Economic Planning of India



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Economic Planning of India :



The progress and happiness of an individual’s life depends upon the way in the individual lives. If he is careless and spend thrift his life will be a miserable one. If he lives systematically that is planning his life according to his income than there will be happiness and contentment. The same rule will hold good to the nation also.

Planning may be defined as a consciously directed process to achieve certain predetermined goals under the constraint of available means. The declared goals of Indian development policy are…

i) Rapid increase in living standard

ii) To provide full employment at adequate wages

iii) To reduce inequalities arising from the uneven distribution of income and wealth

The basic objective of India’s economic development is to provide the masses of Indian people the opportunity to lead a good life. Economic planning is not a new thing to India. The process of economic planning in India was initiated by Sir M. Visweswaraya in 1934 through his book – Planned Economy of India. His motto is - Industrialise or Perish. The National Planning Committee chaired by Nehru was set up by the Indian National Congress in 1938. After independence the planning commission was set up in 1950 under the chairmanship of Jawaharlal Nehru. P.C. Mahalanobis played a major role. He was a great economist and statistician. He contributed to laying foundation of India’s statistical system and economic planning.

India’s two major problems namely food and refugee problems also forced the rulers to do something to eradicate these problems. Russia at that time had been developing rapidly by its economic planning. Nehru witnessed the progress and development of Russia. So the result was the commencement of the First Five Year Plan on April 1 - 1951. India ushered and in the era of economic planning.

At the time of commencement of the First Plan (1951 - 56), India was suffering from the problem refugee-influx, food shortage and rising prices. The country had yet to recover from the disturbances created in the economy by the Second World War. So the main objectives of the First Plan were rehabilitation of refugees, rapid agricultural development through land reforms and community development programmes. A number of multipurpose projects were constructed. The final total of the first plan was Rs.2068 – 78 crores. The second five-year plans gave 1956-61 importance to both agriculture and industry. So a number of big industrial firms were started, for example Iron and steel, fertilizers, chemical, HMT and ITI were opened. The emphasis was given to basic and heavy industries. A target of Rs.4800 crore was the developmental outlay of the central and state governments.

The Third Five Year Plan (1961 - 66) - Rs.8577 crores : The basic goal of the Third Plan was to make India a self-reliant and self-generating economy. But the plan came across certain unforeseen misfortunes which prevented its success. The wars with China and Pakistan changed the national priorities.

The Fourth Five Plan (1969-74) : The planned expenditure of the plan was fixed at Rs. 15,902 crore. The twin objectives of the Fourth Plan were growth with stability and maximum self-reliance. Self-sufficiency in food and reduction in external assistance, increase in employment and national income were other two objectives or the Fourth Plan.

The Planning commission released in New Delhi its draft approach paper on Tenth Five Year Plan (2002 - 2007). It proposed a target of 8 percent Gross Domestic product growth for the period.

In spite of ten Five year plans and spending millions of crore rupees, the conditions in rural areas are pathetic. Thousands of our villages have no water and not even mud roads, let alone primary health centres. There is still poverty, illiteracy and ignorance.

It is a great mystery. Isn’t it?

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