PLANNING COMMISSION

The Planning Commission of India, a governmental body established in 1950 under the
leadership of Prime Minister Jawaharlal Nehru, held the mandate of formulating the nation's
Five-Year Plans and facilitating employment opportunities for all in service to society.
Operating directly under the Prime Minister, the Commission was not constitutionally
mandated but served as a vital arm of the Union Government.
Formed through a Government Resolution in March 1950, the Commission aimed to accelerate
India's socio-economic development by leveraging its resources efficiently, enhancing
productivity, and ensuring equitable employment opportunities. Pandit Nehru assumed the role
of the Commission's first Chairman, overseeing the implementation of the inaugural Five-Year
Plan in 1951, followed by subsequent plans until 1965, when external factors such as conflict
with Pakistan disrupted the planning process.
Challenges like drought, economic fluctuations, and resource depletion led to deviations from
the Five-Year Plan model, prompting the adoption of Annual Plans from 1966 to 1969. The
resumption of the Five-Year Plans occurred with the launch of the Fourth Plan in 1969, albeit
with modifications in approach.

Political dynamics delayed the initiation of the Eighth Plan in 1990, necessitating interim
Annual Plans for the years 1990-91 and 1991-92. The Eighth Plan commenced in 1992,
coinciding with the government's implementation of economic liberalization policies.
Initially, the focus of planning was on fostering a robust public sector through substantial
investments in heavy and core industries. However, with the onset of the Ninth Plan in 1997,
there was a paradigm shift towards a more indicative approach to planning, prioritizing
flexibility and adaptability in response to evolving economic conditions.
COMMENCEMENT OF NITI AAYOG
The establishment of NITI Aayog on January 1 2015, marked a significant milestone in India's
governance landscape. Derived from Sanskrit, "NITI" originally conveys connotations of
morality and guidance, but in its contemporary usage, it signifies "policy," encapsulating the
institution's role as the "National Institution for Transforming India." Positioned as the apex
body for policy formulation, NITI Aayog is tasked with catalysing the nation's economic
growth trajectory, ultimately striving to propel India into a prominent global economic player.
Comprising two core hubs, namely the "Team India Hub" and the "Knowledge and Innovation
Hub," NITI Aayog embodies a multifaceted approach towards its objectives. The Team India
Hub facilitates enhanced collaboration between the central government and individual states,
fostering a synergistic approach towards governance. Concurrently, the Knowledge and
Innovation Hub serve as a repository of intellectual capital, bolstering the institution's capacity
as a think tank and fostering a culture of innovation and knowledge dissemination.
Furthermore, NITI Aayog is in the process of evolving into a State of Art Resource Centre,
equipped with the requisite resources, expertise, and agility to respond effectively to emerging
challenges. By leveraging its capabilities, NITI Aayog endeavours to provide timely policy
insights to the government, spearhead research and innovation initiatives, and navigate
unforeseen contingencies with agility and foresight.
The rationale behind the establishment of NITI Aayog stems from the imperative of addressing
evolving governance paradigms and public expectations. Recognizing the need for institutional
reforms and strategic realignments, NITI Aayog seeks to foster a conducive ecosystem forlarge-
scale transformative change, thereby fulfilling the aspirations of the populace for
inclusive growth and development through active citizen engagement.
13 OBJECTIVES OF NITI AAYOG
1. The active participation of States in the light of national objectives and to provide a
framework ‘national agenda’.
2. To promote cooperative federalism through well-ordered support initiatives and
mechanisms with the States on an uninterrupted basis.
3. To construct methods to formulate a reliable strategy at the village level and aggregate
these gradually at higher levels of government.
4. An economic policy that incorporates national security interests.
5. To pay special consideration to the sections of the society that may be at risk of not
profiting satisfactorily from economic progress.
6. To propose strategic and long-term policy and programme frameworks and initiatives,
and review their progress and their effectiveness.
7. To grant advice and encourage partnerships between important stakeholders and
national-international Think Tanks, as well as educational and policy research
institutions.
8. To generate knowledge, innovation, and entrepreneurial support system through a
shared community of national and international experts, etc.
9. To provide a platform for resolution of inter-sectoral and inter-departmental issues to
speed up the accomplishment of the progressive agenda.
10. To preserve a state-of-the-art Resource Centre, be a repository of research on good
governance and best practices in sustainable and equitable development as well as help
their distribution to participants.
11. To effectively screen and assess the implementation of programmes and initiatives,
including the identification of the needed resources to strengthen the likelihood of
success.
12. To pay attention to technology improvement and capacity building for the discharge of

Programs and initiatives.

