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

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Sugar Crisis Who Bears the Burden

reduction in interest payments is limited owing to the fact that there is continuous recourse to bank credit. This would have implications in terms of the effectiveness of a restrictive stance of monetary policy in the context of the need to contain inflationary pressures. Apart from these, the allo cations of expenditure for education and medical health could be subjected to scrutiny. Besides, two areas required closer examination. First, the role of subsidies particularly those relating to food and fertilisers, need a fresh look so as to ensure optimum use of available resources. Secondly, the transfer of funds to non-departmental commercial undertakings, both financial as well as non-financial and to States, need a careful reassessment. It would not appear to be a prudent course to use exchange rate variation for the purpose of reducing the rupee expenditure on imports.

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