economics project - copy

8/10/2019 Economics Project - Copy

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Economic Planning in IndiaAn analysis

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Economic Planning in India-An analysisProject submitted to

Miss Eritriya Roy

(Faculty: Economics)

Project Submitted by

Vinay Kumar Sahu

(Sociology,Major)

Semester Three

Roll No - 169

HIDAYATULLAH NATIONAL LAW UNIVERSITY

RAIPUR, C.G.


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ACKNOWLEDGEMENTS

I am highly elated to carry out my research on this topic, Economic Planning in IndiaAnanalysis. I would like to give my deepest regard to my course teacher Ms. Eritriya Roy,who held me with his immense advice, direction and valuable assistance, which enabled meto march ahead with this topic. I thank my parents, who gave me moral and mental support. Iwould like to thank my friends, who gave me their precious time for guidance and helped mea lot in completing my project by giving their helpful suggestion and assistance. I would likethanks to my seniors for their valuable support. I would also like to thank the library staffand computer lab staff of my university for their valuable support and kind cooperation.

VINAY KUMAR SAHU

ROLL NO.-169

SEMESTER-3


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Table of Contents

Research methodology ....................................................................................................04

Objectives .........................................................................................................................04

Introduction .....................................................................................................................05

History ...................................................................................................................05

Planning Commission of India.............................................................................06

National Development Council of India .............................................................06

State Planning Board ...........................................................................................07

Objectives of Planning .........................................................................................07

First five year plan(1951-1956) ............................................................................07

Second five year plan(1956-1961) ........................................................................08

Third five year plan(1961-1966) ..........................................................................10

Three annual plans(1966-1969) ...........................................................................10

Fourth five year plan(1969-1974) .......................................................................11

Fifth five year plan(1974-1979) ...........................................................................11

Rolling plan(1978-1980) .......................................................................................12

Sixth five year plan(1980-1985) ...........................................................................12

Seventh five year plan(1985-1990) ......................................................................14

Eighth five year plan(1992-1997) ........................................................................16

Ninth five year plan(1997-2002) ..........................................................................17

Tenth five year plan(2002-2007) ..........................................................................19

Eleventh five year plan(2007-2012) .....................................................................21

Twelfth five year plan(2012-2017) .......................................................................23

Conclusion .............................................................................................................25

Bibliography ..........................................................................................................26


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RESEARCH METHODOLOGY

The researcher has followed the non doctrinal method for research design. The research is

based on both primary and secondary sources. Literature review has been done extensively in

order to make a comprehensive presentation. Books from the universitys library have been

used. Computer from the computer laboratory of the university has been used for the purpose

of secondary research and is the main source of project.

OBJECTIVES

To analyse the five years of economic planning in India.

To discuss about their objectives ,targets ,and achievements.


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Introduction

For the smooth functioning of any economy, planning plays an important role.

The Planning Commission has been entrusted with the responsibility of the creation,

development and execution of India's five year plans.India's five year plans are alsosupervised by the Planning commission.The economy of India is based in part on planning

through its five-year plans, developed, executed and monitored by the Planning Commission.

With the Prime Minister as the ex officio Chairman, the commission has a nominated Deputy

Chairman, who has rank of a Cabinet minister. Montek Singh Ahluwalia is currently the

Deputy Chairman of the Commission. The tenth plan completed its term in March 2007 and

the eleventh plan is currently underway.The tenth plan completed its term in March 2007 and

the eleventh plan is currently underway. As Indias government prepares to submit itsapproach paper for its 12th five-year plan (a plan which covers years 2012 to 2017).

History of planning in India

First attempt to initiate economic planning in India was made by Sir M.Visvesvarayya ,a

noted engineer and politician ,in 1934 through his book , planned economy for india .In

1938 National Planning Commission was set up under the chairmanship of Jawaharlal

Nehru by the Indian National Congress. Its recommendation could not be implemented

because of the beginning of the second world war and changes in the Indian Political

Situation.

