Niti Aayog And Economy

Introduction :
On 13 August 2014, the Union Cabinet scrapped the Planning Commission, to be replaced
with a diluted version of the National Advisory Councill (NAC) of India. On 1 January 2015,
a Cabinet resolution was passed to replace the Planning Commission with the newly
formed NITI Aayog (National Institution for Transforming India). Union Government of
India announced the formation of NITI Aayog on 1 January 2015. The first meeting of NITI
Aayog was chaired by Narendra Modi on 8 February 2015.

Objectives Of Niti Aayog :

 To develop mechanisms to formulate credible plans at the village level and
aggregate these progressively at higher levels of government.
 To ensure, on areas that are specifically referred to it, that the interests of national
security are incorporated in economic strategy and policy.
 To pay special attention to the sections of our society that may be at risk of not
benefiting adequately from economic progress.
 To design strategic and long-term policy and programme frameworks and
initiatives, and monitor their progress and their efficacy. The lessons learnt
through monitoring and feedback will be used for making innovative
improvements, including necessary mid-course corrections.
 To provide advice and encourage partnerships between key stakeholders and
national and international like-minded think tanks, as well as educational and
policy research institutions.
 To create a knowledge, innovation and entrepreneurial support system through a
collaborative community of national and international experts, practitioners and
other partners.
 To offer a platform for the resolution of inter-sectoral and inter departmental
issues in order to accelerate the implementation of the development agenda.

Members Of Niti Aayog :

On 18 September 2021, the Hon'ble Prime Minister approved the reconstitution of NITI
Aayog, as under: 
 
1. Chairperson: Hon'ble Shri Narendra Modi, Prime Minister of India 
 
2. Vice Chairperson: Dr Rajiv Kumar 
 
3. Full-Time Members:
 Shri VK Saraswat
 Prof. Ramesh Chand
 Dr VK Paul 

 
4. Ex-Officio Members: 
 Shri Rajnath Singh, Minister of Defence
 Shri Amit Shah, Minister of Home Affairs and Minister of Cooperation
 Smt. Nirmala Sitharaman, Minister of Finance and Minister of Corporate Affairs
  Shri Narendra Singh Tomar, Minister of Agriculture and Farmers' Welfare

 
5. Special Invitees: 
 Shri Nitin Jairam Gadkari, Minister of Road Transport and Highways
 Shri Piyush Goyal, Minister of Commerce and Industry, Minister of Consumer
Affairs, Food and Public Distribution, and Minister of Textiles 
 Dr Virendra Kumar, Minister of Social Justice and Empowerment 
 Shri Ashwini Vaishnaw, Minister of Railways, Minister of Communications, and
Minister of Electronics and Information Technology
 Shri Rao Inderjit Singh, Minister of State (Independent Charge) of the Ministry of
Statistics and Programme Implementation, Minister of State (Independent Charge)
of the Ministry of Planning, and Minister of State in the Ministry of Corporate
Affairs .

 
 Niti Aayog Policies :
 Atal Innovation Mission (AIM): Atal Innovation Mission (AIM) is Government
of India’s flagship initiative to create and promote a culture of innovation and
entrepreneurship across the length and breadth of our country. AIM’s objective is to
develop new programmes and policies for fostering innovation in different sectors
of the economy, provide platforms and collaboration opportunities for different
stakeholders, and create an umbrella structure to oversee the innovation &
entrepreneurship ecosystem of the country.

 Atal Mission for Rejuvenation and Urban Transformation

(AMRUT) :  The purpose of Atal Mission for Rejuvenation and Urban
Transformation (AMRUT) is to (i) ensure that every household has access to a tap
with assured supply of water and a sewerage connection; (ii) increase the amenity
value of cities by developing greenery and well maintained open spaces (e.g. parks);
and (iii) reduce pollution by switching to public transport or constructing facilities
for non-motorized transport (e.g.walking and cycling).

 15 Year Road Map : The road map envisages economic and development
standing of the country in 2031 and will, accordingly, recommend streamlining
different sectors of the economy. 

Niti Aayog Divisions : NITI Aayog’s entire gamut of activities is divided into two
main hubs: Team India and Knowledge and Innovation. The two hubs are at the core of
NITI Aayog’s efficient functioning. The Team India Hub carries out the mandate of
fostering cooperative federalism and designing policy and programme frameworks. It
provides requisite coordination and support in NITI Aayog’s engagement with States.
The Knowledge and Innovation Hub maintains a state-of-the-art resource centre, a
repository of research on good governance and best practices, provides advice and
encourages partnerships with key stakeholders, including colleges, universities, think
tanks and non-governmental organizations at home and abroad.
 NITI Aayog uniquely focuses on thematic policy interventions that
encourage convergence across Central Ministries, State Governments,
development partners, sectoral experts and professionals. This approach to
governance is applied to achieve the objectives:
 To design strategic and long-term policy and programme frameworks and initiatives, and
monitor their progress and their efficacy. The lessons learnt through monitoring and
feedback will be used for making innovative improvements, including necessary mid-
course corrections.
 To provide advice and encourage partnerships between key stakeholders and national
and international like-minded think tanks, as well as educational and policy research
institutions.
 To create a knowledge, innovation and entrepreneurial support system through a
collaborative community of national and international experts, practitioners and other
partners.
 To offer a platform for the resolution of inter-sectoral and inter-departmental issues to
accelerate the implementation of the development agenda.