13. To undertake other necessary activities to the implementation of the national

Development agenda, and the objectives.

NITI AAYOG V. PLANNING COMMISSION

 1. Membership Structure:

• Planning Commission: With a fixed number of 8 full-time members, the

Planning Commission had a stable composition, but it lacked flexibility in

Accommodating additional expertise or diverse perspectives.

• NITI Aayog: The NITI Aayog, on the other hand, maintains a smaller core team

Of full-time members, allowing for the inclusion of part-time members as

Required. For instance, NITI Aayog can invite domain experts or stakeholders

For specific projects or consultations, enhancing its versatility and adaptability.

2. Financial Influence:

• Planning Commission: The Planning Commission wielded significant financial

Clout, as it had the authority to allocate funds to various ministries and state

Governments based on the priorities outlined in the Five-Year Plans.

• NITI Aayog: In contrast, NITI Aayog functions primarily as a think tank and
Advisory body, lacking the direct power to allocate funds. Instead, it provides

Recommendations and policy guidance to the government based on its research

And analysis.

3. Role of States:

• Planning Commission: State involvement in the Planning Commission was

Primarily limited to interactions during the National Development Council

(NDC) meetings and annual Plan discussions. States had less autonomy in

Decision-making processes.

• NITI Aayog: NITI Aayog promotes a more collaborative approach, where state

Governments play a more active role in the decision-making process. Forexample, NITI Aayog’s
Governing Council includes Chief Ministers of all states

And Union Territories, fostering greater participation and partnership in policy

Formulation.

4. Leadership and Secretarial Appointments:

• Planning Commission: Secretaries or member secretaries of the Planning

Commission were appointed through the standard bureaucratic process, with

Appointments often following seniority and administrative protocol.

• NITI Aayog: In NITI Aayog, the top executive position is referred to as the

CEO, who is appointed directly by the Prime Minister. This direct appointment

Signifies a more centralized leadership structure aimed at streamlining decision-

Making processes.

5. Policy Formation and Consultation:

• Planning Commission: The Planning Commission traditionally formulated

Policies independently and then consulted states regarding fund allocation, often

Adopting a top-down approach.

• NITI Aayog: NITI Aayog emphasizes a collaborative and consultative approach

To policy formulation. It engages with states from the initial stages of policy

Development, seeking their inputs and feedback to ensure inclusivity and

Relevance.

6. Power to Impose Policies:

• Planning Commission: The Planning Commission had the authority to impose

Policies on states, sometimes leading to criticism of centralized decision-

Making and lack of autonomy at the state level.

• NITI Aayog: Unlike the Planning Commission, NITI Aayog lacks the power to

Impose policies. Instead, it operates as an advisory body, offering

Recommendations and suggestions to the government while respecting the

Autonomy of states and other stakeholders.

Major Initiatives Taken by NITI Aayog

1.Aspirational District Programme

2.SDG India Index

3.SATH Project
4.Composite Water Management Index

5.Health Index

6.Atal Innovation Mission

7.School Education Quality Index

8.Agriculture Marketing and Farmer Friendly Reform Index

9.District Hospital Index

10.Good Governance Index

11.Strategy for New India at 75

12.India Innovation Index

13.Women Transforming India Awards

14.Women Entrepreneurship Platform (WEP)

15.e-AMRIT Portal

16.Methanol Economy’ programme

Success of NITI Ayog

1.Agricultural reforms:

NITI Aayog has made significant strides in agricultural reforms, contributing to the

Modernization and enhancement of India’s agricultural sector. One of its notable

Successes is the implementation of the Pradhan Mantri Fasal Bima Yojana (PMFBY).

This crop insurance scheme aims to provide financial protection to farmers against crop

Losses due to natural calamities, pests, and diseases. By mitigating the risks associated

With farming, PMFBY encourages farmers to adopt modern agricultural practices, leading

To improved productivity and income levels.

Additionally, NITI Aayog has been instrumental in advocating for reforms in agricultural

Marketing through initiatives such as the Agricultural Produce Market Committee

(APMC) Act reforms. These reforms enable farmers to sell their produce directly to

Buyers, reducing reliance on intermediaries and ensuring better prices for their crops. By

Promoting a more liberalized and efficient agricultural market, NITI Aayog contributes to

Increasing farmers’ income and reducing post-harvest losses.