In 1944 , Bombay Plan was presented by 8 leading industrialists of Bombay.

The Bombay Plan is the name commonly given to aWorld War II-era set of proposals

for the development of the post-independenceeconomy of India.The plan, published

in 1944/1945 by eight leadingIndian industrialists, proposed state intervention in the

economic development of thenation after independence from theUnited

Kingdom (which occurred in 1947).Although the Bombay Plan did not itself propose

a socialist agenda, "virtually all" commentators acknowledge "that there is a direct

line of continuity from the Bombay Plan of 1944-1945 to the First Five-Year Plan in

1950.

In 1944 , Gandhian Planwas given by S.N.Agrawal.

In 1945, Peoples Planwas given by M N Roy.
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In 1950, Sarvodaya Plan was given by J P Narayan. A few points of this plan were

accepted by the Government.

The Planning Commission of India

The Planning Commission was setup on March 15, 1950 under the chairmanship of

JL Nehru, by a resolution of Union Cabinet.

It is an extraconstitutional, nonstatutory body.

It consists of Prime Minister as the ex officio Chairman, one Deputy Chairman

appointed by the PM and some full time members.

The tenure of its members and deputy chairman is not fixed. There is no definite

definition of its members also. They are appointed by the Government on its owndiscretion. The number of members can also change according to the wishes of the

Government.

Functions

Assessment of material, capital and human resources of the country.

Formulation of plans for the most effective and balanced utilization of countrys

resources.

To determine the various stages of planning and to propose the allocation of resources

on the priority basis.

To act as an advisory body to the Union Government.

To evaluate from time to time the progress achieved in every stage of the plan and

also to suggest remedial measures.

To advise the Centre and the State Governments from time to time on special matters

referred to the Commission.

National Development Council in India

All the plans made by the Planning Commission have to be approved by National

Development Council first. It was constituted to build co operation between

theStates and the Planning Commission for economic planning.

It is an extraconstitutional and extralegal body.
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It was setup on August 6, 1952, by a proposal of the Government. The PM is the ex

officio chairman of NDC. Other members are Union Cabinet Ministers, Chief

Ministers and Finance Ministers of all States, Lt. Governors of Union Territories and

Governors of Centrallyruled States.

State Planning Board in India

Apex planning body at State level is generally a State Planning Body comprising the

Chief Minister as Chairman, Finance and Planning Ministers of that State and some

technical experts.

District Planning Committee is also there comprising both official and non official

members.

Objectives of Planning

Increase in National Income (NI) and Per Capita Income (PCI) ,Full Employment ,Poverty

Eradication via rapid economic growth ,reduction of inequalities of income and wealth

,socialistic pattern of society and absence of exploitation ,reduction in regional inequalities

,and attaining selfreliance.

First Five-Year Plan (19511956)

The first Indian Prime Minister, Jawaharlal Nehru presented the first five-year plan to the

Parliament of India on December 8, 1951.This plan was based on the Harrod-Domar model.

The plan addressed, mainly, the agrarian sector, including investments in dams and irrigation.

The agricultural sector was hit hardest by thepartition of India and needed urgent attention.The total planned budget of 2069 crore was allocated to seven broad areas: irrigation and

energy (27.2 percent), agriculture and community development (17.4 percent), transport and

communications (24 percent), industry (8.4 percent), social services (16.64 percent), land

rehabilitation (4.1 percent), and for other sectors and services (2.5 percent). The most

important feature of this phase was active role of state in all economic sectors. Such a role

was justified at that time because immediately after independence, India was facing basic

problemsdeficiency of capital and low capacity to save.Community development program

was launched in 1952.
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The target growth rate was 2.1% annualgross domestic product (GDP) growth; the achieved

growth rate was 3.6% The net domestic product went up by 15%. The monsoon was good

and there were relatively high crop yields, boosting exchange reserves and the per capita

income,which increased by 8%. National income increased more than the per capita income

due to rapid population growth. Many irrigation projects were initiated during this period,

including the Bhakra Dam and Hirakud Dam. The World Health Organization, with the

Indian government, addressed children's health and reduced infant mortality, indirectly

contributing to population growth.

