raise the level of income. a. First , no major foreign assistance was envisaged . i. Taking the Second Plan as a case, foreign assistance was put down at less than 5% of total public expenditure in the proposed plan budget [Planning Commission 1956] for 1956-57 to 1960-61 even as the investment rate was to be raised by over 50% from 7% to 11% of GDP. ii. Of course, what the actual achievement with respect to foreign savings was we shall have occasion to study later. b. The second point to note is that the envisaged contributon of the public enterprises (PSE savings) for naton building was signifcant , revealing the Indian state’s understanding of their role in the economy. i. The item “additonal taxes and loans and profts from state enterprises” along with the “contributon from the railways” together equalled “loans from the public” and were over twice what was to be taken as foreign assistance. ii. The central premise of public policy in the 1950s was that the public sector was expected to contribute resources to the larger project of natonal development . NEHRU’S SPEECHES 1. PB emphasizes the following points about Nehru’s involvement in the planning process and his (and his government’s) vision - c. Nehru was the chairman of the Planning Commission and was closely involved with the planning process. d. His speeches reveal that i. The idea of industrialisaton as a goal to raise incomes was adopted even before the Mahalanobis model that had undergirded the Second Plan was writen down. ii. Further, they conveys the full recogniton among the planners of the importance of agricultural growth to the industrialisaton project. e. Two sets of speeches made almost at the end of Nehru’s tenure as prime minister, indeed close to the end of his life – i. contain a clear understanding of the inter-temporal distributon of gains that was central to the economic strategy that was being pursued. ii. It also refects a certain understanding of the uniqueness of India, not in a civilizatonal sense but in the sense of the challenges it faces given its economic backwardness and its democratc polity.
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