14 SOCIAL SCIENTIM automatically make for viability and growth of these units. In the past the Government had grossly neglected the task of absorbing the technology imported into the public sector and had hamstrung the public sector in its bargaining with foreign suppliers of technology. What could have been a potential source of strength for the public sector, viz., the existence of a large number of units capable of throwing up new ideas and implementing R & D projects to adapt borrowed technology an4 invent methods, had been turned into a weakness through the deliberate fragmentation of efforts and authority.7 This mistake is to be compounded several fold now in the name of efficiency or, sometimes, in a burst of barefaced confession of failure, expediency. We have examined only a few instances of the effect of technology import, and of the liberalization of industrial and import policies. But the illustrations chosen are typical. They indicate that the areas where the import of technology is really required in the economy have not been carefully thought out. Nor have the implications of the measures adopted been examined carefully. What is happening is essentially ad hoc, based on the recommendations of certain pressure groups. The policy changes appear to be totally unconnected with the plan programme. The present combination of policies is likely, in fact, to lead to de-industrialization in that many existing industries are likely to be wiped out, not because of any inherent long term comparative disadvantage but because of unplanned and ad hoc changes in import policy, while any new activity likely to arise as a result of the policy would not create enough employment even to offset the unemployment directly caused by the closure of industries through unplanned imports. The process of technology import, the way it is being permitted, is also likely to lead to increased "concentration', by the weeding out of small pro-ducers,and an accentuation of the inequality in the distribution of income. The process set in motion is not likely to lead to the growth of over-all industrial output and employment, and not likely to improve exports. We would like to repeat the warnings given by many economists about the danger of India walking into a debt trap which is likely to follow if the present policies continue to be pursued. Such a possibility will mean not only the loss of economic sovereignty by the Indian Government; it is likely to lead to a long-term crisis because of the ever-present threat of capital flight. In Latin American countries, such as Mexico and Argentina, the huge official debt is further swollen by very large flights of private capital (amounting in the case of Mexico to more than U.S. $32.7 billion over the period 1974-83).8 Nonresident Indians and many resident Indians have already taken a considerable volume of capital out of India. There is a real danger that if India walks into a massive international debt, her Government will be blac)unailed not only byTNC banks, other TNCs, but also by her new found NRI investors as also wealthy citizens who know of ways to take their capital out of the country. This threat can, in the event we walk into the debt-trap, compromise our very ability to adopt a policy of self reliance and an independent foreign policy.