At the end of the plan period in 1956, fiveIndian Institutes of Technology (IITs) were started

as major technical institutions. TheUniversity Grant Commission was set up to take care of

funding and take measures to strengthen the higher education in the country. Contracts were

signed to start five steel plants, which came into existence in the middle of the second five-

year plan.The main objectives of first five year plan was -

1.To correct the disequilibrium in the economy caused by 3 main problems -

a).influx of refugees .

b).Severe food shortage.

c).Mounting inflation.

2).To initiate a process of all round balanced development to ensure a rising national income

and a steady improvement in living standards.

3).It emphasized on agriculture ,price stability ,power and transport .

The plan was successful .Target Growth: 2.1% Actual Growth: 3.6%

Second Five-Year Plan (19561961)

The second five-year plan focused on industry, especially heavy industry. Unlike the First

plan, which focused mainly on agriculture, domestic production of industrial products was

encouraged in the Second plan, particularly in the development of thepublic sector.The plan
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followed theMahalanobis model,aneconomic development model developed by the Indian

statistician ,Prasanta Chandra Mahalanobis in 1953. The plan attempted to determine the

optimal allocation of investment between productive sectors in order to maximise long-run

economic growth . It used the prevalent state of art techniques of operations research and

optimization as well as the novel applications of statistical models developed at the Indian

Statistical Institute.The plan assumed a closed economy in which the main trading activity

would be centered on importing capital goods. 1 Its emphasis was on economic stability

.Agriculture target fixed in the first plan was almost achieved .Consequently the agriculture

sector got low priority in the second five year plan.Its objective was

1).Rapid Industrialisation ,particularly basic and heavy industries such as iron and steel

,heavy chemicals like nitrogeneous fertilizers ,heavy engineering and machine building

industry.

2).Besides ,the industrial policy of 1956 emphasized the role of public sector and accepted

the establishment of a socialistic pattern of society as the goal of economic policy.2

It advocated huge imports which led to emptying of funds leading to foreign loans.It shifted

basic emphasis from agriculture to industry far too soon. During this plan price level

increased by 30% ,against the decline of 13% during the first plan. Hydroelectric power

projects and five steel mills at Bhilai, Durgapur, and Rourkela were established. Coal

production was increased. More railway lines were added in the north east.The Atomic

Energy Commission was formed in 1958 with Homi J. Bhabha as the first chairman. The

Tata Institute of Fundamental Research was established as a research institute. In 1957 a

talent search and scholarship program was begun to find talented young students to train for

work in nuclear power.

The total amount allocated under the second five year plan in India was Rs. 4,600 crore. This

amount was allocated among various sectors:

Power and irrigation

Social services

1Jalal Alamgir, India's Open-Economy Policy: Globalism, Rivalry, Continuity (London and New York: Routledge

2008), Chapter 22Baldev Raj Nayar, Globalization And Nationalism: The Changing Balance Of India's Economic Policy, 1950

2000
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Communications and transport

Miscellaneous

Target Growth:4.5% Growth achieved:4.0%

Third Five-Year Plan (19611966)

The third plan stressed on agriculture and improvement in the production of wheat, but the

brief Sino-Indian War of 1962 exposed weaknesses in the economy and shifted the focus

towards the [Defence industry]. In 19651966, India fought a [Indo-Pak] War with Pakistan.

Due to this there was a severe drought in 1965. The war led to inflation and the priority was

shifted toprice stabilisation.The construction ofdams continued. Manycement andfertilizer

plants were also built.Punjabbegan producing an abundance ofwheat.

