{"id":237925,"date":"2023-04-14T17:17:35","date_gmt":"2023-04-14T11:47:35","guid":{"rendered":"https:\/\/blog.forumias.com\/?page_id=237925"},"modified":"2023-05-19T19:34:12","modified_gmt":"2023-05-19T14:04:12","slug":"planning","status":"publish","type":"page","link":"https:\/\/forumias.com\/blog\/planning\/","title":{"rendered":"Planning in India"},"content":{"rendered":"<p>&nbsp;<\/p>\n<p>Planning is the process of setting up objectives to achieve desired goals. Planning Commission in India was established as a non-constitutional and non-statutory body in 1950.<\/p>\n<p>Economic planning involves allocation of resources based on the availability and socio-economic goals.<\/p>\n<h2>Planning: Need<\/h2>\n<ul>\n<li>Physical, financial and human resources are scarce in nature.<\/li>\n<li>History of colonial exploitation has resulted in centuries of drain of wealth.<\/li>\n<li>In 1950s, there was a looming threat of capitalism being exploitative in nature too.<\/li>\n<li>Physical infrastructure in terms of irrigation, power, transport, roads were at a bare minimum.<\/li>\n<li>Socio-economic indicators such as health, education, sanitation which determined the quality of life of people were poor.<\/li>\n<li>India being a young democracy was fragile due to the consequences of Partition.<\/li>\n<\/ul>\n<h2>Planning: Objectives<\/h2>\n<ul>\n<li>To ensure wholistic economic growth in terms of increasing GDP and Per capita income.<\/li>\n<li>To modernize India in terms of physical infrastructure by adopting right machinery.<\/li>\n<li>To be self-reliant by utilizing the available resources efficiently.<\/li>\n<li>To ensure social justice through equitable distribution of wealth and resources.<\/li>\n<\/ul>\n<h2>\u00a0Planning: Types<\/h2>\n<ul>\n<li>Democratic planning where the plan is formulated by elected representatives.<\/li>\n<li>Indicative planning where both public and private sector participate in planning but the core industries remain nationalised. It is usually followed in mixed economies such as India.<\/li>\n<li>Imperative planning where full control is exercised by the State in making the plan. It is a target-based planning where there is no role for market.<\/li>\n<li>Normative Planning involves bottom-up planning where the local inputs are considered while planning.<\/li>\n<li>Perspective planning where long term implications of short\/medium term policies are considered. It is a kind of vision document.<\/li>\n<li>Financial planning where the resources allocated\/ estimated in monetary terms reflecting the financial situation better.<\/li>\n<li>Physical planning where resources allocated\/ estimated in real terms. For e.g., labour force, capital stock<\/li>\n<li>Rolling Plan\/ Continuous Planning is a process where medium term plan is prepared and assessment of previous plan is included too.<\/li>\n<\/ul>\n<h2>Planning Commission: India\u2019s Five year plans<\/h2>\n<table style=\"width: 97.5144%;\">\n<tbody>\n<tr>\n<td style=\"width: 44.4574%;\" width=\"300\"><strong>First Five Year Plan: 1951-1955<\/strong><\/td>\n<td style=\"width: 92.0041%;\" width=\"300\">\n<ul>\n<li>Harrod Domar Model which led to high investment in heavy industries<\/li>\n<li>Focus areas were Irrigation (Bhakra Nangal, Damodar, Hirakund); Land Reforms; Higher Education<\/li>\n<\/ul>\n<\/td>\n<\/tr>\n<tr>\n<td style=\"width: 44.4574%;\" width=\"300\"><strong>Second Five Year Plan: 1956-1960<\/strong><\/td>\n<td style=\"width: 92.0041%;\" width=\"300\">\n<ul>\n<li>Mahalanobis Strategy emphasized on strengthening\u00a0 heavy industry based (Durgapur, Bhilai, Rourkela Steel Plants)<\/li>\n<li>Financial and Technical assistance boost from USSR, UK, West Germany.<\/li>\n<\/ul>\n<\/td>\n<\/tr>\n<tr>\n<td style=\"width: 44.4574%;\" width=\"300\"><strong>Third Five Year Plan:1961-1966<\/strong><\/td>\n<td style=\"width: 92.0041%;\" width=\"300\">\n<ul>\n<li>In the backdrop of Indo-Pak War, Sino-India War, a 2-year continuous drought and 30% fall in food grain<\/li>\n<li>PL480 aid\u00a0 from USA and followed Gadgil formula to allocate grants.