Planning commission of India
Encyclopedia
The Planning Commission is an institution in the Government of India
, which formulates India's
Five-Year Plans
, among other functions.
, first began in India in 1930s under the British Raj
, and the colonial government of India formally established a planning board that functioned from 1944 to 1946. Private industrialists and economist formulated at least three development plans in 1944.
After India gained independence, a formal model of planning was adopted, and the planning commission, reporting directly to the Prime Minister of India
was established. Accordingly, the Planning Commission was set up on 15 March 1950, with Prime Minister
Jawaharlal Nehru
as the chairman. Planning Commission though is a non statutory as well extra constitutional body, i.e. has been brought by an executive order.
The first Five-year Plan was launched in 1951 and two subsequent five-year plans were formulated till 1965, when there was a break because of the Indo-Pakistan Conflict. Two successive years of drought, devaluation of the currency, a general rise in prices and erosion of resources disrupted the planning process and after three Annual Plans between 1966 and 1969, the fourth Five-year plan was started in 1969.
The Eighth Plan could not take off in 1990 due to the fast changing political situation at the Centre and the years 1990-91 and 1991-92 were treated as Annual Plans. The Eighth Plan was finally launched in 1992 after the initiation of structural adjustment policies.
For the first eight Plans the emphasis was on a growing public sector with massive investments in basic and heavy industries, but since the launch of the Ninth Plan in 1997, the emphasis on the public sector has become less pronounced and the current thinking on planning in the country, in general, is that it should increasingly be of an indicative nature.
is presently the Deputy Chairman of the Commission.
Cabinet Ministers
with certain important portfolios act as part-time members of the Commission, while the full-time members are experts of various fields like Economics, Industry, Science and General Administration.
The Commission works through its various divisions, of which there are three kind:
The majority of experts in the Commission are economists
, making the Commission the biggest employer of the Indian Economic Services.
From a highly centralised planning system, the Indian economy is gradually moving towards indicative planning where the Planning Commission concerns itself with the building of a long-term strategic vision of the future and decide on priorities of nation. It works out sectoral targets and provides promotional stimulus to the economy to grow in the desired direction. It also plays an integrative role in the development of a holistic approach to the policy formulation in critical areas of human and economic development. In the social sector, schemes that require coordination and synthesis like rural health, drinking water, rural energy needs, literacy and environment protection have yet to be subjected to coordinated policy formulation. It has led to multiplicity of agencies. The commission has now been trying to formulate and integrated approach to deal with this issue.
Government of India
The Government of India, officially known as the Union Government, and also known as the Central Government, was established by the Constitution of India, and is the governing authority of the union of 28 states and seven union territories, collectively called the Republic of India...
, which formulates India's
India
India , officially the Republic of India , is a country in South Asia. It is the seventh-largest country by geographical area, the second-most populous country with over 1.2 billion people, and the most populous democracy in the world...
Five-Year Plans
Five-Year Plans of India
The economy of India is based in part on planning through its five-year plans, which are developed, executed and monitored by the Planning Commission. The tenth plan completed its term in March 2007 and the eleventh plan is currently underway...
, among other functions.
History
Rudimentary economic planning, deriving the sovereign authority of the stateSovereignty
Sovereignty is the quality of having supreme, independent authority over a geographic area, such as a territory. It can be found in a power to rule and make law that rests on a political fact for which no purely legal explanation can be provided...
, first began in India in 1930s under the British Raj
British Raj
British Raj was the British rule in the Indian subcontinent between 1858 and 1947; The term can also refer to the period of dominion...
, and the colonial government of India formally established a planning board that functioned from 1944 to 1946. Private industrialists and economist formulated at least three development plans in 1944.
After India gained independence, a formal model of planning was adopted, and the planning commission, reporting directly to the Prime Minister of India
Prime Minister of India
The Prime Minister of India , as addressed to in the Constitution of India — Prime Minister for the Union, is the chief of government, head of the Council of Ministers and the leader of the majority party in parliament...
was established. Accordingly, the Planning Commission was set up on 15 March 1950, with Prime Minister
Prime minister
A prime minister is the most senior minister of cabinet in the executive branch of government in a parliamentary system. In many systems, the prime minister selects and may dismiss other members of the cabinet, and allocates posts to members within the government. In most systems, the prime...
Jawaharlal Nehru
Jawaharlal Nehru
Jawaharlal Nehru , often referred to with the epithet of Panditji, was an Indian statesman who became the first Prime Minister of independent India and became noted for his “neutralist” policies in foreign affairs. He was also one of the principal leaders of India’s independence movement in the...
as the chairman. Planning Commission though is a non statutory as well extra constitutional body, i.e. has been brought by an executive order.