Moreover, NITI Aayog’s efforts in facilitating technology adoption and innovation in

Agriculture, such as through the Atal Innovation Mission, further enhance the sector’s

Productivity and resilience. Overall, NITI Aayog’s initiatives in agricultural reforms

Demonstrate its commitment to modernizing India’s agriculture and improving the

Livelihoods of farmers across the country.

2. Health Initiatives: NITI Aayog has spearheaded several health initiatives aimed at

Improving healthcare accessibility, affordability, and quality across India. One of its

Flagship programs is the Ayushman Bharat Pradhan Mantri Jan Arogya Yojana (AB-

PMJAY), which is the world’s largest health insurance scheme. AB-PMJAY provides health

Insurance coverage of up to ₹5 lakh per family per year for secondary and tertiary

Healthcare services, benefiting over 500 million vulnerable individuals.

Furthermore, NITI Aayog has been actively involved in promoting digital health solutions

Through initiatives like the National Digital Health Mission (NDHM). NDHM aims to create a
digital healthcare ecosystem that enables seamless access to healthcare services
and health records for all citizens.
Additionally, NITI Aayog has emphasized preventive healthcare through initiatives such as
the National Nutrition Mission (POSHAN Abhiyaan), which focuses on addressing
malnutrition and promoting maternal and child health.
Moreover, NITI Aayog has played a crucial role in promoting innovation and research in
healthcare through collaborations with academic institutions, industry, and international
partners. Initiatives like the Atal Innovation Mission (AIM) provide support and funding to
startups and innovators in the healthcare sector, fostering a culture of innovation and
entrepreneurship.
Overall, NITI Aayog's health initiatives reflect its commitment to improving healthcare
outcomes and promoting innovation in the Indian healthcare system.
3.Digital transformation in Niti Ayog:
NITI Aayog has been instrumental in driving digital transformation across various sectors
in India, marking several notable successes in this domain:
1.National Digital Health Mission (NDHM): NITI Aayog played a crucial role in
conceptualizing and implementing the NDHM, which aims to create a digital health
ecosystem by digitizing health records, facilitating telemedicine, and ensuring
interoperability among healthcare providers. The mission has the potential to revolutionize
healthcare delivery by improving access, efficiency, and quality of care.
2.Digital Payments and Financial Inclusion: NITI Aayog has actively promoted digital
payments and financial inclusion initiatives such as the Pradhan Mantri Jan Dhan Yojana
(PMJDY) and the Unified Payments Interface (UPI). These efforts have led to a significant
increase in the adoption of digital payment methods, making financial services more
accessible to millions of Indians.
3.Digital Infrastructure Development: NITI Aayog has been involved in initiatives to
enhance digital infrastructure, such as the BharatNet project, which aims to provide high-
speed broadband connectivity to rural areas. By improving internet connectivity and access
to digital services, these initiatives empower citizens and businesses, fostering economic
growth and development.
4.Promotion of Innovation and Entrepreneurship: Through initiatives like the Atal
Innovation Mission (AIM), NITI Aayog supports startups and innovators in leveraging
technology to address socio-economic challenges. AIM provides funding, mentorship, and
incubation support to promote innovation across various sectors, contributing to India's
digital transformation.
5.Data Governance and Privacy: NITI Aayog has been actively involved in the

Formulation of policies related to data governance and privacy, ensuring that India’s digital

Ecosystem operates in a secure and responsible manner. This includes initiatives to develop

Frameworks for data protection and promote responsible data usage.

Overall, NITI Aayog’s efforts in driving digital transformation have been instrumental in

Harnessing the power of technology to accelerate socio-economic development and

Improve the lives of millions of Indians.

4.Urban Development:

NITI Aayog has played a pivotal role in promoting cooperative federalism in urban

Development through various initiatives. One notable program is the Smart Cities Mission,
Launched in 2015, which aims to develop 100 cities across India into smart cities by

Leveraging technology and innovation to improve urban infrastructure and services. NITI

Aayog facilitates cooperation between the central government, state governments, and

Urban local bodies in implementing this mission, fostering a collaborative approach to

Urban planning and development. Additionally, the Atal Mission for Rejuvenation and

Urban Transformation (AMRUT) focuses on providing basic amenities like water supply,

Sewerage, and urban transport to improve the quality of life in cities. Through these

Initiatives, NITI Aayog promotes inclusive and sustainable urban development while

Encouraging states to take proactive measures to address urban challenges and improve

Living standards for citizens.

