India - Economic situation and prospects

Report No. 2008-IN Economic Situation and Prospects of India FILE COPY April 17, 1978 South Asia Region FOR OFFICIAL USE ONLY Document of the World Bank This document has a restricted distribution and may be used by recipients only in the performance of their official duties. Its contents may not otherwise be disclosed without World Bank authorization.  CURRENCY AND OTHER EQUIVALENTS Currency Prior to June 6, 1966 US$1.00 = Rs 4.7619 Rs 1.00 = US$0.21 From June 6, 1966 to US$1.00 = Rs 7.50 mid-December 1971 Rs 1.00 = US$0.13333 Mid-December 1971 to US$1.00 = Rs 7.27927 end-June 1972 Rs 1.00 = US$0.1374 After end-June 1972 : floating rate Spot rate (January 31, : US$1.00 = Rs 8.063 1978) Rs 1.00 = US$0.124 Rupee trade figures have been converted into dollars by using the prevailing exchange rate up to 1970/71. For subsequent years the following average IMF trade conver- sion factors/market rates have been used (rupees per US dollar): 1971/72 : 7.444 1972/73 7.706 1973/74 7.791 1974/75 7.976 1975/76 : 8.653 1976/77 8.939 For 1977/78, the average market rate for the first nine months was Rs 8.704. For the year as a whole the rate of Rs 8.6 has been used. Weights Unless otherwise specified all weight measures are metric. Years The Indian fiscal year runs from April 1 through March 31. Abbreviations Used n.a. = not available n.s. = not significant (blank) not applicable - - nil  International Bank for Reconstruction and Development FOR OFFICIAL USE ONLY SecM78-356 FROM: Vice President and Secretary April 20, 1978 INDIA - ECONOMIC REPORT 1. There is attached for information a report entitled "Economic Situation and Prospects of India" (2008-IN) dated April 17, 1978. 2. This report has been made available to the Consortium for India (IND 78-2). Distribution: Executive Directors and Alternates *President *Senior Vice President, Operations *President's Council *Vice Presidents, IFC Directors and Department Heads, Bank and IFC *without attachment This document has a restricted distribution and may be used by recipients only in the performance of their official duties. Its contents may not otherwise be disclosed without World Bank authorization.   FOR OFFICIAL USE ONLY This report was prepared in New Delhi by members of the World Bank Resident Mission in India and of the India Division at World Bank headquarters under the guidance of J. [raske (Resident Mission Chief) and 0. Yenal (Principal Economist). Those contributing from the Resident Mission were M. Baird, J. Harrison, S. Sengupta and A. Van Nimmen. Those from the India Division were R. Grawe and J. Wall. Y. Satyanarayana assisted in the statistical work. The report drew upon background papers prepared by S. Reutlinger (World Bank) on Foodgrain Stocking Policy; G. Desai (Consultant) on Fertilizer Consumption; J. Krishnamurty (Consultant) on the Labor Force and Unemployment; and The National Council of Applied Economic Research on the Industrial Situation. In view of the deadlines imposed by the date of the next Con- sortium meeting, the report had to be prepared before the issue of the new Five Year Plan. The Draft Five Year Plan for 1978-83 was discussed at the National Development Council on March 19 and 20, but has not yet been approved. This Draft has been briefly reviewed and commented upon in this Report. This document has a restricted distribution and may be used by recipients only in the performance of their omcial duties. Its contents may not otherwise be disclosed without World Bank authorization   ECONOMIC SITUATION AND PROSPECTS OF INDIA Table of Contents Page No. BASIC DATA MAP SUMMARY AND CONCLUSIONS ................................. i - vi PART I - THE OPPORTUNITY ................................ 