ABSTRACT
This chapter considers two major Asian countries, both of which share the distinction of being at the lower end of the economic development ladder, but that both have recently taken decisive steps in the direction of better realising their respective potential. India and Vietnam also have other things in common, such as a strong and long held belief in the virtues of planning and the benefits of developing a strong producer goods sector. The experience with a colonial regime of discriminating protection and imperial preferences’, Rothermund argues, ‘prompted India’s planners to adopt a policy of what may be called “indiscriminate” protection. India relied on domestic rather than on export led growth, which was praised as a marvellous economic remedy by those who were fascinated by the sudden emergence of the newly industrialised countries in East Asia. Indian fiscal policy was known for its conservatism, with strict treasury control and political dominance of the Congress.
