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Kerala's economic policy

A. Jacob Sahayam, e-mail

Though the previous LDF government in Kerala was acclaimed for its decentralised planning and implementation, its `closed-door' economic policy landed it in a financial crisis and consequent defeat in the Assembly election.

In this context, the new UDF government's policy ``to lure private funds in key sectors'' (Business Line, June 30) to resolve the development crisis in the State may be welcome. At the same time, they will have to create an atmosphere of confidence in th e minds of domestic and foreign investors.

And before raising taxes and increasing charges such as electricity, they would have to prepare the people to accept these changes.

Moreover, loss-making PSUs are white elephants. Previous attempts to restructure and pour in money have not had much impact on many of them. So, for continuously loss-making PSUs some innovative method of handing them over to Employees Cooperatives shoul d be introduced.

As pointed out in the editorial, `Stretching Problems' (Business Line, June 30), restrictions on imports and tariff protection cannot become a permanent feature.

For tiding over the temporary glut, the State should take action on the use of natural rubber in the construction of roads inside and outside the State. More attention should be paid to the utilisation of by-products and developing rubber-based industrie s.