1 Chapter 1. The New Situation ...................... 2 A. A Year of Uneven Progress: 1977/78 ....... 2 B. Changes in the Economic Scene: 1975-78 .. 3 Chapter 2. The Next Five Years ..... ............... 11 A. The Draft Five Year Plan ..... ............. 11 B. Resource Prospects ..... ................... 13 C. Policy Implications ..... .................. 18 D. Development Priorities ..... ............... 22 PART II - PROSPECTS AND PROBLEMS ........................ 26 Chapter 3. Agriculture ............................ 27 A. Crop Pattern .............................. 28 B. Non-crop Agricultural Activities .... ...... 32 C. Irrigation ................................ 33 D. Fertilizer and Seeds ..... ................. 40 E. Extension ................................. 46 F. Foodgrain Stock Policy ..... ............... 52 Chapter 4. Industry ............................... 55 A. Structure ................................. 55 B. Industrial Investment and Finance .... ..... 59 C. Industrial Policy ......................... 66 Chapter 5. Employment ............................. 71 A. Dimensions ................................ 71 B. Prospects ................................ 76 ANNEX TO CHAPTER 2: Balance of Payments Projections .... ..... 83 ANNEX TO CHAPTER 5: Rural Employment Programs .... ........... 91 STATISTICAL APPENDIX (Including List of Tables)  List of Text Tables Page No. PART I 1.1 Sources of Foreign Exchange Supply .... ....... 5 1.2 The Use of Available Resources .... ........... 8 1.3 Sectoral Growth Pattern 1977/78-1982/83 ...... 11 1.4 Balance of Payments ...... .................... 15 PART II 2.1 Pattern of Land Use and Output Mix .... ....... 28 2.2 Rates of Growth of Foodgrain Area, Yield and Production .29 2.3 Rates of Growth of Area, Yield and Production of Oilseeds, Cotton and Sugarcane .31 2.4 India's Gross Cropped and Gross Irrigated Area .35 2.5 India: Irrigation Potential by Broad Categories .35 2.6 India's Plan Allocation on Major and Medium Irrigation During the Plan Period .... ...... 36 2.7 Fertilizer: Crop Price Ratios .... ........... 42 2.8 Projected Fertilizer Demand ..... ............. 45 2.9 Potential Yield Increase Expected from Extension .47 2.10 Effects of Inputs and Management on Yield in Farmers' Fields, Dryland Pilot Project Hyderabad, 1973/74 .48 2.11 Yields and Adoption Rates, Chambal (Rajasthan) Project Area .50 2.12 1975/76 Output, Value Added, Fixed Capital and Employment - by Sectors ..... ........... 57 2.13 Composition of Manufacturing Output .... ...... 58 2.14 Industrial Investments - Selected Indicators 60 2.15 Selected Investment Indicators .... ........... 61 2.16 Profitability Ratios and Tax Margins ......... 64 2.17 Employment-Unemployment ..... ................. 72 2.18 Incidence of Week-long Unemployment .... ...... 73 2.19 Grouping of Indian States by Level and Variability of Unemployment Rates (% of the Labor Force) by Daily Status, Rural Persons 1972/73 .75 2.20 Selected Components of Employment in the Small-Scale Sector ......... I . .......... 78 ANNEX TO CHAPTER 2 1 Merchandise Exports .83 2 Merchandise Imports ...... .................... 87  List of Text Tables (continued) Page No. ANNEX TO CHAPTER 5 1 Centrally Assisted Rural Employment Schemes ........... ......................... 91 2 Percentage Distribution of Expenditure on Drought Prone Areas Program 1970/71 to 1973/74 ............ ...................... 94 3 Progress of the Maharashtra Employment Guarantee Scheme ....... .................... 96 4. Distribution of EGS Expenditure by Type of Work ........ ....................... 97   INDIA - SOCIAL INDICATORS DATA SHEET LAND AREA (THOU KM2) ------------------------------------------------- --------------- INDIA REFERENCE COUNTRIES (1970) TOTAL 3280.5 MOST RECENT AGRIC. 1797.5 1960 1970 ESTIMATE INDONESIA PHILIPPINES BRAZIL** GNP PER CAPITA (USs) 60.0* 100.0* 15.O* 130.0* 230.0* 550.0* POPULATION AND VITAL STATISTICS POPULATION (MID-YR, MILLION) 434.9 547.6 620.4 17.6 36.9 92.8 POPULATION DENSITY PER SQUARE KM. 133.0 167.0 189.0 62.0 123.0 11.0 PER SQ. KM. AGRICULTURAL LAND 247.0 308.0 345.0 411.0 375.0 49.0 VITAL STATISTICS CRUDE BIRTH RATE (/THOU, AV) 43.2 41.0 37.0 45.9 44.2 38.4 CRUDE DEATH RATE (/THOU,AV) 23.9 19.0 17.0 20.6 13.2 9.9 INFANT MORTALITY RATE (/THOU) 139.0/a .. 130.0 . 81.0 110.0 LIFE EXPECTANCY AT BIRTH (YRS) 41.7 47.2 49.5 . 55.6 59.4 GROSS REPRODUCTION RATE 3.2 2.9 2.8 3.2 3.3 2.6 POPULATION GROWTH RATE (%) TOTAL 2.0 2.3 2.1 2.0 3.0 2.9 URBAN 2.5/b 3.2 3.1 3.7/a 4.0 5.o URBAN POPULATION (% OF-TOTAL) 17.9 19.8 20.6 17.5Lb 27.6 56.0 AGE STRUCTURE (PERCENT) 0 TO 14 YEARS 41.0 41.6 40.1 44.0 45.6 42.o 15 TO 64 YEARS 55.9 55.3 56.7 53.5 51.6 55.0 65 YEARS AND OVER 3.1 3.1 3.2 2.5 2.8 3.0 AGE DEPENDENCY RATIO 0 8 0.8 0.8 0.9 0.9 0.8 ECONOMIC DEPENDENCY RATIO 1:1/c 1.1/a * 5/ab .. 1.5 1.5 FAMILY PLANNING ACCEPTORS (CUMULATIVE, THOU) 71.0 14585.0 37658.0 259.3 320.0 250.0 USERS (% OF MARRIED WOMEN) .. .. 18.7 2.0 1.6 EMPLOYMENT tOTAL LABOR FORCE (THOUSAND) 175000.0 218000.0 254600.0/b 12400.0 29400.0 LABOR FORCE IN AGRICULTURE (%) 71.0 69.0 69. 7'6 .. ss.o/a 40 4 UNEMPLOYED (% OF LABOR FORCE) 4.8 /d 4.4 /b 4.4 7 C1, *- 7.6 7.5 INCOME DISTRIBUTION % OF PRIVATE INCOME RECOD BY- HIGHEST 5% OF HOUSEHOLDS 26.7 25.0 . .. .. .. 35.0/a HIGHEST 20% OF HOUSEHOLDS 51.7 53. .. . 54.0 62.o7ia LOWEST 20% OF HOUSEHOLDS 4.1 4 .7 .. 3.6 3 olT LOWEST 40% OF HOUSEHOLDS 13.6 13.1 3 - 11.7 Ool DISTRIBUTION OF LAND OWNERSHIP _______________________ ______ % OWNED BY TOP 10% OF OWNERS .. .. .. .. . 45.0 % OWNED BY SMALLEST 10% OWNERS .. .i . ., .. 1,5 HEALTH AND NUTRITION POPULATION PER PHYSICIAN 5840 0.Le 4B90.0 4220.0 26370.0 . 1910.0 POPULATION PER NURSING PERSON 5310.0J 5o220.0/d 3680, OL 7630.0/c . 3220.0 POPULATION PER HOSPITAL BED 2590.0n 1610.0 ,, 1640.0-- 850.0 260.0 PER CAPITA SUPPLY OF - CALORIES (% OF REQUIREMENTS) 95.0 92.0 89.0 91.0 93.0 109.0 PROTEIN (GRAMS PER DAY) 55.0 53.0 48.0 43.0 45.0 64.0 -OF WHICH ANIMAL AND PULSE 19.0 ! 16.0 12.6 14.0 22.0 39.0 DEATH RATE (/THOU) AGES 1-4 44.0 .. . . 6.6 EDUCATION ADJUSTED ENROLLMENT RATIO 41.0 63.0 65.0 75.0 113 87.0 PRIMARY SCHOOL 4. 30 6. 50 130 8. SECONDARY SCHOOL 23.0 30.0 29.0 15.0 49.0 68.0 YEARS OF SCHOOLING PROVIDED (FIRST AND SECOND LEVEL) 12.0 12.0 11.0 12.0 10.0 11.0 VOCATIONAL ENROLLMENT (% OF SECONDARY) 8.0 .. , 29.0 6.0 /b 17.0 ADULT LITERACY RATE (%) 24.0 33.0 36.O/e 59.0 . 64.o HOUSING PERSONS PER ROOM (URBAN) 2.6 2.8 . . . 2.1 1.0 OCCUPIED DWELLINGS WITHOUT PIPED WATER (%) ,. .. ,. ,, 76.0 73.0 /C ACCESS TO ELECTRICITY (% OF ALL DWELLINGS) .. . . 23.0 48.0 RURAL DWELLINGS CONNECTED TO ELECTRICITY (X) .. .. .. .. 7.0 8.0 CONSUMPTION RADIO RECEIVERS (PER THOU POP) 5.0 21.0 25.0 114.0 39.0 60.0 PASSENGER CARS (PER THOU POP) 0.7 1.0 1.0 2.0 8.0 25.0 ELECTRICITY (KWH/YR PER CAP) 46.0 114.0 143.0 20.0 235.0 491.0 NEWSPRINT (KG/YR PER CAP) 0.2 0.3 0.3 0.3 2.0 2.7 SEE NOTES AND DEFINITIONS ON REVERSE  NOTES Unless otherwies noted, data for 1960 refer to any year between 1959 and 1961, for 1970 between 1969 and 1971, and for Most Recent Estimate between 1973 end 1976. GNClP per capita data are based on the World Bank Atlas methodology (1974-76 baais). us Brazil has beenl selected as an objective country becsaue of its size and comparable Problemsa of regional Inequality. IDA 1960 Ia 1951-61 average; /b 1951-60; /c Ratio of populatiom under 15 and 65 and over to labor force age 15 and over; /d Estimated by Natioa"l ta,pia Survey, in terms of the average number~ of peron/weeks of unemployment as percentage of total person/weeka in the labor force; /e 1962; If& Registered, not all practicing in the country; _/& Including midwives; /b 1958; /I 1960-62. 