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

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From 50 Years Ago: Crisis of Coordination

Editorial from Volume XIV, No 23, June 9, 1962.

After the foreign reserves held by the Reserve Bank dipped below the Rs 100 crore mark it is only to be expected that the foreign exchange situation should appear as a crisis. It is an absurdly low figure for reserves in all conscience for a country of India’s magnitude, and it definitely shows that our annual budgeting of foreign exchange has not been as close or as tight as it should be…

Whenever a Plan target fails disastrously, the explanation for it is to be sought in the interacting factors which must follow a certain fairly precise time sequence in order to arrive at the end point which is that target. Foreign exchange balance is the resultant of all the targets taken together. No projects have been taken up without adequate provision for the foreign exchange, either committed or expected to arise from the Plan performance in the various sectors. Failure on this front is the end point of a chain reaction. The Planning Commission cannot coordinate, it does not even try. The Ministries go their own way, and collective Cabinet responsibility is only polite constitutional fiction; so why speak of coordination by the Cabinet? Yet it must be pretty obvious that all the problems of Plan execution can be summed up in one word “coordination”. If at last the Government has come to recognise it to be of sufficient importance to appoint a Cabinet Minister of the stature of T T Krishnamachari exclusively for this task... Much good may come from it yet.

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