Hon. Sidney E. Smith (Secretary of Stale for External Affairs):
On August 28, 1958, Mr. Speaker, my colleague the Minister of Finance reported to the house on a special meeting that had been held in Washington under the auspices of the international bank to consider means of alleviating India's foreign exchange difficulties. The Minister of Finance stated at the time that in the light of that meeting it appeared that the most helpful thing Canada can do is to continue to provide India with the Canadian goods she may require in her development program.
In the intervening months there have been detailed discussions between Canadian and Indian officials as to the type of assistance that would be most effective in helping India carry forward her economic development program and which Canada was in the best position to provide. I am pleased to be able to inform the house today that as a result of these discussions it has been agreed that $17 million will be made available to India out of the Colombo plan appropriation for the fiscal year 1958-59 to enable the Indian government to purchase in Canada essential commodities and equipment which they have requested from us.
Of the $17 million, $1 million will be applied to the Canada-India reactor to enable the work on that project to go forward; $10.5 million will be devoted to the provision of industrial raw materials including aluminum, copper and nickel, which are urgently needed by India in various phases of her development program and which will help sustain adequate levels of industrial activity and employment; $2.5 million will be provided in the form of railway sleepers-which I interpret as railway ties-to assist in the expansion and improvement of railway facilities in India; $2.5 million will be made available in the form of fertilizers which are required in connection with India's program to increase her food production; $120,000 will be devoted to the purchase of another three Cobalt beam therapy units for use in Indian hospitals. Discussions covering allocation of the balance of the funds
being made available to India in the current fiscal year are still in progress.
In all cases where Canadian aid is taking the form of commodities, the Indian government has agreed to establish local counterpart funds equivalent to the amount of the Canadian grant. These counterpart funds, as in the past, will be used to cover the local costs of economic development projects agreed upon by our two governments.
The house will be aware, Mr. Speaker, that over the past 15 months Canada was also able to assist India in meeting her requirements of food grains by making available a total of $48 million in the form of grants and loans for the purchase of Canadian wheat. Of this amount $7 million has been provided under the Colombo plan and $41 million over and above the assistance available to India under the Colombo plan.
Subtopic: COLOMBO PLAN
Sub-subtopic: STATEMENT ON AID TO INDIA