Vol. 81, No. 3

Shoichi WATANABE, The multi-polar strategy of development aid of the western countries and the transformation of the international order in Asia

After WW II, Great Britain strove to support the new nations in South and Southeast Asia through the Colombo Plan, while also strengthening ties with its former colonies through the Commonwealth System. Meanwhile the newly independent Asian countries needed both capital and technical aid to implement the five-year plans which were the core of national economic strategies.
By the late 1950s, the Southeast Asian countries were the main beneficiaries of the Colombo Plan while the Aid India Consortium was established to meet Indian needs. The World Bank group, the United States, West Germany, Netherlands, Italy, Japan, USSR and other communist countries successively provided aid to development projects in the Asian countries. As a result, the countries of South and Southeast Asia were not only drawn into the vortex of competition among international political rivals to win allies through development aid, but actively tried to utilize negotiations over aid to promote their own projects. Thus a pattern of strategic cooperative relations between donors and recipients appeared in Asia in the 1960s.
Our panel explored this complex system of competition and cooperation in international development aids in India, clarifying the relations of the Asian donors and recipients in the reconstruction of a new international order in Asia.

Shoichi WATANABE, British aid policy toward India in the 1960s in relation to the Aid India Consortium

The Government of India launched its First Five Year Plan in 1951 through the Colombo Plan. However, by 1957, the sterling reserves of India, which played a central financial role in the Colombo Plan, had sharply declined. The World Bank, working with Great Britain and other donor countries, established a new aid scheme known as the Aid India Consortium. This paper explores British aid policy toward India in relation to the Aid India Consortium during 1960s. British aid to India used the export credits guarantee system after 1958. While this system had originally provided guarantees to British firms exporting goods to India, after 1957 it was given the additional power to extend loans. The British extended many project loans to India through this system, and also steadily increased non-project loans. In the late 1960s when the Government of India was faced with an emergency debt repayment, the British persuaded the World Bank to join other donor countries in a debt relief plan. The British established a new “Kipping Loan” scheme, named after the Director General of the Federation of British Industries, as well as continuing to offer loans through other schemes, in an effort to maintain profits from the Indian export trade.

Shigeru AKITA, PL 480 and US food aid to India in the 1960s

In the middle of the 1960s, India was faced with a series of political-economic crises, including the death of two Prime Ministers, Jawaharlal Nehru and Lai Bahadur Shastri, the stagnation of industrial development and the food crisis of 1965-67. This article analyzes the economic diplomacy of the Indian Government in the 1960s, paying special attention to the food crisis and its aftermath, which can be seen as the beginning of the “Green Revolution”. My analysis focuses on economic aid to India by the US, which was the largest donor country through the normal loans of DLF (The Development Loan Fund) and AID (The Agency for International Development). However, donations authorized under PL 480 (The Public Law 480), a program that supplied surplus food (wheat) aid and was managed by the Ministry of Agriculture, superseded the normal US loans and India received the largest share of aid under PL 480. The total reached 4.8 billion US dollars (51 million-tons of wheat and 8 million of other grains) by 1971. This huge US food-aid substantially contributed to resolving the food crisis, as a result of the Indian Government strong initiatives in collaboration with the World Bank. These measures led to the beginning of the “Green Revolution” in India from the late 1960s.

Katsuhiko YOKOI, The Indian military-industrial-research complex in the 1960s: the role of international aid during the Cold War era

Since the beginning of the planned economy, India made substantial investment in R&D in different fields with the goal of establishing indigenous industrial production as a base for greater self-reliance. Defense related industries were a major target of such investment. Following the 1962 war with China, a real push was made to strengthen domestic weapon production. A Department of Defense Production was established in 1962 to supervise the creation of an indigenous production base which was to be self-reliant and self-sufficient. A key element of this strategy was the strengthening of training of higher level technical personnel in a variety of fields. This paper analyses the significant role that foreign countries including the UK, US and USSR played in the development of the Indian military-industrial-research complex in 1960s. By focusing on the Indian Institutes of Technology (Kharagpur 1951, Bombay 1958, Madras 1959, Kanpur 1960, Delhi 1963), Hindustan Aeronautics Limited (Bangalore 1940/1964) and Bharat Heavy Electricals Limited (New Delhi 1964), I demonstrate that the industrial and military development in post-independence India could not be fostered without multinational aid which ensured international independence for India.

Ryo IZAWA, On the establishment and impact of relief for double income tax in the UK’s Finance Act of 1920

In Article 27 of the Finance Act of 1920, the UK government established a foreign tax credit relief to deal with the problem of double taxation on income (double income tax), a situation which had been aggravated during WWI. The double income tax relief provided foreign tax credit relief only within the British Empire and limited it to a maximum half credit.
This study examines the factors that shaped the terms of the double income tax relief. The main factors contributing to the differentiation in tax relief were the demand of the Inland Revenue, a department of the UK government, to minimize the reduction in revenue. The policy was supported by various private individuals and associations. In making their views known, representatives of business groups were restrained by their earlier campaigns for double income tax relief which had argued that relief should be limited to those within the British Empire. The study also shows that the Finance Act of 1920 impacted inter-war investment patterns. The act was a factor in the concentration of British investment within the British Empire, impacting a wide-range of industries.

Hiroaki MOROTA, The role of region-specific currencies in the Chinese currency reform, 1910-1930

In the early 20th century, two governmental banks, the Bank of China and the Bank of Communication, issued region-specific banknotes whose circulation was limited to the region printed on the face of the banknotes. The system was developed to deal with differences in the purity of silver in coins and fluctuating domestic exchange rates, and to prevent arbitrage between coins issued in different regions. The system was also designed to stabilize circulation of currency in regional markets. The currency reform of 1935 unified currencies issued throughout the nation, and should have abolished fluctuation in exchange rates between regions. However in the Tianjin region, following an agreement between the legal tender inspection administration and regional leaders in Tianjin, the two banks continued to issue region-specific bank notes. This measure was intended to reduce the burden on central authorities in meeting the regional demand for currency that would be widely accepted by the public, and to aid in central control of currency. Thus we find a paradoxical situation that arose in response to the vast size of the country and the difficulties of quickly meeting a rapidly increasing demand for currency: those in charge of currency unification cooperated with regional efforts that resulted in continuation of diversity.

Mayo SAKAI, Industrial relations in coal mining: a study of the Aso Coal Mine in the Chikuho region during its transitional phase

In the Japanese coal mining industry, firms originally used an indirect employment system called the “dormitory system.” Under this system, management of miners was delegated to a dormitory head. As of the 1890s, firms gradually transitioned to a direct employment system; however, the use of dormitory heads persisted in some way until the 1920s. This study uses “Miner Job Applications” and “Miner Attendance Records” from the Aso Fujidana Second Coal Mine in the 1900s to examine industrial relations. At the time, this coal mine's organization was in a transitional phase, operating under the dormitory system while partially adopting the direct employment system. Using the two employment datasets, we examine miners’ recruitment paths, working statuses and the organizational structures to which they belonged. This study shows that skilled miners tended to belong to the traditional dormitories, even though the heads of these dormitories tended not to monitor their miners very well. In contrast, miners in the directly controlled dormitory were monitored well. In addition, we find that the firm began to manage smaller units under dormitory heads.