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Salient.The Newspaper of Victoria University College. Vol. 19, No. 4. April 6, 1955

Moscow-Delhi Axis

Moscow-Delhi Axis

There are some interesting clauses in the agreement between the Government of India and the Government of the Soviet Union for setting up a modern integrated iron and steel plant. This will have an initial capacity of one million ingots to be rolled into about 750.000 tons of rolled products. The plant will be designed with a view to eventual expansion to the capacity of one million tons of rolled products.

One such clause Is that the plant and equipment to be supplied from USSR are to be paid for in twelve Instalments, the rate of interest on the amount outstanding each year being calculated at 2½ per cent. Payments will be made in Indian rupees to be paid into a special account opened for this purpose In the Reserve Bank of India. Amounts thus credited to this account may be utilised for the purchase of goods in India and are to be fully convertible into pounds sterling.

Thus, presumably, it will be possible for the Soviet Union to import from Great Britain goods now forbidden for strategic reasons, simply by making use of the India backdoor.

Interesting, too, is the clause which provides for training of a sufficient number of Indian technicians both in India and the USSR so that Indian personnel may man the plant to the maximum "extent possible from the beginning."

Steel production will not be the only, or even the chief, lesson that the Indian technicians are taught. Although there is electoral shadow-fighting between the Indian Congress Party and the Indian Communist Party, no body can be in doubt as to which of the two is performing major services for the Soviet Union. Mr. Nehru's so-called "neutralism" is perhaps a far bigger menace to the West at the present time than would be an avowedly Communist Government in New Delhi.