1970 /a Ratio of population under 15 noud 65 and over.to total labor force age 15 and over; /b Estimated bly National Sample LaSurvey, in terms of the average number of person/weeks of unemployment as percentage of total person/weeks in the total labor force; /c 1967-68; /d Including midwives. MOST RECENT ESTIM4ATE: Ia Ratio of population under 15 and 65 and over to total labor force; /b 1977; /c Estimated by National SamPle Survey, In terms of the average number of person/weeks of unemployment as percentage of total person/weeks in the labor force; /d Including midwives; La Population 10 years and over. rNDONESIA 1970 la 1961-71; /b 1971; /c including midwives. PHILIPPINES 1970 /a As percentage of employment; /b Not including private vocational achools. BRAZIL 1970 Ia' Econmically active population; /b Hospital personnel; /c Inside only. R12, March 29, 1978 DUDqIrTIOIS OF SOCIA INDICATORS L_nd_Ar____th_______ Population per nursing paragon - Population divided by number of practicing Total- Total surface area comprising land area end inland waters, male and female graduate nurses, "trained" or "certified' nurses, and Axi.-most recent estimate of agricultural area used temporarily or parns- a-intiary personnel witb training or experience. neamtly for crops, Pastures, markst & kitchen gardens, or to lie fallow. Population Per hospital bed - Population divided by .,cmbr of hospital beds available in public end private general and specialized hospital And ONP pear capita CusS) - ONP par capita estimat-es t current marbat prices * rehabilitation centers; sec ludes nursing houe.asaed setablihaheets for calculated by same conversion method as World Bank Atlas (1973-75 basis); custodial end preventive ears. 1960; 1970 and 1975 data. Par capita supply of calories (% of requirements) - Computed from energy equivalent of not food supplies available in country par capita per day; Population end vital statistic, available supplies comprise domestic production, imports laes exports, and population (mid-year million) As of July first: if not available, -avrage changes in stock; net suPPlies exclude animal feed, seeds, quantities used of two end-year estimates; 11160, 1970 and 1975 data, in food prmossing and loseas in distribution; requirements were estimated by FAO based on physiological needs for normal activity and health cona id- pogulation density - per square be. - Nid,yar population per square kilometer srnug eivironimental temperature, body weights, age end sax distributions of (100 hecteres) of total ares, population, and allowing 101 for waste at household level. population dens ity - per square be of astric, laud - Computed as shove for Per capita supply of protein (strams Per day) - Protein content of per capita agricultural land only. net supply of food per day; mat supply of food is defined as above; require- mints f or all countries established by USDA Economic Research Services Vital statistics provide for a minimum allawane of 60 gram of total protein par day, and Crude birth rate per thousand. average - Annual lire birtha par thousand of 20 gr-am of animal and pulse protein, of which 10 grams should be animal