Manyprimary schools have been started in rural areas. In an effort to bring democracy to the

grassroot level, Panchayat elections have been started and the states have been given more

development responsibilities.

State electricity boards and state secondary education boards were formed. States were made

responsible for secondary andhigher education.State road transportation corporations were

formed and local road building became a state responsibility. The main aim of this plan

period was to make india a self reliant and self generating economy.The objective of the

plan included the expansion of basic industries ,optimum utilization of countrys labour

power and reducing the inequalities of income and wealth.This plan relied heavily on foreign

aid. Prices increased by 36% in 5 years. Hence 3 rdplan failed in every respect.

Target Growth: 5.6% Actual Growth: 2.4% .

Three annual plans (1966-69)

Plan holiday for 3 years .

The prevailing crisis in agriculture and serious food shortage necessitated the

emphasis on agriculture during the annual plans.
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b).Attainment of self reliance, through promotion of high rate of growth ,better distribution of

income and a very significant growth in the domestic rate of savings.

In this plan period National Program of Minimum Needs was initiated in which primary

education ,drinking water ,medical facilities in rural areas ,nourishing food ,land for the

houses of landless labours ,rural roads , electrification of the villages and cleanliness of the

dirty suburbs were included.Stress was by laid on employment,poverty alleviation, and

justice.The plan also focused onself-reliance in agricultural production and defence. In 1978

the newly elected Morarji Desai government rejected the plan. Electricity Supply Act was

enacted in 1975, which enabled the Central Government to enter into power generation and

transmission.

The Indian national highway system was introduced and many roads were widened to

accommodate the increasingtraffic.Tourism also expanded.

Target Growth: 4.4% Actual Growth: 5.0.

Rolling Plan(19781980)

There were two sixth plansOne by janata govt. (for 1978-1983) which was in operation for

2 years only and the other by the congress govt. When it returned to power in 1980.The

Janata govt. Plan is also called Rolling Plan.The focus of the plan was enlargement of the

employment potential in agriculture and allied activities, encouragement to household and

small industries producing consumer goods for consumption and to raise the incomes of the

lowest income classes through minimum needs program .

Sixth Five-Year Plan (19801985)

6th Five Year Plan is also referred to as the Janata Government Plan and it was revolutionary

since it marked a change from the Nehruvian model of Five Year Plans. The sixth five year

plan has changed a lot of things in India. On one hand it had improved the tourism industry in

India and on the other hand it aimed at development in the Information Technology sector.

When Rajiv Gandhi was elected as the prime minister, the young prime minister aimed for

rapid industrial development, especially in the area of information technology. Progress was
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slow, however, partly because of caution on the part of labour and communist leaders.The

Indian national highway system was introduced for the first time and many roads were

widened to accommodate the increasing traffic. Tourism also expanded.The sixth plan also

marked the beginning of economic liberalization.Price controls were eliminated and ration

shops were closed. This led to an increase in food prices and an increase in thecost of living.

This was the end ofNehruvian Plan andRajiv Gandhi was prime minister during this period.

Issues within the 6th Five Year Plan

The 6th Five Year Plan started from 1980 and covered a timespan of another five years that is

till 1985. During this time the Prime Minister was Rajiv Gandhi and hence industrial

development was the emphasis of this plan. His idea about the betterment of the industrial

sector was welcomed by some and opposed by lot others specially the communist groups.

Even the workers who were more inclined towards the leftist ideology were not much

convinced. This slowed down the pace of progress.

Transport and Communication System

The transport and communication system also improved under this Plan. The National

Highways were all built during this time . Apart from the construction of new highways, the

condition of the roads were meliorated. This helped in the betterment of the traffic system inIndia. During this time the Indian currency was devalued and this led to a dramatic increase

in the number of foreign travelers in India thus helping India to become a tourist destination.

