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

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Government Loans- Tinkering with a Captive Market

role for the users of research in the financing and control of research is the system, hardly used so far, of development contracts for the design, development and manufacture of new types of machinery and equipment. The absence of such a system is a major reason why unutilised capacity in sophisticated machine building plants like those of the Heavy Engineering Corporation, Bharat Heavy Electricals and Heavy Electricals, Bhopal, co-exists with substantial imports of the type of equipment which these plants are capable of manufacturing. Further, without a system of development contracts one or two suppliers of critical equipment may acquire monopolistic positions, as has happened in the field of nuclear power plants. In the absence of arrangements for meeting the costs of research, designing and development, manufacturers are reluctant to go into the manufacture or sophisticated equipment, especially when they have profitable soft options readily available.

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