<\/li>\n<\/ul>\n<\/td>\n<\/tr>\n<tr>\n<td style=\"width: 44.4574%;\" width=\"300\"><strong>Plan holidays: 1966-1969<\/strong><\/td>\n<td style=\"width: 92.0041%;\" width=\"300\">\n<ul>\n<li>Included 3 Annual plans; Focus on increasing exports<\/li>\n<li>New Agriculture Strategy with HYV seeds and Irrigation<\/li>\n<\/ul>\n<\/td>\n<\/tr>\n<tr>\n<td style=\"width: 44.4574%;\" width=\"300\"><strong>Fourth Five Year Plan:1969-1974<\/strong><\/td>\n<td style=\"width: 92.0041%;\" width=\"300\">\n<ul>\n<li>Socialist tilt under Indira Gandhi; 14 Banks nationalised; Abolition of Privy purses<\/li>\n<li>Green revolution; Indo-Pak war and Refugee crisis from Bangladesh<\/li>\n<\/ul>\n<\/td>\n<\/tr>\n<tr>\n<td style=\"width: 44.4574%;\" width=\"300\"><strong>Fifth Five Year Plan:1974-1979<\/strong><\/td>\n<td style=\"width: 92.0041%;\" width=\"300\">\n<ul>\n<li>Focused on Poverty Alleviation Programme; Slogan was &#8216;Garibi Hatao&#8217;<\/li>\n<li>Launched Minimum Needs Programme and Twenty-point programme<\/li>\n<li>Carried out in the\u00a0 backdrop of Emergency<\/li>\n<\/ul>\n<\/td>\n<\/tr>\n<tr>\n<td style=\"width: 44.4574%;\" width=\"300\"><strong>Rolling Plan:1978-1979<\/strong><\/td>\n<td style=\"width: 92.0041%;\" width=\"300\">\n<ul>\n<li>Appraisal of Plan Performance before next year plan<\/li>\n<\/ul>\n<\/td>\n<\/tr>\n<tr>\n<td style=\"width: 44.4574%;\" width=\"300\"><strong>Sixth Five Year Plan:1980-1985<\/strong><\/td>\n<td style=\"width: 92.0041%;\" width=\"300\">\n<ul>\n<li>Gradual Liberalisation of the economy; National Rural Employment Programme; Integrated Rural Development Programme; Shift from Heavy industrialisation to Infrastructure<\/li>\n<\/ul>\n<\/td>\n<\/tr>\n<tr>\n<td style=\"width: 44.4574%;\" width=\"300\"><strong>Seventh Five Year Plan:1985-1990<\/strong><\/td>\n<td style=\"width: 92.0041%;\" width=\"300\">\n<ul>\n<li>Focus on Service Sector and liberalisation continued<\/li>\n<li>Technological Reforms by Rajiv Gandhi government<\/li>\n<\/ul>\n<\/td>\n<\/tr>\n<tr>\n<td style=\"width: 44.4574%;\" width=\"300\"><strong>Two Annual Plans:1990-1992<\/strong><\/td>\n<td style=\"width: 92.0041%;\" width=\"300\">\n<ul>\n<li>In the backdrop of political instability and economic crisis<\/li>\n<li>1991 Reforms were implemented<\/li>\n<\/ul>\n<\/td>\n<\/tr>\n<tr>\n<td style=\"width: 44.4574%;\" width=\"300\"><strong>Eighth Five Year Plan:1992-1997<\/strong><\/td>\n<td style=\"width: 92.0041%;\" width=\"300\">\n<ul>\n<li>First plan after LPG reforms, High GDP growth-13%; fiscal deficit and CAD were very low; Investment in infrastructure; Restructuring subsidies; Decentralised planning; Problem of Jobless growth<\/li>\n<\/ul>\n<\/td>\n<\/tr>\n<tr>\n<td style=\"width: 44.4574%;\" width=\"300\"><strong>Ninth Five Year Plan:1997-2002<\/strong><\/td>\n<td style=\"width: 92.0041%;\" width=\"300\">\n<ul>\n<li>Exports declined due to East Asian Crisis and\u00a0 foreign capital inflows reduced<\/li>\n<li>Coalition government created political instability<\/li>\n<li>Sanctions were imposed due to Pokhran Nuclear Test<\/li>\n<li>Focus areas of the plan: Population control; Generating employment; poverty reduction ; self-reliance in agriculture.