New Introduction on the Economic Front

Economic Liberalization was introduced for the first time in India during this period. Ration

shops were closed because government no more produced articles at a subsidized rate. Price

control measures were no more useful. As a consequence the prices of various goods

increased leading to growth in the standard of living of the residents of India.

Measures against Population Explosion

Family Planning was implemented for the first time in India . Family Planning helped to

create awareness among the Indians regarding population. However, this measure to control

population was not accepted across India. It was readily accepted by the people residing in

the developed areas of the country but the mass of the less developed areas refused to accept

the plan and never implemented it.Family planning was also expanded in order to prevent
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overpopulation. In contrast to China's strict and binding one-child policy, Indian policy did

not rely on the threat of force. More prosperous areas of India adopted family planning more

rapidly than less prosperous areas, which continued to have a highbirth rate.The objective of

sixth five year plan was Increase in National Income ,modernization of technology ,ensuring

continuous decrease in poverty and unemployment ,population control through family

planning.

Target Growth: 5.2% Actual Growth: 5.4%.

Seventh Five-Year Plan (19851990)

The seventh 7th Five Year Plan emphasized policies and programs which aimed at rapid

growth in food-grains production ,increased employment oppurtunities and productivity

within the framework of basic tenants of planning This Five Year Plan was the come back

vehicle of the Indian National Congress Party into power. The primary aim of the five year

plan was to upgrade the industrial sector and enable India to establish itself as one of the

developed countries of the world. This Plan was released under the National Development

Council of India.The objective of the 7th Five Year Plan was to generate more scope of

employment for the people of India, to produce more in terms of food which would lead to an

overall increase in productivity. The plan laid stress on improving the productivity level of

industries by upgrading of technology.

The main objectives of the 7th five year plans were to establish growth in areas of increasing

economic productivity, production of food grains, and generating employment.

As an outcome of the sixth five year plan, there had been steady growth in agriculture,

control on rate of Inflation, and favourable balance of payments which had provided a strong

base for the seventh five Year plan to build on the need for further economic growth. The 7th

Plan had strived towards socialism and energy production at large.

Backdrop of the 7th Five Year Plan

The 7th Five Year Plan started off on a string ground since the foundation for economic

development was laid by the 6th Five Year Plan. The Sixth Five Year Plan had already paved

the way for economic development by increasing the production in the agricultural and

industrial sector, curbing the rate of inflation and maintaining a balance in the transaction of
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goods, services and money. Therefore, the 7th Five Year Plan had a strong base on which it

could built the superstructure of industrial development for the betterment of India's

economic position. This plan strove to achieve socialism and expand the production of

energy.

Contents of the 7th Five Year Plan

The basic issues on which this plan put stress were:

Introduction and application of modern technology

Justice meted out to people from various social stratas

Improving the position of the weak in the Indian society

Development of agriculture

Reducing poverty in India

Assuring the essentials of food, shelter and clothing to the people

Striving to achieve independence as per the Indian economy is concerned

Help the small as well as the large farmers to increase their productivity This time Indian

government was adamant to achieve self-sufficiency in the economic and production sector.

They endeavored to develop on the factors that ensure a persistent growth in the economy.

The rate of employment was anticipated to rise by 4% every year and the labor force was

anticipated to grow by 39 million at the end of fifth year. Overall improvement was the aim

of the 7th Five Year Plan. Therefore care was taken to establish a harmony in all the sectors

that are contained in an economy. Special care was taken to spread education among girls,

enhance telecommunication within the country. The government of India also strove to

maintain a balance in the economy and by striking a balance within export and import

The thrust areas of the 7th Five year plan have been enlisted below:

Social Justice

Removal of oppression of the weak

Using modern technology

Agricultural development

Anti-poverty programs

Full supply of food, clothing, and shelter

Increasing productivity of small- and large-scale farmers

Making India an Independent Economy


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Based on a 15-year period of striving towards steady growth, the 7th Plan was focused on

achieving the pre-requisites of self-sustaining growth by the year 2000. The Plan expected a

growth in labour force of 39 million people and employment was expected to grow at the rate

of 4 percent per year. Under the Seventh Five Year Plan, India strove to bring about a self-

sustained economy in the country with valuable contributions from voluntary agencies and

the general populace.

