UNIT-10

Topic 6- Planning & Development

Introduction

Planning refers to a deliberate and systematic process by

which the government determines priorities, allocates
resources, and sets targets to achieve specific economic
and social goals within a given time frame.

Development refers to a process of economic growth

combined with improvements in living standards,
reduction of poverty, and promotion of social justice.

Together, planning and development in India aim to

achieve growth with equity and justice.

Historical Background of Planning in India

Phase Key Developments

Pre-Independence - Visvesvaraya Plan (1934): M.
Visvesvaraya proposed “Planned Economy for
India.”
- National Planning Committee (1938): Set
up under Jawaharlal Nehru by the Indian
National Congress.
- Bombay Plan (1944): Industrialists’ plan
emphasizing state intervention.- People’s
Plan (M.N. Roy, 1945): Focused on
agriculture and social ownership.- Gandhian
Plan (S.N. Agarwal, 1944): Village-centered
and self-reliant economy.
Post- - The Planning Commission was established
Independence in 1950 by a Cabinet Resolution (not
constitutional).
- First Five-Year Plan (1951–56) initiated
the era of planned development in India.

Objectives of Planning in India

 Economic Growth: To achieve a sustained increase in
national income and per capita income through
planned development of all sectors.
 Employment Generation: To create large-scale
employment opportunities and reduce unemployment
and underemployment.
 Reduction of Inequality: To minimize economic and
social disparities among individuals, regions, and
sectors.
 Poverty Alleviation: To uplift the weaker sections of
society by providing basic needs and improving living
standards.
 Modernization: To promote technological
advancement, industrialization, and modernization of
agriculture.
 Self-Reliance: To reduce dependence on foreign aid
by strengthening domestic production and
technological capability.
 Balanced Regional Development: To ensure
uniform development of all regions and remove
regional imbalances.
 Social Justice: To ensure fair distribution of resources
and opportunities, especially for marginalized groups
(SCs, STs, OBCs, women).
 Human Resource Development: To improve
education, health, and skill development for enhancing
human capital.
 Environmental Sustainability: To promote
development without degrading natural resources and
ensure ecological balance.

Planning Commission (1950–2014)

The Planning Commission of India was established on

15 March 1950 by a resolution of the Government of
India, not by a constitutional or statutory provision.
Its main purpose was to formulate, implement, and
assess India’s Five-Year Plans for economic and social
development.
After Independence, India adopted a mixed economy
and planned development model.

The idea of economic planning was influenced by the

Soviet model and India’s National Planning
Committee (1938) headed by Jawaharlal Nehru.

The Planning Commission became the central agency

for national planning under the chairmanship of the
Prime Minister of India.

Major Functions:

 Assessment of Resources: Evaluate the country’s

material, capital, and human resources.
 Formulation of Plans: Prepare Five-Year Plans and
Annual Plans for national development.
 Policy Coordination: Determine priorities among
different sectors and allocate plan funds.
 Monitoring and Evaluation: Assess the progress and
results of development programs.
 Advisory Role: Advise the Union and State
Governments on development strategy and policy.
 Promotion of Balanced Growth: Ensure regional and
sectoral balance in development.

Criticisms:

 Centralized and Bureaucratic: Over-concentration of

power at the Centre with little state participation.
 Lack of Statutory Status: Created by executive
resolution; lacked constitutional backing.
 Inefficient Implementation: Plans often failed to
achieve stated goals due to poor execution.
 Rigid Approach: Did not adapt quickly to changing
economic realities.
 Weak Coordination: Poor coordination between Union
and State governments.
 Evolution of Five-Year Plans in India

