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Indian Economy

Five-Year Plan: Economic Planning in India.

Hello aspirants, Five-year plans: Economic Planning in India is the most important topic in the Indian Economy as from this topic many questions are being asked every year.

Hello aspirants, Five-year plans: Economic Planning in India is the most important topic in the Indian Economy as from this topic many questions are being asked every year.

In this Indian Economy notes series, we are going to share a short but important note on Five-year plans: Economic Planning in India which will be helpful for aspirants who are preparing for Government jobs such as SSC CGL, SSC CHSL, JPSC, JSSC, etc.

This note on Five-year plans: Economic Planning in India we are going to cover the following topics-

Planning Commission 

  • In 1938 National Planning Committee (NPC) was set up under JL Nehru as its chairman.
  • Later the Government of India set up Planning Commission on 15 March 1950.
  • Montek Sing Ahluwalia was the last deputy chairman of the Planning Commission.

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National Development Council (NDC)

  • National Development Council was set up on 6 August 1952.
  • Functions of National Development Council:
    1. It evaluates the management of plans,
    2. It analyses the policies affecting the development
    3. It gives final approval to the Five-year plan.
  • Structure of National Development Council:
    1. Chairman: PM of India (Ex-officio Chairman)
    2. Secretary of planning commission as the ex-officio secretary.

Strategies of Planning

First five-year plan (1951-56)

  • Based on “Harrod-Domar” Model
  • Emphasis: Agriculture, Irrigation and Electricity.
  • Achievements/Works:
    1. Bhakra Nangal Dam,
    2. Hirakund Dam,
    3. Damodar valley project.
  • Target growth rate: 2.1%; Achieved: 3.6%

Second Five-year plan (1956-1961)

  • Based on the “Nehru-Mahalanobis” model.
  • Emphasis: Industrial development, Medical and Health.
  • Achievements/Works
    1. Durgapur steel plant established with the help of the UK, Bhilai steel plant (USSR), Rourkela steel plant (Germany).
    2. Integral coach factory and Chittranjan locomotives established,
    3. Atomic energy commission becomes operational.
  • Target growth rate – 4.5%, Achieved: 4.2%

Third Five-year plan (1961-1966)

  • Based on the “Sandy-Chakraborty” model.
  • This plan is also known as ‘Gadgil Yojana’, after the Deputy Chairman of Planning Commission D.R. Gadgil.
  • Emphasis: Self-reliant, Industrial and agricultural development.
  • Target: 5.6%; achieved: 2.6% making it the most un-successive plan.
  • Reason: Indo-China war 19652, Indo-Pak war 1965, and Drought 1966.
  • Achievements/Works: 
    1. Bokaro steel plant 1964, 
    2. Unit Trust of India 1964,
    3. IDBI Bank 1964,
    4. FCI 1965,
    5. Agriculture Pricing Commission (APC) 1965, was established.

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Annual plan (Plan Holiday) 1966-1969

  • The government declared devaluation of the Rupee to increase the exports.

Fourth Five-year plan 1969-74

  • Based on the “Ashok, Rudra and Allen” model.
  • Emphasis: growth with stability and self-reliance.
  • Achievements/Works: 
    1. Nationalisation of 14 banks,
    2. “Garibi Hatao” slogan
    3. Family Planning Programmes
    4. Drought Prone Area Programme (DPAP) 1973-74,
    5. The green revolution started. (MS Swaminathan is known as the “Father of Green Revolution” in India)

Note: Pokhran test (smiling Buddha) conducted successfully.

Fifth Five-year plan 1974-78

  • Based on the “DP Dhar model”.
  • Emphasis: Employment generation, Justice, Agriculture and Defence.
  • Achievements/work: 
    1. The Electricity Supply Amendment Act 1975,
    2. Twenty-point program 1975, 
    3. The Minimum Needs Programme (MNP) and 
    4. the Indian National Highway System was introduced,
    5. Regional rural banks established,
    6. Antodaya Yojana started.
  • Note:
  • This plan was operational for 4 years only. The last year i.e, the fifth year is known as the “Rolling Plan”.
  • Rolling Plan 1978-79: The rolling plan was launched by the Morarji Desai government.

Sixth Five-year plan 1980-85

  • Emphasis: economic liberalization, poverty eradication and self-reliance.
  • Achievements/Work: 
    1. 6 more banks nationalised,
    2. NABARD 1982,
    3. EXIM Bank 1982
    4. TRYSEM, IRDP, RLEGP, NREP were started.

Seventh Five-year plan 1985-90

  • PM/Chairman- Rajiv Gandhi
  • Emphasis: 
    1. “Growth, modernisation, self-reliance and social justice”
    2. Up-gradation of technology, employment creation,
    3. Focus on “food, work & productivity”.
    4. For the first time in India, the private sector got priority over the government sector.
  • Achievements/Work: 
    1. Jawahar Rojgar Yojana
    2. Speed Post, 1986
    3. SEBI 1988

Annual Plan 1990-92

  • 1990 SIDBI established
  • 1991 Economic Reform (LPG) took place.

Eighth Five year Plan 1992-97

  • PM/Chairman – PV Narshimha Rao.
  • Based on John W. and Miller model
  • Emphasis:
    1. Co-operative federalism,
    2. Agriculture and other rural activities.
    3. Human Resource Development.
  • Achievements/Work:
    1. New Economic Policy was adopted
    2. India became a member of WTO in 1995
    3. “PM Rojgar Yojna” started.

Ninth Five-year plan 1997-2002

  • PM Atal Bihari Vajpayee.
  • The ninth Five-year plan was launched in the 50th year of independence of India.
  • Emphasis: “Growth with Social Justice and Equality”
  • Achievements/Work:
    1. Focus on Basic Minimum Services (BMS)

Tenth five-year plan 2002-07

  • Emphasis: 
    1. The agricultural sector declared as the Prime moving Force (PMF) of the economy.
    2. Doubling the per capita income in 10 years.
    3. Reducing the poverty rate to 15% by 2012.
    4. Achieving Literacy rate to 75% by 2007.

Eleventh Five-year Plan 2007-12

  • Emphasis: “Inclusive growth”
  • This plan was formulated by “C. Rangarajan”.
    1. Achievements: During this plan, the country achieved the highest growth of 8% among all five-year plans.

Twelfth Five-year plan 2012-2017

  • Emphasis: “Faster, sustainable and more inclusive growth”
  • Target Growth rate – 8%

NITI Aayog

Five-year-plan-in-India.
  • National Institute for Transforming India Aayog came into existence on Jan 1 2015.
  • NITI Aayog replaces Planning Commission and aims to involve State governments in economic policy making.
  • NITI Aayog provides strategic and technical advice to the Central and State governments.

Structure of NITI Aayog

  • NITI Aayog will be headed by PM and will have a Governing Council, comprising of CM of states and Heads of all UT’s.
  • The Governing Council will replace the NDC (National Development Council)
  • Members of NITI Aayog:
    1. Chairman – Narendra Modi (PM)
    2. Vice-Chairman – Rajiv Kumar
    3. Chief Executive Officer – Amitabh Kant.

Read more about NITI Aayog

In this post, we have shared exam relevant information about Five-year-plan-Economic-Planning-in-India. This will be helpful for those students who are aspiring for JPSC, JSSC, or other Government job preparation.

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