The first Five-year Plan was launched in 1951 and two subsequent five-year plans were formulated till 1965, when there was a break because of the Indo-Pakistan Conflict. Two successive years of drought, devaluation of the currency, a general rise in prices and erosion of resources disrupted the planning process and after three Annual Plans between 1966 and 1969, the fourth Five-year plan was started in 1969.
The Eighth Plan could not take off in 1990 due to the fast changing political situation at the Centre and the years 1990-91 and 1991-92 were treated as Annual Plans. The Eighth Plan was finally launched in 1992 after the initiation of structural adjustment policies.
For the first eight Plans the emphasis was on a growing public sector with massive investments in basic and heavy industries, but since the launch of the Ninth Plan in 1997, the emphasis on the public sector has become less pronounced and the current thinking on planning in the country, in general, is that it should increasingly be of an indicative nature.
Organisation
The composition of the Commission has undergone a lot of change since its inception. With the Prime Minister as the ex-officio Chairman, the committee has a nominated Deputy Chairman, who is given the rank of a full Cabinet Minister. Mr. Montek Singh AhluwaliaMontek Singh Ahluwalia
Montek Singh Ahluwalia is an Indian economist and civil servant. He is currently the Deputy Chairman of the Planning Commission of the Republic of India. He was previously the first Director of the Independent Evaluation Office at the International Monetary Fund.-Early life and education:Montek...
is presently the Deputy Chairman of the Commission.
Cabinet Ministers
Cabinet (government)
A Cabinet is a body of high ranking government officials, typically representing the executive branch. It can also sometimes be referred to as the Council of Ministers, an Executive Council, or an Executive Committee.- Overview :...
with certain important portfolios act as part-time members of the Commission, while the full-time members are experts of various fields like Economics, Industry, Science and General Administration.
The Commission works through its various divisions, of which there are three kind:
- General Planning Divisions
- Programme Administration Divisions
The majority of experts in the Commission are economists
Economics
Economics is the social science that analyzes the production, distribution, and consumption of goods and services. The term economics comes from the Ancient Greek from + , hence "rules of the house"...
, making the Commission the biggest employer of the Indian Economic Services.
Functions
The Planning Commission's functions as outlined by the Government's 1950 resolution are following:- To make an assessment of the material, capital and human resources of the country, including technical personnel, and investigate the possibilities of augmenting those resources which are found to be deficient in relation to the nation's requirement.
- To formulate a plan for the most effective and balanced utilisation of country's resources.
- To define the stages, on the basis of priority, in which the plan should be carried out and propose the allocation of resources for the due completion of each stage.
- To indicate the factors that tend to retard economic development.
- To determine the conditions which need to be established for the successful execution of the plan within the incumbent socio-political situation of the country.
- To determine the nature of the machinery required for securing the successful implementation of each stage of the plan in all its aspects.
- To appraise from time to time the progress achieved in the execution of each stage of the plan and also recommend the adjustments of policy and measures which are deemed important vis-a-vis a successful implementation of the plan.
- To make necessary recommendations from time to time regarding those things which are deemed necessary for facilitating the execution of these functions. Such recommendations can be related to the prevailing economic conditions, current policies, measures or development programmes. They can even be given out in response to some specific problems referred to the commission by the central or the state governments.
From a highly centralised planning system, the Indian economy is gradually moving towards indicative planning where the Planning Commission concerns itself with the building of a long-term strategic vision of the future and decide on priorities of nation. It works out sectoral targets and provides promotional stimulus to the economy to grow in the desired direction. It also plays an integrative role in the development of a holistic approach to the policy formulation in critical areas of human and economic development. In the social sector, schemes that require coordination and synthesis like rural health, drinking water, rural energy needs, literacy and environment protection have yet to be subjected to coordinated policy formulation. It has led to multiplicity of agencies. The commission has now been trying to formulate and integrated approach to deal with this issue.
See also
- Investment commission of IndiaInvestment commission of IndiaThe Investment commission of India is a three-member commission set up in the Ministry of Finance in December 2004 by the Government of India. Mr. Ratan Tata is Chairman and Mr. Deepak Parekh and Dr. Ashok Ganguly are members.-See also:...
- Five-Year Plans of IndiaFive-Year Plans of IndiaThe economy of India is based in part on planning through its five-year plans, which are developed, executed and monitored by the Planning Commission. The tenth plan completed its term in March 2007 and the eleventh plan is currently underway...
- Ministry of Finance, Government of IndiaMinistry of Finance (India)The Ministry of Finance is an important ministry within the Government of India. It concerns itself with taxation, financial legislation, financial institutions, capital markets, center and state finances, and the Union Budget....