Plan Period Major Approach / Key

Objectives / Strategy Features /
Focus Achievements
First Five- 1951–56 Agriculture, Harrod– Emphasis on
Year Plan irrigation, and Domar food
power Model; focus production,
development on primary community
sector development,
rehabilitation
of refugees
Second 1956–61 Rapid Mahalanobi Establishment
Five-Year industrializatio s Model – of steel plants,
Plan n; focus on heavy
development capital goods industries, IITs;
of heavy sector focus on public
industries sector
Third Five- 1961–66 Self-sufficiency Emphasis on Initiation of
Year Plan in food grains; both Green
expansion of agriculture Revolution;
basic and industry increase in
industries steel and coal
production
Plan 1966–69 Economic Series of Focus on
Holiday stabilization; Annual Plans restoring
tackling agricultural
drought and output and
BOP crisis macroeconomi
c balance
Fourth 1969–74 Growth with Focus on Launch of
Five-Year stability and redistribution Family Planning
Plan self-reliance and public Programme;
sector Green
expansion Revolution
continued
Fifth Five- 1974–79 Poverty Focus on Minimum
Year Plan eradication employment Needs
(Garibi Hatao) generation, Programme;
and self- agriculture, Twenty Point
reliance and defense Programme
initiated
Rolling 1978–80 Short-term Introduced Plans reviewed
Plan planning with by Janata annually and
flexibility Government modified based
on
performance
Sixth Five- 1980–85 Poverty Emphasis on Launch of
Year Plan eradication, agriculture Integrated
modernization, and Rural
technology, infrastructur Development
and self- e Programme
reliance (IRDP) and
NREP
Seventh 1985–90 Growth in food, Human Launch of
Five-Year employment, resource Jawahar Rozgar
Plan productivity, development Yojana;
and social and expansion of
justice modernizatio IT, telecom,
n and energy
Annual 1990–92 Macroeconomi Short-term Fiscal
Plans c stabilization planning consolidation
(Interim) post-crisis during and
economic groundwork for
crisis 1991 reforms
Eighth 1992–97 Human Market- Launch of LPG
Five-Year development, oriented Policy; focus on
Plan employment reforms; poverty
generation, globalization reduction and
liberalization and modernization
privatization
Ninth Five- 1997– Growth with Focus on Emphasis on
Year Plan 2002 social justice agriculture, self-
and equity rural employment,
development infrastructure,
, and and social
employment equity
Tenth Five- 2002–07 Faster and Outcome- Targets for
Year Plan more inclusive oriented poverty
growth; approach reduction,
doubling per with literacy, and
capita income measurable employment
targets generation
Eleventh 2007–12 Inclusive Focus on Implementation
Five-Year growth; human of NRHM, RTE
Plan reducing development Act, and
inequality and , education, expansion of
regional and health higher
disparity education
Twelfth 2012–17 Faster, Emphasis on Focus on
Five-Year sustainable, manufacturin infrastructure
Plan and more g, energy, investment,
inclusive and employment,
growth environment and skill
al development
sustainability
Post–Plan After Policy-based Replaced by Shift toward
Era 2017 planning; no NITI Aayog cooperative
formal Five- (2015) and federalism,
Year Plans Three-Year outcome-based
Action planning, and
Agenda vision
(2017–20) documents

NITI Aayog (National Institution for

Transforming India)

The NITI Aayog was established on 1 January 2015 by

the Government of India, replacing the Planning
Commission (1950–2014).
It serves as a policy think-tank that aims to promote
cooperative federalism, bottom-up planning, and
sustainable development in partnership with states and
Union Territories.
Objectives of NITI Aayog:

 Foster Cooperative Federalism: Promote

coordination between the Centre and States through
structured support and policy dialogue.
 Bottom-up Planning: Encourage participation of local
governments and grassroots-level institutions in the
planning process.
 Strategic Policy Formulation: Provide long-term
vision, policy direction, and mid-term strategies for
development.
 Innovation and Knowledge Hub: Serve as a think-
tank to promote innovation, technology, and best
practices across sectors.
 Monitoring and Evaluation: Evaluate
implementation of government programs and assess
their outcomes.
 Sustainable and Inclusive Development: Ensure
that growth benefits all sections of society while
maintaining environmental sustainability.
Structure of the NITI Aayog
 Chairperson: The Prime Minister of India is the ex-
officio chairperson.
 Vice-Chairperson: Appointed by the Prime Minister,
they hold a rank equivalent to a Union Cabinet
Minister.

