From 50 Years Ago: Setting the Sights- For the Third Plan.

We are now almost over the hump, so far as t he Second Plan is concer ned. Suf ficient foreign assistance is now in sight to implement at least the core of the Plan. The backlog of import licences has been largely worked off and the drastic import cuts are becoming increasingly effective. Thanks largely to a favourable monsoon, agricultural production has reached a new high this year and agricult ural exports have started looking up, in spite of a persistent slump in world commodity trade. In contrast with large deficits every week about this time a year ago, Reserve Bank’s foreign balances are now steady, if not actually improving. The new iron and steel mills are shortly due to go into production. The money market is easy and Government loans are being over subscribed. Some of the Central and State taxes have also produced larger yields than in the previous years. The pendulum, therefore, has been swinging from the extreme pessimism of last year towards optimism this year. The situation is somewhat reminiscent of 1954-55 when the Second Plan was being formulated.

Those who are still worrying about the problems faced in 1957-58 are pressing for a “safe” or modest plan or even for a holiday from planning. Others who had predicted that the crisis of 1957-58 would not be so intractable or persistent as to warrant a drastic change of policy are now feeling more confident and are pressing for a “bold” plan. Those who favour laissez faire and pin their faith on private enterprise want less of taxation, less public expenditure and hence a modest plan. Others, who believe that the real choice before the country is not between a “bold” plan and a “modest” plan, but between “bold effort” now for breaking the “development barrier” and a “spirally increasing population and poverty” in future, are pressing for more machine-making plants, more fertilizer and chemical factories, and more steel plants during the Third Plan.