Economic Planning In India

Sayed Ghafar -
1758
Murtaza Fazly -
1736
Aaditya - 1701
Santoshi -1757
Abbas Ruat -1751
Marwa Ebad -1730
Muzhda Ebad -1737
Virat Bhatt -1771
Tanuja Naik -1766
Deepa Chowgule-
 Table of contains:
Introduction
What Is Economic Planning?
Features of economic planning
Planning Commission of India
Objectives of economic planning
Five Years Economic Planning of India
Causes of slow growth
NITI AYOG
Conclusion
 Economic Planning

Is the making of major economic decisions. What and

how is to be produced and to whom it is to be allocated –
by the conscious decision of a determinate authority, on
the basis of a comprehensive survey of the economic
system as a whole

First time it was start by PM Jawaharlal Nehru in 1950.

Which is necessary for economic growth and economic
development.
 Need For Economic Planning In India
In an economy like India, the basic socio-
economic problems like:
Poverty
Unemployment
 stagnation in agricultural
Industrial production
Inequality in distribution of income and wealth.
Can hardly be solved within the framework of an
unplanned economy, planning is required to remove
 Economic planning has some essential features:
1. There must be a centralised planning authority for preparing the
plans and suggesting the means for their implementation.

2. Undertake an accurate survey of the available resources and the

essential needs of the country.

3. Some definite aims and objectives.

4. Definite time limit, usually 5 years.

5. Mutual consistency between the targets of the production of the different

sectors.
 The Planning Commission of India

What is the Planning Commission?

When was the Indian Planning Commission set
up?
Whom does the Planning Commission report to?
What does the Planning Commission focus on?
 Objectives of economic planning in India:
1. Rapid economic growth.

2. Expansion of employment

3. Reduction of disparities in income and wealth

4. Prevention of concentration of economic power; and

5. Setting up of a socialistic society based on equality, justice and absence of

exploitation.
6. To improve the national income and raise the standard of living in
the country

7. To attain rapid industrialization with an emphasis on basic and

heavy industries

8. To ensure distributional justice through reduction in inequalities in

income and wealth.

9. Removal of Poverty
 FIRST FIVE YEAR PLAN (1951-1956)
 The First Indian Prime Minister, Jawaharlal
Nehru presented the five year plan to the
parliament of India.
 It was launched in the year 1951.
 Plan gave strong importance to agricultural
sector.
 At the end of the plan period in 1956, five IIT’s
were started.
 SECOND FIVE YEAR PLAN (1956-1961)

Focused on heavy industries

The plan attempted to determine the optimal
allocation of investment between productive sectors
in order to maximise long run economic growth.
 The total amount allocated under the Second Five
Year plan in India was Rs. 48 billion.
 Target Growth rate was 4.5% and the actual growth
rate was 4.2%.
 THIRD FIVE YEAR PLAN (1961-1966)
The third plan stressed on agriculture and
improvement in the production of wheat.
 It’s aim was to make India a ‘self reliant’ and
‘self generating’ economy.
 Target growth rate was 5.6% but the actual
growth rate was only 2.4%.
 Fourth Five Year Plan (1969-1974)
At this time Indira Gandhi was the prime
minister
The Indira Gandhi Government
nationalized 14 major India banks
Green Revolution in India
Target Growth 5.7% Actual Growth
3.3%
 Fifth Five Year Plan (1974-1979)
Stress was laid on employement and
Poverty alleviation
Also focuses on Self reliance in
agriculture, production and defence
Indian National Highway system was
introduce
Tourism Expanded
Target Growth 4.4% Actual Growth
 Rolling Plan (1978-1980)
Moraji Desai government rejected the
fifth five year plan
Introduced Sixth Five Year Plan
This Plan rejected by Indian Natinal
congress in 1980
New Sixth plan was made
 Sixth Five Year Plan (1980-1985)
This plan also market the beginning of
economic liberalization. Price controls were
eliminated and ration shops were closed
Increase in food prices and cost of living
Rajiv Gandhi was Prime minister during this
period
Family planning was also expanded inorder
to prevent overpopulation
Target Growth 5.2% Actual growth 5.4%
 Seventh 5 Year Plan 1985-1990
The draft of the seventh plan was approved
on November/9/1985 by the National
Development Council.
The aim was to create:
Public participation in development
Self-sufficiency in food at higher level
Efficiency, Modernization and Competition in
industry.
 Eighth 5 Year Plan 1992-1997
The draft of the eight year plan was
approved on April/1/1992 by the National
Development Council.
The aim was to create:
Human development ( creation of
employment)
Primary health facilities ( drinking water)
Increasing deficit and foreign Debt
 Ninth 5 Year Plan 1997-2002
The draft of the ninth years plan was approved by
National Development Council On February/1999.
The main aim was
Ensuring food and Nutritional security for all
Growth rate of the economy with stable prices
Empowerment of women and Society’s
Total Economy Growth Of
7,8,9 Years