mid-year Population; ten-year arithm.etic averages ending in 1960 and 1970, protein; these standards are lower than those of 75 grams of total protein and five-year average ending in 1975 for neat recent estimate. and 23 grams of animal protein as an average for the world, propesed by FAO Crude death rate Per tho4send. aeraste - Aonimal deaths per thousand of mid-year in the Third World Food Survey. _ population; ten-year arithmetic averages ending in 1960 and 1970 and five- Per capita protein supply from animal and pulse - Protein supply of food year average ending in 1975 for mos t recant estimate, derived from animals end pulses in grams per day. Infant mortality rate f/thou) - Annual deaths of infants under one year of age Death rate C/thou) ages 1-4 - Annual deaths par thousand in age group 1-4 per thousand live births. years, to children in this age gsmup; suggested as an indicator of Life expectancy at birth (vrs)- Average number of years of life remaining at malnutrition. birth; usually five-year averages ending in 1960, 1970 and 1975 for develop- ing countries. Education Gross reproduction rats - Average number of live daUghters a woman will bear Adiusted enrollment rattio -Primapr:chool - Enrollment of all ages as par- in her normal reproductive period if she experiences present age-specific centage of primary schoo-ag poplatio; includes children aged 6-Il years fertility rates; usually five-year averages ending in 1960, 1970 and 1975 but adjusted for different lengths of primary education; for countries with for developing countries, universal education, enrollment may excead 1001 since aome pupils are below Popula1tiongrowth rate fl.) - total - compound annual growth rates of mid-year or above the official school age. poultin fo 1950-60, 1960-70 and 1970-75. Adjusted anrollment ratio - ascondary school - Computed as above; secondary Population growth rate Cl) - urban - Computed like growth rate of total aducation requires at leasst four years of approved primary ma truction; population; different d.finitioms of urban area ny affect comparability of provides general, vocatioaul or teacher training instruations for pupils data among couatries. of 12 to 17 years of age; correspondence courses-are geosrally axeluded. urban ,,,oopletion f'I of total) - Ratio of urban to total population; different Years of schooling provided (first end second levels) - Total years of de initon of urban areas may affect comparability of data among countrias. schooling; at secondary level, vocational Instruction may be partially or completaly excluded. Ate structure (percent) - Children (0-14 years), working-age (15-64 yeas"), Vocational enrollment fT of secondary) - vocationel institu,tione Include and retired (65 years and over) as percentages of mid-ye.r population. technical, indus trial or other progress which operate independently or as Age dependency ratio - Ratio of population under 15 and 65 and over to those deparmemnts of secondary institutions. of ages 15 through 64. Adult literacy rate flI - Literate adults (abla to reed and write) as per- Economic dependency ratio - Ratio of population under 15 and 65 and over to centage of total adult population aged 15 years end ovr. the labor forcec in age group of 15-64 years. Family planning - acceptors (cumulative, thou) - Cumulative number of acceptors HousIng of birth-control devices under auspices of national family plamoing program Persons per room (urban) - Average nuber of Persona per room in occupied since inception. conventional dwellings in urbat areas; dwellings exclude non-permanent Family pleannint - users C1 of married women) - Percentages of maried women of structures end unoccupied parts.