ISSN (Print) - 0012-9976 | ISSN (Online) - 2349-8846

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NEW DELHI-IMF s Eager Client

NEW DELHI IMF's Eager Client B M WHEN 23 economists meeting in Calcutta sonic lime ago warned that "large- scale borrowing from the IMF by some underdeveloped countries has simply meant a .surrender of their economic sovereignty" and stressed that "this is not a path we would like India to follow", it had not been an idle warning. The leakage of the exact terms and conditions on which India is negotiating for a loan of 5 billion SDRs from IMF and the Finance Minister's letter of intent to the IMF authorities has brought home this truth to those who till now had been gullible enough to believe that India might somehow manage to get the IMF loan on specially .soft terms or that the Indian government would resist the "pressure and blackmail" of the IMF. Equally relevant in this context, again, was the warning of the Calcutta meeting of economists that borrowing from the IMF would give the IMF power to impose its own style of "economic discipline'' on the government's economic policies and the management of the economy. This has been borne out by the detailed assurances and commitments that R Venkataraman's letter of intent contains. Specific targets for deficit financing by the government, for its borrowing from the banking system and for similar other monetary and fiscal operations have been agreed to for the satisfaction of the IMF.

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