THE PLANNING MACHINERY

PLANNING COMMISSION:The economy of India is based on planning through its five-year plans, developed, executed and monitored by the planning commission which was set up in march 1950, by a resolution of the government of India with the following functions:Assessment of the material, capital and human resources of the country.  Formulation of five-year plans for effective use of these resources.  Periodical analysis of the progress of the plan.  To indicate the factors which are hampering economic development.


NATIONAL DEVELOPMENT COUNCIL:The NDC is presided over by the prime minister and is composed of Union Cabinet Ministers, Chief Ministers of States and Union Territories and Members of the Planning Commission.
FUNCTIONS:y

To prescribe guidelines for the formulation of the national plan including the assessment of the resources for the plan. To consider social and economic policy that affects national development. Provide instructions to the NPC on matters relating to objectives and policies for formulating periodic and annual plans. Provide necessary information to the government on the formulation of periodic plan, annual programme and their budgets.

REVIEW OF THE PLANS

FIRST FIVE YEAR PLAN (1951-1956)
The first five year plan was presented by Jawaharlal Nehru in 1951. It gave importance to agriculture, irrigation and power projects to decrease the country reliance on food grain imports, resolve food crisis and raw material problem especially in jute and cotton. OBJECTIVES:y y y y y y y

Community and agriculture development Power and irrigation Communications and transport Industry Social services Land rehabilitation Target of GDP growth 2.1% per year

ACHIEVEMENTS:y GDP achieved had been 3.6% per year y Net Domestic Product went up by 15% y Development of irrigation projects including Bhakra dam and Hirakud dam y Improvements in roads, railways, telegraphs and posts, manufacture of fertilizers and electrical equipments. y At the end of the plan in 1956, Indian Institute of Technology(IITs) were started as major technical institutions. University grant commission(UGC) were set up to take care of funding and take measures to strengthen the higher education in the country. DISADVANTAGES:y Only few industries were developed y No development of private industry

SECOND FIVE YEAR PLAN(1956-1961) The second five-year plan focused on industry, especially heavy industry. Like the first plan it also mainly focuses on agriculture, domestic production of industries was encouraged particularly of public sector. OBJECTIVES:y To increase the national income by 25% per year y To make the country more industrialized y To increase education and employment opportunities y Development of 1. Mining and industry 2. Community and agriculture development 3. Power and irrigation
4. 5.

Social services Communications and transport

ACHIVEMENTS:y Hydroelectric power projects and five steel mills at Bhilai, Durgapur and Rourkela were established. y Production of coal was increased y More railway lines were added at north east y Improvement of the living standards of the people y The Atomic Energy Commission was formed in 1958 with Homi J. Bhabha as the first chairman.The Tata Institute of Fundamental Research was established as a research institute. In 1957 a talent search and scholarship program was begun to find talented young students to train for work in nuclear power. DISADVANTAGES:y Production was insufficient even for satisfying minimum essential needs of the people. y High tariffs

License were required for starting new companies.This is when India got its License Raj, bureaucratic control over the economy.

THIRD FIVE YEAR PLAN(1961-1966) OBJECTIVES:y More stress to agriculture y To use countrys resources effectively y To increase the production of agriculture so that the nation will be self sufficient in food grains y To provide employment opportunities for every citizen of the country y To establish equality among all the people of the country y Target rate of GDP growth was 4.5% per year

ACHIEVEMENTS:y The construction of dams continued y Many cement and fertilizer plants were also built y Many primary schools were started in rural areas. State electricity boards and state secondary education boards were formed. y States were made responsible for secondary and higher education y Panchayat elections were started and the states were given more development responsibilities y State road transportation corporations were formed and local road building became a state responsibility. y Achieved growth rate of GDP was 4.3% DISADVANTAGES:In 1965-66 India fought a war with Pakistan.As a result their was increase in the price of the products thus resulting in inflation.

FOURTH FIVE YEAR PLAN(1969-1974) At this time Indira Gandhi nationalized 14 major Indian banks there was green revolution in India. OBJECTIVES:y To reform and restructure its expenditure agenda, following the attack on India in the year 1962 and for the second time in the year 1965. y To facilitate growth in exports ACHIEVEMENTS:y Great advancement has been made with regard to Indias national income y Food grains production increased y The need for foreign reserves was felt.This facilitated growth in exports. y Served as a stepping stone for the economic growth.

DISADVANTAGES:y Funds earmarked for the industrial development had to be diverted for the war effort. y Due to famine and drought India didnt pay much heed to long term goals. FIFTH FIVE YEAR PLAN(1974-1979) OBJECTIVES:y To reduce social, regional, and economic disparities for developmental planning y To enhance agricultural productivity y To check rural and urban unemployment y to emphasize on household industries like carpet-weaving, handlooms, sericulture, and handicrafts y to encourage self-employment y to develop labor intensive technological improvements

ACHIVEMENTS:y Food grain production was above 118 million tons due to the improvement of infrastructural facilities like the functioning of the power plants and the rise in the supply of coal, steel, and fertilizers.
y y

Regarding the oil, credibility of Bombay High had shot up the commercial production of oil in India. In 1974-75, Indian exports crossed 18%, and the large earnings from these exports have further increased the Indian foreign exchange reserves. Electricity Supply Act was enacted in 1975, which enabled the Central Government to enter into power generation and transmission. The Indian national highway system was introduced for the first time and many roads were widened to accommodate the increasing traffic. Tourism also expanded.

DISADVANTAGES:y The international economy was in a trouble y The main changes were perceived in sectors such as food, oil, and fertilizers where prices sky-rocketed. y Several inflationary pressures SIXTH FIVE YEAR PLAN(1980-1985) OBJECTIVES:-