- child-bearing age (15-44 years) who use birth-control devices to all married Occupied dwellings without piped water (Xl - occupied conventional dwellings women in sam age group. is urben end rural areas without inside or outside piped water facilities as pecntage of all ocpied dwellings. imployment Accessc toelctricity (7. of all dwellings) - Conventional dwellings with Total labor force (thousand) - Econmically active persons, including armed electricity in Iliving quarters as percent of total dwellings in urban end forces end unemployed but excluding housewives, students, etc.; definitions rural areas. in various countries are not comparable. Rural dwellings connected to electricity Cl)-Cmputed as above for rural Labor force in aericultume (l) - Agricultural labor force (in farming, fareatry, dwellings only. hunting and fishing) as percentage of total labor force. Unamploved ft of labor force) - Unemployed are usually defined as parsons who Consumption are able end willing to take a job, out of a job on a given day, remainad out Radio receivers (per thou pop) - All types of receivers for radio broadcasts of a Job, and seeking work for a specified minimum period not exceeding ame to general public per thousand of population; excludes unlicensed receivers week; may not be comparable between countries due to different definitions in countries end in Years when registration of radio sets was in effect; of unePloyed and source of data, e.g., employment office statistics, sample data for recent years may not be comparable since moat countries abolished surveys, compulsory unemployment insurance, licensing. Passenger cars (par thou Pop) - Pass enger care comprise motor care seating Income distribution - Percentage of private income~ (both in cash end kind) less than eight persona; excudes ambulances, hearses end military received by richest 51, richest 201, poorest 201, end poovrest 401 of house- vehicles. holds. Electricity (kwh/crr per cap) - Acnusl consumption of industrial, comsercial, public and private electricity in kilowatt hours per capita, generally Diatribution of land ownership - Percentages of land owned by wealthiest 101 based on production data, without allowance f or lossee in grida but allo- and poorest 107. of lend owners. fag for Imports and exports of electricity. Newsprint (ks/yr per cap) - Per capita annual consumption in kilograms Health end Nutrition estimated from domestic production plus nat imprts of newsprint. Population per physician - Population divided by number of practicing physicians qualified from a medical school at university level.  ECONOIUIC DEVSLOP1 DATA CNP PER CAPITA IN 1976 ' US$ 1SO GROSS NATIONAL PRODCT I;l 1976/77 f ANNUAL RATS OF GROWTH (96. oopnant irtces -9 ust B1n. 96 1960/61-1964/65 1965/66.1969/70 1970/71-1975/76 GNP at Market Prioes 86.04 100.0 3-9 5.8 2.9 Gross Domestic Investment 16.62 19.3 Gross National Saving 18.18 21.1 Current Acoount Balanoe 1.56 1.8 Resource Gap 0.95 1.1 OUTPUT. LABOR FORCE AlND PRODUCTI"Y IN 1971 :U de6d_(at faotor ooet) orooeV A, Per IIOrk US 31n. 16 Mi~~~~~~~"cl s C k Agriculture 24.5 46.6 130.0 72.1 188 64 Industry 11.8 22.3 20.2 11.2 582 199 Services 16. MA2 -Q 6 19 Total/average 52.6 100.0 180.4 100.0 292 100 GOVEPIORT FINANCE General Govearnent a 1976/77 1976/77 1974/751 6/77 i9976/77 1976/771 974 75-17[ Current Receipts 147.46 19.1 17.9 83.76 10.9 10.4 Current Expenditures 140.1 16.2 iLl tA _2l.6 Currant Surplus/Deficit 7.28 0.9 1.7 - 0.47 _ 0.8 Capitea Expenditures j/ 59-05 7.6 7.1 40.59 5.2 5.0 Extersl Assistance (not) 11.21 1.5 1.7 11.21 1.5 1.7 MONtJ. '='lT AND PRIOE5 