6.01%

6.68 5.35
% %
 Tenth Five-Year Plan (2002-2007)

1. The plan was to double the per capita

income of India in the next 10 years
2. Its aim was to reduce the poverty ratio
15% by 2012

3. Its growth target was 8.0% but it achieved

7.2%
 Eleventh Five Year Plan (2007-
2012)
1. It was prepared by the C.Rangarajan
2. Its main theme was “ faster and more
inclusive growth”
3. Its growth rate target was 8.1% but it
achieved 7.9%
 Twelfth Five Year Plan (2012-2017)

1. Its main theme is “ faster , More Inclusive

and sustainable Growth”.
2. Its Growth rate target is 8%
3. It is current five year of India
 Causes of slow growth
 High growth rate of population

 Excessive dependence on agriculture

 Occupational structures

 Low level of technology and its poor

 Poor industrial development

 Poor development of infrastructure

facilities

 Poor rate of saving and investment

 Socio political conditions

 Planning Commission Achievements

Infrastructure developments and capacity building.

Self-sufficient in agriculture and made great progress in
capital sector goods
and consumer sector goods.
Introduced nationalisation, green revolution and aligned
with new concepts like liberalisation, privatisation and
inclusion.
Emphasised on social justice, governance, employment
 Planning Commission Problems

No structural mechanism for regular engagement with

states
Weak implementation, monitoring and evaluation
Unable to make union/states/UTs answerable for not
achieving the targets.
Ineffective forum - resolution of centre-state, inter-
ministerial issues
Failed to implement land reforms
 What is NITI Aayog?
It stands for :
National
Institution for
Transforming
India
Aayog
 Current members of NITI Aayog
Chairperson - Prime Minister Narendra
Modi
Vice Chairperson – Dr. Rajeev Kumar
Full time members – Prof. Ramesh
Chand, Mr. Vijay Kumar Saraswat and
Mr. Bibek Debroy
Chief Executive Officer – MR. Amitabh
Why Planning Commission was
replaced by NITI Aayog?
 Planning Commission

Undemocratic in nature
Efficiency in implementation of policies was
lacking behind
Adopted a top-to-bottom approach
Interfering in the financial distribution
 NITI Aayog

Democratic in nature
Implementation of policies was smooth and effective
One step towards co-operative federalism
Bottom-to-top approach
No power to grant funds or make decisions
 NITI Aayog Planning Commission

Bottom Top Approach Top Bottom Approach

No powers to disburse Have powers to disburse funds to

funds central ministries and State
Government
Tailor plans based on One size fits all
needs
Decisions taken locally Decisions taken at center
 Key Objectives of NITI Aayog

Learn Best from foreign nationals

Active involvement of states
Fostering co-operative federalism
Resolve inter-sectorial and inter-departmental issues
Long term policy framework
Monitor and evaluate the implementation of programmes
Advice and encourage partnership between
key stakeholders and like minded think
tanks
Focus on technology up gradation and
capacity building for implementation of
programmes and initiatives
Aim at village level or grass root level
Inclusion of all- Gareeb, Gaon & Kissan
Empowering Women
Sustainable Development Goals
Atal Innovation Mission – Aims to spread
entrepreneurship and innovation
among the youth of India