Target Growth: 5.0% Actual Growth: 5.7%.

Eighth Five-Year Plan (19921997)

198991 was a period of economic instability in India and hence no five year plan was

implemented. Between 1990 and 1992, there were only Annual Plans. 8th Five Year Plancommenced on 1992 and carried on till 1997. The plan undertook various drastic policy

measures to combat the bad economic situation and to undertake an average annual growth of

5.6%.The basic objective of this period was the modernization of industrial sector. This plan

focused on technical development. Through this plan the reduction of deficit and foreign debt

was aimed at. The rectification of certain flawed plans and policies were also done under this

five year plan. During this period only India received a coveted opportunity to become a

member of the World Trade Organization on January 1st 1995.

In 1991, India faced a crisis inForeign Exchange reserves, left with reserves of only about

US$1 billion. Thus, under pressure, the country took the risk of reforming the socialist

economy.P.V. Narasimha Rao was the twelfth Prime Minister of the Republic of India and

head ofCongress Party,and led one of the most important administrations in India's modern

history overseeing a major economic transformation and several incidents affecting national

security. At that time Dr. Manmohan Singh (currently, Prime Minister of India) launched

India's free market reforms that brought the nearly bankrupt nation back from the edge. It was

the beginning ofprivatisation andliberalisation in India.

Modernization of industries was a major highlight of the Eighth Plan. Under this plan, the

gradual opening of the Indian economy was undertaken to correct the burgeoningdeficit and

foreign debt. Meanwhile India became a member of the World Trade Organization on 1

January 1995.This plan can be termed as Rao and Manmohan model of Economic

development. The major objectives included, controlling population growth, poverty

reduction, employment generation, strengthening the infrastructure, Institutional building,
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tourism management, Human Resource development, Involvement of Panchayat raj, Nagar

Palikas, N.G.O'S and Decentralisation and people's participation. Energy was given priority

with 26.6% of the outlay. An average annual growth rate of 6.78% against the target 5.6%

was achieved.

To achieve the target of an average of 5.6% per annum, investment of 23.2% of the gross

domestic product was required. The incremental capital ratio is 4.1.The saving for invetsment

was to come from domestic sources and foreign sources, with the rate of domestic saving at

21.6% of gross domestic production and of foreign saving at 1.6% of gross domestic

production.

Agricultural Activities During this PeriodAgriculture happens to be the largest contributor to the GDP of India. In fact two third of the

work force was dependent on agriculture. Industries also made use of agricultural produce as

inputs in their production process.

Self-Sufficiency in Agricultural Production

Self-sufficiency in agricultural production was a top priority during India's eighth Five Year

Plan since most of the population depended on that. Production of food increased to 176.22

million from 51 million which was a huge leap in comparison to the previous years.

Ninth Five-Year Plan (19972002)

Ninth Five Year Plan India runs through the period from 1997 to 2002 with the main aim of

attaining objectives like speedy industrialization, human development, full-scale

employment, poverty reduction, and self-reliance on domestic resources. Like all other Five

Year Plans made so far, the 9th Five Year Plan (1997-2002) is formulated, executed and

supervised by the Planning Commission. Background of Ninth Five Year Plan India: Ninth

Five Year Plan was formulated amidst the backdrop of India's Golden jubilee of

Independence.

