Economic Reform in an Uncertain World B Gopalakrishna Kumar Both supporters and critics of the liberalisation policies of the eigh ties agree thai these occurred against a background of large macro-economic imbalances: a huge foreign debt liability, a barely sustainable balance of payments situation and growing fiscal deficits Although the threat of a default on loan obligations has now receded, short-term breathing space is still being provided by disbursements from the IMF on fulfilling various performance criteria laid down by the Fund.