How The Commodity Can Be Balanced?

The plan consistency in connection with the growth rate and the financial resources of the plan. But for sake of sustained economic development, two other problems inflation and deficit in BOP should also be tackled properly. Therefore, to so we will have to bring a consistency, the balancing situation in respect of demand for and supply of goods. In other words, both the sides of commodity equation will have to be equalized.

To construct the equation regarding the demand for and supply of goods we will have to discuss the problems pertaining to supply and demand. Regarding supply, the issue is of production proportion of goods and services. While determining the growth rate, one has to indicate the changes in the level of production.

But it is not sufficient; the planners have to keep in view the distribution of goods and services with respect to different sectors of economy. For example, if services sector expands more rapidly as compared with good sectors, then demand for goods will rise more than the supply of the goods. This may result in inflation as well as deficit in BOP.No doubt, the process of development requires the expansion of services sector, but it should not expand ruthlessly.