 7 pillars of effective governance : NITI Aaayog is based on the 7 pillars of

effective governance  

(1) Pro-People

(2) Pro-Activity

(3) Participation

(4) Empowering

(5) Inclusion of all

(6) Equality

(7) Transparency.

Niti Aayog Composition : Strategy and Planning in the NITI Aayog will be
anchored from State-level. Regional Councils will be convened by the Prime Minister for
identified priority domains, put under the joint leadership of related sub-groups of
States (grouped around commonalities which could be geographic, economic, social or
otherwise) and Central Ministries.

Regional Councils :
 Have specified tenures, with the mandate to evolve a strategy and oversee
implementation.
  Be jointly headed by one of the groups Chief Ministers (on a rotational basis or
otherwise) and a corresponding Central Minister.
 Include the sectoral Central Ministers and Secretaries concerned, as well as State
Ministers and Secretaries. It will be linked to corresponding domain experts and
academic institutions.
 Have a dedicated support cell in the NITI Aayog Secretariat.
 States would thus be empowered to drive the national agenda. As a consequence,
deliberation would be more grass-roots informed, and recommendations would
have more ownership, given their joint formulation.
 Special Invitees: experts, specialists and practitioners with relevant domain
knowledge as special invitees nominated by the Prime Minister.

Full-time Organisational Framework:

Will comprise of, in addition to the Prime Minister as the Chairperson:

1. Vice-Chairperson: to be appointed by the Prime Minister.

2. Members: full-time: specialists with international exposure.
3. Part-time Members: maximum of 2, from leading universities, research
organizations and other relevant institutions in an ex-officio capacity. Part-time
members will be on a rotational basis.
4. Ex-Officio Members: maximum of 4 members of the Union Council of Ministers to
be nominated by the Prime Minister.
5. Chief Executive Officer: to be appointed by the Prime Minister for a fixed tenure,
in the rank of Secretary to the Government of India.
6. Secretariat: as deemed necessary.

NITI Aayog specialized Wings :

 Research Wing – that will develop in-house sectoral expertise as a dedicated think
tank of top domain experts, specialists and scholars.
 Consultancy Wing – that will provide a marketplace of whetted panels of expertise
and funding for Central and State Governments to tap into; matching their
requirements with solution providers, public and private, national and
international. By playing matchmaker instead of providing the entire service itself,
NITI Aayog will be able to focus its resources on priority matters, providing
guidance and an overall quality check to the rest.
 Team India Wing  – comprising representatives from every State and Ministry,
will serve as a permanent platform for national collaboration.

Achievements Of Niti Aayog:

Reforms in Agriculture:
 

Modern Agricultural Law : Taking note of increasing incidents of leasing in and out of
land and suboptimal use of land with lesser number of cultivators, NITI Aayog has
formulated a Model Agricultural Land Leasing Act, 2016 to both recognize the rights of the
tenant and safeguard interest of landowners. A dedicated cell for land reforms was also
set up in NITI. Based on the model act, Madhya Pradesh has enacted separate land leasing
law and Uttar Pradesh and Uttarakhand have modified their land leasing laws. Some
States, including Odisha, Andhra Pradesh and Telangana, are already at an advance stage
of formulating legislations to enact their land leasing laws for agriculture.

Reforming Medical Education :A committee chaired by Vice Chairman, NITI Aayog

recommended scrapping of the Medical Council of Indi and suggested a new body for
regulating medical education. The draft legislation for the proposed National Medical
Commission has been submitted to the Government for further necessary action.

  Digital Payments Movement:

a.       An action plan on advocacy, awareness and co-ordination of handholding efforts

among general public, micro enterprises and other stakeholders was prepared.
Appropriate literature in print and multimedia was prepared on the subject for
widespread dissemination. Presentations/ interactions were organized by NITI Aayog for
training and capacity building of various Ministries/Departments of Government of India,
representatives of State/UTs, Trade and Industry Bodies as well as all other
stakeholders.    

b.      NITI Aayog also constituted a Committee of Chief Ministers on Digital Payments on

30th November 2016 with the Chief Minister of Andhra Pradesh, Chandrababu Naidu, as
the Convener to promote transparency, financial inclusion and a healthy financial
ecosystem nationwide.  The Committee submitted its interim report to Hon’ble Prime
Minister in January 2017.

c.       To incentivize the States/UTs for promotion of digital transactions, Central assistance
of Rs. 50 crore would be provided to the districts for undertaking Information, Education
and Communication activities to bring 5 crore Jan Dhan accounts to digital platform.