1970/71 1t97227 1 97L/4 1974/75 t 9S/7 1976/n S tept .r 1976 Si toS 1977 (Billion as outstanding at end or, pePriod)T honey a Quasi mone 105.7 1U2.2 169.0 186.9 215.0 262.6 238.2 264.8 Bank Credit to Publio Sector(net) 56.9 82.5 92.9 102.6 109.1 117.3 112.7 150.7 Bank Credit to Private Sector 56.7 76.0 90.1 109.5 127.5 161.0 144.0 170.0 (Percentage or Index Number) JAXjtl0 1977 JA t978 Moner and Quai Money as % of GDP 24.5 27.3 26.4 25.5 27.6 31.3 Wholesale Priae Ind5i (1970/71 * 100) 100.0 116.2 139.7 174.9 173.0 176.6 178.8 185.3 Annual percentage dunes ins Wholesale Price Index 7.7 10.0 20.2 25.2 -1.1 2.1 7.5 2.5 Bank Credit to Publio Sector (net) 8.6 19.6 12.6 10.4 6.3 7.5 4 7 l/ * I8/ Bank Credit to Private Sector 17.3 18.0 18-5 21.5 16-4 26.3 24.9 Al/ 11.9 1/ St The per capita GNP estimate in at market prioes, calulated IV the conversion technique used in the World Atlas. All other ocnversione to dollar. in this table are at the average exchange rate prevailing during the period covered. / Quick Estimates. 3/ Computed from trend line of CGP at factor cost series, including one observation before firet year and one observation aStar last yer of listed period. / Trewfere between Center *nd States have be n etted out. A loans nd advanoes to thbird parties have ben netted oat. t/ Net bank credit to Government Sector. B/ Rank credit to Comaera Sector.  BALANCE OF PAYMENTS 1974/75 197fL76 )6LI 1977/78 IfCR3ISE ECPORTS (AVEAE1 / (US$ Million IIERCRIiNDISE EPORTS (AVERACE 174/7S0-31976/77 Exports of Goods 4,174 4,665 5,760 6,400 Engineering Goods 515 11 Ioports of Goods -5,665 -6,084 -5,950 -6,600 Sugar 379 8 Trade Ralenoe -1,491 -1,419 - 190 200 Tea 296 6 BkS (net) 215 310 405 500 Jute Manufactures 294 6 Leather and Leather Resource Gap -1,278 -1,109 215 300 Products 268 5 ClothIng 257 5 Interest Payments (net) - 198 - 216 - 135 - 130 Iron Ore 238 5 Other Faotor Payments (net) - - - Cotton Textiles 223 5 Net Transfers 2/ 257 470 730 1,000 Others 23596 4 Total 4866 100 Balance on Current Acoount -1,217 - 8ss 810 1,170 Official Aid EXTERNAL DEBT. MARCR 11. 1977 1/ Disbursements 1,761 2,341 1,953 1,840 UCt Billion Amortization -515 -531 -560 - 630 Outstanding and Disbursed 13.6 Transactions with DIF 522 242 -336 - 330 Undisbureed 3.2 All Other Items -589 -403 -292 23 Outstanding,including Undisbursed 16.8 Inoreeas in Reserves (_) 38 -794 -1,575 -2,073 DEBT SERVICE RATIO FOR 1976/77 14.4 peroent I/V Gross Reserves (end year) 1,378 2,172 3,747 5,820 Net Reserves (end year) it/ 758 1 ,365 3,276 5,670 IBRD/tDA LENING, December 11. 1977 (lSt Iln.) Fuel and Related Materials IBRD IDA Imports 1,451 1,417 1,580 1,800 Outstanding and Disbursed 489.0 3,560-5 of ehio- Petroleum 1,451 1,417 1 580 1 800 Undiebursed 674.9 1,257.0 Outstanding, including Exports 26 43 37 n.a. Undisbureed 1,163.9 4,817.5 of which, Petroleum 17 22 21 n.a. RATE OF EXCHANGE Prior to mid-Deeomber 1971 US$1.00 = Re 7.5 After end June 1972 * Floating Rate Rs 1.00 =USSO.133333 Spot Rate January 31, 1978 Mid-December 1971 to US$1.00 = Re 7.27927 approx. US$1.00 = Re 8.063 end June 1972 Rs 1.00 = US8O.137376 approx. Re 1.00 = JSSO.124 b/ Estimated. F] Figures given cover all investment income (net). Major payments are interest on foreign loans and charges paid to IM0, and major receipt is interest earned on foreign assets. 2/ Figures given include workers' remittances but exclude official grant assistance, whioh is included sithin official aid diabursemennte. / Excludes net use of IhP credit. / Anortization and interest payments on foreign loans as a percentage of merchandise exports.  IBRO 10483R2 90 ~~~~~~~~~~Ap, I 1977 AFGHANISTAN _ 0 /,>,,r