5. Cooperative federalism: It is a guiding principle for NITI Aayog, facilitating

Collaboration between the central government and state governments for effective

Governance and policy implementation. The institution serves as a platform for dialogue,

Where states actively participate in the decision-making process. Through consultations and
Interactions, NITI Aayog fosters an environment of mutual cooperation and understanding

Among stakeholders.

NITI Aayog encourages joint planning and implementation of policies and programs,

Recognizing the diversity of challenges and opportunities across states. It supports states in

Aligning national priorities with local needs, ensuring that policies are tailored to address

Regional disparities and promote inclusive development.

Resource allocation is another area where cooperative federalism is evident. NITI Aayog

Facilitates discussions on fiscal federalism, advocating for equitable distribution of

Resources while promoting fiscal discipline and efficiency in resource utilization.

Moreover, NITI Aayog provides support and guidance to states in various areas, including

Capacity building, policy formulation, and project implementation. By fostering a culture

Of shared responsibility and collaboration, NITI Aayog promotes synergy between different

Tiers of government, ultimately leading to more effective governance and better outcomes
For citizens. Overall, cooperative federalism lies at the core of NITI Aayog’s approach,

Driving inclusive and sustainable development across India.

7. Future Directions: Looking ahead, NITI Aayog can further strengthen its role in driving

India’s development agenda by focusing on several key areas for improvement and future

Directions.

Enhancing coordination with states is paramount for NITI Aayog’s success. The institution

Can deepen its engagement with state governments by fostering greater collaboration and

Trust through regular consultations, joint planning sessions, and capacity-building

Initiatives. By understanding and addressing the unique needs and challenges of each state,

NITI Aayog can ensure more effective implementation of policies and programs at the

Grassroots level.

Strengthening data infrastructure is essential for evidence-based policymaking and

Monitoring progress. NITI Aayog can invest in improving data collection, analysis, and

Dissemination mechanisms, leveraging technology and innovation to enhance the quality

And accessibility of data. This will enable better decision-making, facilitate transparency

And accountability, and drive targeted interventions in areas such as healthcare, education,

And agriculture.

Prioritizing sustainability and inclusivity in policymaking should be a core focus for NITI

Aayog. By mainstreaming environmental considerations and social equity principles into

Policy formulation and implementation, the institution can promote sustainable and

Inclusive development that leaves no one behind. This includes integrating climate change

Adaptation and mitigation strategies, promoting renewable energy adoption, and ensuring

Equitable access to essential services for marginalized communities.

In summary, by enhancing coordination with states, strengthening data infrastructure, and

Prioritizing sustainability and inclusivity in policymaking, NITI Aayog can continue to play

A transformative role in shaping India’s development trajectory towards a more prosperous,

Resilient, and equitable future.

Failures of planning commission that were addressed by NITI AYOG

 1. Top-down Approach: The Planning Commission was criticized for its top-down

Approach to economic planning, which often resulted in ineffective implementation

And limited participation from states and other stakeholders. NITI Aayog, on the other

Hand, emphasizes cooperative federalism and encourages greater involvement of

States in the policymaking process, thereby addressing the centralized nature of

Economic planning.

2. Rigid Five-Year Plans: The Planning Commission’s reliance on rigid Five-Year Plans was

Seen as inflexible and unable to adapt to changing economic realities and priorities.

NITI Aayog adopts a more flexible and dynamic approach to planning, focusing on long-

Term visioning and strategic planning while allowing for mid-course corrections based

On emerging challenges and opportunities.

3. Lack of Innovation and Entrepreneurship: The Planning Commission was criticized for

Not adequately promoting innovation and entrepreneurship in India’s economy. NITI

Aayog addresses this by launching initiatives like the Atal Innovation Mission, whichaims to
foster a culture of innovation and entrepreneurship among students and

Startups.

4. Inefficient Resource Allocation: The Planning Commission’s centralized approach to

Resource allocation was often criticized for being inefficient and not responsive to

Regional disparities and local needs. NITI Aayog promotes competitive and cooperative

Federalism, allowing states greater autonomy in resource allocation and decision-

Making, thus addressing the issue of inefficient resource allocation.

5. Limited Engagement with Stakeholders: The Planning Commission was perceived as

Being disconnected from ground realities and lacking adequate engagement with

Stakeholders, including civil society organizations, academia, and the private sector.

NITI Aayog adopts a more inclusive approach by engaging with a diverse range of

Stakeholders in policy formulation and implementation, ensuring greater

Representation and participation in the planning process.