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

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Floating Ceylon Rupee

Leaving Homework to Creditors HAS the utility of the Aid India Consortium been stopped from depreciating further? Against $ 900 million expected for 1967-68, commitments to date aggregate $415 million, inclusive of the Export-Import Bank credit promised to Air India. Hope is now being radiated from New Delhi that, between USA and IDA, almost the entire balance would be forthcoming, to raise commitments to $ 850 million and that a similar amount might be pledged for 1968-69 at the May 17 meeting of the Consortium. The element of hope and wish in this calculation is fairly large: both USA and IDA are themselves groping for aid funds and India has ceased to be an ideal borrower. Moreencouraging is the prospect of rescheduling of debt repayments, the quantum of which is large enough, more than S 500 million, to make a significant difference to the availability of free foreign exchange. (Rescheduling in 1967-68 amounted to barely $ 97 million, mostly on World Bank and UK account.) It is a tribute to the strength of the lingering propensity to seek tied aid that more publicity is being given to the likely amounts of fresh Consortium pledges than the expected relief to the economy from rescheduling, which is worth far more than its equivalent in tied aid.

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