 Full-time Members: Experts from various domains

like economics, science, and other relevant fields.
 Part-time Members: A maximum of two part-time
members are appointed on a rotational basis from
leading research institutions and universities.
 Ex-Officio Members: Up to four Union Ministers can
be nominated by the Prime Minister to serve in this
capacity.
 Chief Executive Officer (CEO): A high-ranking IAS
officer appointed by the Prime Minister for a fixed
term. They head the day-to-day operations.
 Governing Council: This apex body consists of the
Chief Ministers of all states and the Lieutenant
Governors of Union Territories. It ensures state-level
involvement in policymaking and is known as "Team
India".
 Regional Councils: Formed to address specific issues
affecting multiple states within a particular
 region. These are chaired by the Prime Minister or his
nominee.
 Special Invitees: Eminent experts, specialists, and
practitioners from various fields are nominated by the
Prime Minister to contribute to specific discussions.

Difference between Planning Commission and

NITI Aayog

Aspect Planning NITI Aayog

Commission
Established 1950 2015
Type Centralized Policy think-tank
planning body
Approach Top-down Bottom-up
Role of States Advisory / Active participation through
Limited cooperative federalism
Focus Formulation of Long-term strategic and
Five-Year Plans innovation-based planning
Fund Allocation Had financial No direct fund allocation
Power powers power

Types of Planning in India

Type Description
Indicative Planning Non-binding targets; relies on market forces
(used post-liberalization).
Perspective Long-term planning (15–20 years).
Planning
Annual Plans Bridge between Five-Year Plans.
Rolling Plans Flexible yearly plans (introduced 1978–80).
Decentralized Local-level participation through PRIs and
Planning municipalities (post-73rd/74th
Amendments).

Development: Meaning and Dimensions

 Economic Development: Growth in income, industry,
infrastructure.
Social Development: Education, health, gender equality.
Political Development: Democratic participation,
responsive institutions.
Sustainable Development: Balance between economic
growth and environmental protection.

Major Development Programmes in India

Sector Programme Key Features

Rural Employment MGNREGA (2005) 100 days of guaranteed
employment
Poverty Alleviation PMAY-G, NRLM Housing and livelihood
support
Health National Health Access to health
Mission (NHM) services
Education Sarva Shiksha Universal elementary
Abhiyan, NEP 2020 education
Agriculture PM-KISAN, Soil Farmer welfare
Health Card, Fasal
Bima Yojana
Digital Digital India, Technology-driven
Development Startup India growth
Infrastructure PM Gati Shakti, Modern infrastructure
Smart Cities planning
Mission

Challenges in Planning and Development

 Regional disparities between states.

 Poverty and unemployment persistence.
 Environmental degradation.
 Implementation bottlenecks and corruption.
 Centralized decision-making despite
decentralization rhetoric.
 Data inadequacy and poor monitoring.
 Social inequalities and exclusion of marginalized
groups.
Key Takeaways
 Planning and development in India represent a blend of
state-led initiatives and market-driven growth.
 The shift from Planning Commission to NITI Aayog
marks a move towards participatory, decentralized, and
evidence-based planning.
 True development must balance economic growth,
social justice, and environmental sustainability,
ensuring that progress reaches every citizen at the
grassroots.
 The structure of NITI Aayog includes a Chairperson
(the Prime Minister), a Vice-Chairperson appointed by
the PM, a Chief Executive Officer (CEO) who manages
daily operations, and full-time and part-time members
who are experts in their fields.
 The first Five-year Plan was launched in 1951 and
subsequent Five-year plans were formulated till 1965
when a gap occurred due to the war with Pakistan.
 The 8th Plan could not be launched in 1990 due to
political situations altering and instabilities at the
Centre and the years 1990-91 and 1991-92 received
Annual Plans.