Third World woes

Chandigarh, Wednesday, September 25, 1974

IN the reports of the Reserve Bank of India and the World Bank, hardly any silver lining is discernible. In different tones, they give sufficient hints that we are all heading for harder times. The only consolation may be that we are not alone in this drift towards economic disaster. Amidst the galloping inflation comes the threat of a recession. Henry Kissinger has already raised an alarm. He told the UN Assembly: “World economic strains threaten to engulf us all in a general depression.” This is especially depressing to the poor and developing countries, which are already in a bad way. The World Bank warns that most developing countries will stagnate or record very little growth between now and 1980. Stating how the year’s events have jeopardised the economic development of the poorest countries, the report says that developing nations, except those which export petroleum and minerals, will not be able to achieve the 6 per cent growth rate in GNP, the target set for the second development decade. For that matter, even “moderately acceptable” growth rates cannot be achieved without a substantial increase in the flow of external resources to them. But then who is to provide these resources? Those developing countries which have no oil resources of their own will need at least $2,600-million aid this year over and above the previous forecasts, if their economies are to grow at all. The World Bank is apparently counting on the goodwill of the international community. But any optimism in this regard has to be guarded. The developed nations have not gone much beyond paying lip service to the cause of the have-nots.