The long-term policies and plans of the government, which develops the economy through the utilization of resources are widely known as Economic Planning. These policies started in the year 1950. During that period, development and growth were two most significant and necessary goals as India had just attained Independence from the British Raj and it had a lot to prove. Furthermore, it also had the gigantic responsibility to cure the centuries of mutilation and brutality the Raj had incurred on the economy, society and polity of the country.   This planning was carried out by the Planning Commission. 

The process of Economic planning involves preparing the list of issues faced by an economy, identification of the issue, fixing a goal that needs to be achieved, estimating the resources needed for the goals to be achieved. Here, mobilizing the resources to be used is very crucial. Once all the processes of economic planning are organized and mobilized, the execution process starts in order to achieve the goal. In order to make sure that the execution and processes are run smoothly without errors; periodic reviews are conducted. 

Let us look at the objectives of the Indian economic planning. 

Objectives

Some of the major objectives of Indian Economic Planning- 

  • Economic stability and Development
  • Increase in the employment level and living standards
  • Self- sufficient economy
  • Regional Development
  • Sustainable development
  • Social Justice and Social Welfare
  • Population control

The first Prime Minister of India- Jawaharlal Nehru- adopted the idea of five-year economic planning, under the influence of Socialism and the Soviet Union. 

Five Year Plan

The initial five-year plan primarily focused on public sector expansion. This was done through huge and bulky investments in several basic and heavy sectors of the economy. However, after the eighth five-year plan, that is, from the ninth five-year plan the aim of the planning commission shifted to the government sector being a growth facilitator. 

The long-term objective of the five-year plan includes-

  • Raising the living standard of the Citizens
  • Self-sufficient economy
  • Modernized economy
  • Reducing inequality in several economic aspects
  • Promoting social welfare and justice in the society
  • Economic stability and development
  • High Growth rate in the economy

As we have briefed upon the objectives of the five-year plan, let us move ahead with some facts about these plans. There are several interesting and important facts about the five-year plan in India. These include-

  1. In between the third five-year plan and the fourth five-year plan, a total of three annual reports were introduced. This was known as the Plan Holiday in the Indian Polity system. This step was taken by the government as a response to the setback or failure of the previous plans. 
  2. After the Emergency period in the country, a Rolling plan was introduced and implemented, instead of the regular plans by the Janata Party. 
  3. In the year 1980, Indira Gandhi implemented her own sixth five-year plan, abandoning the previous and related “sixth five-year plan” or the rolling plan of 1978-79. 
  4. The eighth five-year plan was implemented after a break of two years- giving time to the economy to settle down. For these two years, that is 1990-92, a total of two annual plans were implemented by the government. 

Planning Commission

The government body which had the responsibility of the implementation and formulation of the five-year plans in the economy was widely known as the Planning Commission. The commission had the authority to report to the Prime Minister of the country- directly without any interference from other bodies of government. The Planning Commission was founded in the year 1950, under the government of Prime Minister Jawaharlal Nehru in India. This body was not founded on the provisions of the Constitution of India. However, this body started to function in April 1951. 

The objective of the planning Commission was similar to that of five-year plans. This includes- a rise in living standards, a high growth rate, and opportunities for the people to get involved in several services and work of the society. For a country like India, which dwells in the river of diversity, the centralized approach of the planning commission and the five-year plan was found to be quite irrelevant. The NDA Government, after a few years, abolished the Planning Commission. The planning commission was then put back by the NITI Aayog. Hence, no thirteen five-year plan was put forward. The NITI Aayog documents are just considered as the government policy guide structure. It can also be said as the successor of the Planning Commission in the Indian Economy. 

Conclusion

The long-term policies and plans of the government, which develops the economy through the utilization of resources are widely known as Economic Planning. The process of Economic planning involves preparing the list of issues faced by an economy, identification of the issue, fixing a goal that needs to be achieved, estimating the resources needed for the goals to be achieved. The initial five-year plan primarily focused on public sector expansion. This was done through huge and bulky investments in several basic and heavy sectors of the economy. The government body which had the responsibility of the implementation and formulation of the five-year plans in the economy was widely known as the Planning Commission. The objective of the planning Commission was similar to the objectives of the five-year plans. NITI Aayog is the successor of the Planning Commission in the Indian Economy.