Primary objectives of the 9th Five Year Plan:


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Each and every Five Year Plan of the Indian government is formulated, keeping in mind the

fulfillment of certain objectives. The 9th Five Year Plan is no exception. The main objective

of this Plan is to achieve the following goals:

to prioritize agricultural sector and emphasize on the rural development

to generate adequate employment opportunities and promote poverty reduction

to stabilize the prices in order to accelerate the growth rate of the economy

to ensure food and nutritional security.

to provide for the basic infrastructural facilities like education for all, safe drinking

water, primary health care, transport, energy

to check the growing population increase

to encourage social issues like women empowerment, conservation of certain benefits

for the Special Groups of the society

to create a liberal market for increase in private investments

Industrialization at a rapid pace

Reduction in poverty level

Gaining self-sufficiency on local resources

Complete employment for all countrymen

Price stabilization should be initiated to hasten up the rate of growth of the Indian

economy

Control the ever-increasing rate of population

Creating an independent market, for enhancing private financial investments

Promotion of social events like conservation of specific benefits for special social

groups, female empowerment, etc.

Achieving self sufficiency in food production

Generation of equal opportunities for employment and taking steps to reduce poverty

Evolution of the 9th Five Year Plans: Some facts

Passed after 50 years of Indian independence, the 9th Five Year Plan was formulated to act as

a tool for solving the economic and social problems existing in the country. The Plan in fact,

was born out of the governments realization that the latent economic reserves of the country

which were still not explored, should be utilized for the overall development and benefit of


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the Indian economy in the coming five years. However, this could only be done when the

Indian government offers strong support and priority to the social spheres of the country,

focusing especially on the complete elimination of poverty. Taking into consideration the

past weaknesses, the 9th Five Year Plan endeavored to formulate fresh actions to initiate

improvement in the overall economic and social sectors of the nation. To this effort, there

was mutual contribution from the general population of India as well as the governmental

agencies. This joint private and public attempt ultimately assured development of the Indian

economy.

During the Ninth Plan period, the growth rate was 5.35 per cent, a percentage point lower

than the target GDP growth of 6.5 per cent.

Tenth Five-Year Plan (20022007)

The 10th Five Year Plan (2002-2007) targets at a GDP growth rate of 8% per annum. Taking

note of the inabilities of the earlier Five Years Plans, especially that of the 9th Five Year

Plan, the Tenth Five Year Plan decides to take up a resolution for immediate implementation

of all the policies formulated in the past. This amounts to making appeals to the higher

government authorities, for successful completion of their campaigns associated with therapid implementation of all past policies. The primary aim of the 10th Five Year Plan is to

renovate the nation extensively, making it competent enough with some of the fastest

growing economies across the globe. It also intends to initiate an economic growth of 10% on

an annual basis. In fact, this decision was taken only after the nation recorded a consistent 7%

GDP growth, throughout the past decade. The 7% growth in the Indian GDP is considered to

be considerably higher that the average growth rate of GDP in the world. This enabled the

Planning Commission of India to extend the GDP limit further and set goals, which will drive

India to become one of the best industrial countries in the world, to be clubbed and

recognized with the worlds best industrialized nations. Like all other Five Year Plans, the

10th Five Year Plan is also devised, executed and supervised by the Planning Commission of

India.

Chief Objectives of the 10th Five Year Plan:

Attain 8% GDP growth per year.

Reduction ofpoverty ratioby 5 percentage points by 2007.
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Providing gainful and high-quality employment at least to the addition to the labour

force.

Reduction in gender gaps in literacy and wage rates by at least 50% by 2007.

Cleaning of all major polluted rivers by 2007 and other notified stretches by 2012

Economic Growth further accelerated during this period and crosses over 8% by

2006.

The Tenth Five Year Plan proposes schooling to be compulsory for children, by the

year 2003.

The mortality rate of children must be reduced to 45 per 1000 livings births and 28

per 1000 livings births by 2007 and 2012 respectively

Making provision for useful and lucrative employments to the population, which are

of the best qualities

According to the Plan, it is mandatory that all infants complete at least five years in

schools by 2007.