Three Year Action Plan : India’s developmental planning, which started in 1951,
came to a conclusion in March 2017 with the end of the Twelfth Five Year Plan. After the
dissolution of the Planning Commission, the government decided to set its development
priorities and instrumentalise those priorities through the NITI Aayog. One of the major
mandates of the NITI Aayog is “to design strategic and long-term policy and programme
frameworks and initiatives.” In this direction, the NITI Aayog was advised to prepare a 15-
year vision document, a seven-year strategy, and a three-year action agenda. Towards
achieving this end, the NITI Aayog formulated a “Three Year Action Agenda, 2017–18 to
2019–20” in August 2017. The document proposes a set of action points for policy and
institutional reforms in various sectors of the economy .

Difference between NITI Aayog and Planning Commission

ORGANIZATION:

 Planning Commission – Had deputy chairperson, a member secretary, and full-

time members. Secretaries or member secretaries appointed by the usual process.
 NITI Aayog – New posts of CEO of secretary rank, and Vice-Chairperson. Will also
have five full-time members and two part-time members. Four cabinet ministers
will serve as ex-officio members. CEO is appointed directly by Prime Minister.

PLANNING:

 Planning commission goes for top-down planning for government with public
sector resources.
 NITI ayog formulate national development strategy in a market economy
integrated with the globalized world.

RELATION WITH STATES :

 The planning commission was a central government institution and no

representation of state government. There was no structural mechanism for
interaction with states.
 NITI ayog provides a partnership with state governments to promote co-operative
federalism. It provides a platform for structured and regular interaction with
states.

FINANCE :

 The role of Finance Commission was greatly reduced with the formation of
Planning Commission. Allocation of funds were decided by the Planning
Commission.
 NITI aayog don’t any role in fund allocation. Finance ministry to decide the share
of taxes to states, fund allocation to CSS and Union assistance to the state plan.
 CONSTITUTION AND REPORTING :

 Planning Commission- The commission reported to National Development Council

that had State Chief Ministers and Lieutenant governors.
 Niti Aayog – Governing Council has State Chief Ministers and Lieutenant
Governors.

Niti Aayog Indices :

 Agriculture Transformation Index :
 NITI Aayog is working on an Agriculture Transformation Index, which will measure
the performance of States across six pillars: inputs, sustainability, productivity and
diversification, policy, preservation, processing and exports, and farmers’ income
and welfare. The index is aimed at capturing the new policy paradigm in
agriculture—at the core of which are sustainable intensification and increasing
farmers’ income.
 Global Innovation Index :
 NITI Aayog has been continuously working towards improving India’s ranking in
the global indices, including the Global Innovation Index. The Science and
Technology Vertical is the nodal department in NITI with respect to improving
India’s ranking in the Global Innovation Index. The Vertical has been in touch with
the publishing agency World Intellectual Property Organization as well as Line
Ministries to address gaps in the availability of reliable data. NITI Aayog is working
proactively towards bringing policy interventions that could leverage India’s
underlying potential .
 India Innovation Index :
 The India Innovation Index is released by NITI Aayog and the Institute for
Competitiveness every year. The index attempts to create an extensive framework
for the continuous evaluation of the innovation environment in all States and Union
Territories; it ranks them on the basis of their scores. NITI Aayog released the
second edition on 20 January 2021. NITI is also handholding States and Union
Territories in improving their rankings in the index, which will subsequently result
in the improvement of India’s ranking in the Global Innovation Index.
 State Energy Index :
 NITI Aayog is working on a State Energy Index to assess the performance of States
based on indicators covering the discoms’ viability and competition, access,
affordability and reliability of energy, clean energy initiatives, energy efficiency,
etc. The index will further improve States’ performance to efficiently manage their
energy resources.
Changes required in NITI Aayog ( Suggestions):
 The need of the hour is that NITI Aayog has to evolve into a much stronger
organization as compared to what it is now. NITI Aayog should be engaged with
the allocation of “transformational” capital in a formulaic manner, complete with
incentive-compatible conditionalities. As now when the Planning Commission
has been dissolved, there is a vacuum especially as the NITI Aayog is primarily a
think tank with no resources to dispense, which renders it toothless to
undertake a “transformational” intervention.
 The implications that should be enforced in a complex country like India which
has become an industrial economy late is that the planning must continue as a
central function of the state to bring the economy to long-run equilibrium.
 However, it can be contended that the Planning Commission was not able to
fulfill its function adequately. The reason why NITI Aayog came into force by
replacing the Planning Commission, there was a necessity to grow into a much
stronger organization.

Conclusion :
NITI Aayog should focus on the implementation rather than only focusing upon the
recommendations of the policies. It should also be focussing upon the reforms and
informing the government as to where it will have to face the consequences for non-
implementation of its policies and where it is falling short. The establishment of NITI Aayog
gave positive results but there is a need to change and focus on areas that have been
discussed here .

Reference

 https://www.clearias.com
 https://www.examrace.com
 https://www.insightsonindia.com

 https://www.nitiaayog.com