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ECONOMIC AID POLITICAL WEEKLY Skylark 284 Frere Road Bombay 400 038
Grama Econweekly Editor Krishna Raj Associate Editor Rajani X Desai Assistant Editor M S Prabhakar Editorial Staff Colin da Souza. K Vijayakumar Manager J K Thakkar Painless Prescriptions THE Annual Report of the Reserve Bank notes "two major areas" in which the Indian economy made "significant gains" in 1976-77. First, the country's foreign exchange reserves today stand at their highest level; and, second, there is a large and growing stock of foodgrains with the government. The riot-terribly-original suggestion follows that "what is called for is an assimilation in the development strategy of arrangements for using the resources of food and foreign exchange, and thereby generating a continuing process of growth". The Report omits to mention how the reserves of food and foreign exchange are to be harnessed to produce continuing growth; The Central Government has recently offered foodgrains gratis from its stocks to state governments for food-for-work programmes, but there have been few takers. Similarly, working groups of officials have been cogitating on how to speed up the use of foreign exchange reserves, but successive liberalisation of import policy and controls has produced no marked effect on the level of imports. The Reserve Bank's Annual Report does proclaim with an air of profundity that the food and foreign exchange resources of the community have remained unutilised "due to structural and institutional rigidities". However, it neither attempts to identify these rigidities, nor does it say how they might be removed or reduced.