<\/li>\n<\/ul>\n<\/td>\n<\/tr>\n<tr>\n<td style=\"width: 44.4574%;\" width=\"300\"><strong>Tenth Five Year Plan:2002-2007<\/strong><\/td>\n<td style=\"width: 92.0041%;\" width=\"300\">\n<ul>\n<li>Focus areas of the plan: Doubling per capita income in 10 years; Ensuring proper &#8216;Governance&#8217; and public service delivery;\u00a0 Agriculture as Prime Moving Force (PMF)<\/li>\n<li>Features: Higher Foreign capital inflows and highest growth in services (savings and investment rate crossed 30%)<\/li>\n<\/ul>\n<\/td>\n<\/tr>\n<tr>\n<td style=\"width: 44.4574%;\" width=\"300\"><strong>Eleventh Five Year Plan:2007-2012<\/strong><\/td>\n<td style=\"width: 92.0041%;\" width=\"300\">\n<ul>\n<li>\u2018Fast and inclusive growth\u2019 2008 Global financial crisis<\/li>\n<li>Tendulkar Committee on Poverty Measurement<\/li>\n<li>TFR (Total Fertility Rate) target of 2.1%<\/li>\n<\/ul>\n<\/td>\n<\/tr>\n<tr>\n<td style=\"width: 44.4574%;\" width=\"300\"><strong>Twelfth Five Year Plan:2012-2017<\/strong><\/td>\n<td style=\"width: 92.0041%;\" width=\"300\">\n<ul>\n<li>&#8216;Faster, Sustainable and More Inclusive Growth&#8217;<\/li>\n<li>25 Core monitorable targets<\/li>\n<li>GDP growth at 8%; Agriculture growth at 4% and Manufacturing growth at 10%.<\/li>\n<\/ul>\n<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n<p>&nbsp;<\/p>\n<h2>Planning Commission: Achievements<\/h2>\n<ul>\n<li>India is the fifth largest economy by Gross Domestic Product and third largest economy by Purchasing Power Parity.<\/li>\n<li>Percentage of people below poverty line reduced from 45% in 1994 to 22% in 2023.<\/li>\n<li>All the social indicators such as literacy rate, infant mortality rate, maternal mortality rate, sanitation facilities have immensely improved.<\/li>\n<li>Many steps such nationalization of banks, green revolution, poverty alleviation and self-employment generation programmes have bettered the socio-economic structure of the economy.<\/li>\n<li>Transformative public infrastructure investment in railways, ports, airports, roads has created integrated ecosystem for several industries.<\/li>\n<\/ul>\n<h2>Planning Commission: Issues<\/h2>\n<ul>\n<li>The five year plans could not ensure balanced regional development which was the main drawback.<\/li>\n<li>It adopted a one-size fits all approach because of highly centralized and top down planning mechanism.<\/li>\n<li>Excessive emphasize on heavy industries which had long gestation period and as a result investment in social capital has taken a backseat.<\/li>\n<li>Political interference in the planning process which deviated the set objectives for short term gains.<\/li>\n<\/ul>\n<p>As a result, Planning Commission was dissolved in 2014 and NITI Aayog was established to transform the planning process in India.<\/p>\n<p>&nbsp;<\/p>\n","protected":false},"excerpt":{"rendered":"<p>&nbsp; Planning is the process of setting up objectives to achieve desired goals. Planning Commission in India was established as a non-constitutional and non-statutory body in 1950. Economic planning involves allocation of resources based on the availability and socio-economic goals. Planning: Need Physical, financial and human resources are scarce in nature. History of colonial exploitation&hellip; <a class=\"more-link\" href=\"https:\/\/forumias.com\/blog\/planning\/\">Continue reading <span class=\"screen-reader-text\">Planning in India<\/span><\/a><\/p>\n","protected":false},"author":10341,"featured_media":0,"parent":0,"menu_order":0,"comment_status":"closed","ping_status":"closed","template":"","meta":{"jetpack_post_was_ever_published":false,"footnotes":""},"class_list":["post-237925","page","type-page","status-publish","hentry","entry"],"jetpack_sharing_enabled":true,"_links":{"self":[{"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/pages\/237925","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/pages"}],"about":[{"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/types\/page"}],"author":[{"embeddable":true,"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/users\/10341"}],"replies":[{"embeddable":true,"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/comments?post=237925"}],"version-history":[{"count":0,"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/pages\/237925\/revisions"}],"wp:attachment":[{"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/media?parent=237925"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}