By 2007, there should be a decrease in gender discriminations in the spheres of wage

rate and literacy, by a minimum of 50%

Taking up of extensive afforestation measures, by planting more trees and enhance

the forest and tree areas to 25% by 2007 and 33% by 2012

Ensuring persistent availability of pure drinking water in the rural areas of India, even

in the remote parts

The alarming rate at which the Indian population is growing must be checked and

fixed to 16.2%, between a time frame of 2001 and 2011

The rate of literacy must be increased by at least 75%, within the tenure of the Tenth

Five Year Plan

There should be a decrease in the Maternal Mortality Ratio (MMR) to 2 per 1000 live

births by 2007. The Plan also intended to bring down the Maternal Mortality Ratio to

1 per 1000 live birth by the year 2012.

The 10th Five year Plan of India in a nutshell:

o Increasing the mobility of all the available financial resources of India, and

optimizing them as well

o Setting up of a state-of-the-art infrastructure for all the existing industries in India.

o Encourage the initiative of capacity building within the Indian industrial sector

o Creating a friendly, amiable and pleasant investment environment in India


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o Encouraging sufficient transparency in the corporate sectors of India

o Introduction of reforms in the industrial sectors, which are more investor-friendly in

nature

Target growth:8.1% Growth achieved:7.7%.

Eleventh Five-Year Plan (20072012)

India has emerged as a super power. The transition was not easy. Guidelines for operating the

economy was provided by the five year plans. Owing to India's five year plans, great

advancement has been made with regard to India's national income. Since 1951, the year

when the 1st five year plan was presented by the then Prime Minister Jawaharlal Nehru, India

has come a long way. India has taken giant strides and today it is considered as one of the

emerging powers. India is currently following the 11th five year plan. The tenure of the 11th

five year plan is from 2007 to 2012.

The eleventh plan has the following objectives:

1. Income & Poverty

o AccelerateGDP growth from 8% to 10% and then maintain at 10% in the 12th

Plan in order to double per capita income by 201617

o Increase agricultural GDP growth rate to 4% per year to ensure a broader

spread of benefits

o Create 70 million new work opportunities.

o Reduce educated unemployment to below 5%.

o Raise real wage rate of unskilled workers by 20 percent.

o Reduce the headcount ratio of consumption poverty by 10 percentage points.

2.

Education

o Reduce dropout rates of children from elementary school from 52.2% in

200304 to 20% by 201112

o Develop minimum standards of educational attainment in elementary school,

and by regular testing monitor effectiveness of education to ensure quality

o Increaseliteracy rate for persons of age 7 years or above to 85%

o Lower gender gap in literacy to 10 percentage point
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12th Five Year Plan(20122017)

Indias 12th Five Year Plan Focuses on Inclusive Growth. As Indias government prepares

to submit its approach paper for its 12th five-year plan (a plan which covers years 2012 to

2017), the Planning Commissions focus on instilling inclusive growth is making headway.

The plan is expected to be one that encourages the development of Indias agriculture,

education, health and social welfare through government spending. It is also expected to

create employment through developing Indias manufacturing sector and move the nation

higher up the value chain. The commission will likely strive to enact policies that will

achieve somewhere around a 10 percent growth rate in factories and a 4 percent growth rate

in farm produce, though Prime Minister Singh has asked the plan to set the nations growth

rate firmly at 9 percent to 9.5 percent. An important aspect of generating inclusive growth

is shifting the target of government aid to rural areas. Typically, large projects such as power

generation, roads whereby freight can travel, and airports receive the lions share of

government subsidies, while rural infrastructure receives comparatively little. Rural

infrastructure, which serves 70 percent of the population, doesnt get the attention it deserves.

As the Planning Commission sets out to draft the countrys planned investments for the next

five years, it is important to take note of this gap, and the innovative solutions needed to fill

it. As indicated from the planning commissions presentation to the prime minister on April

21, the quantitative metrics known thus far in the early stage of the five-year plan are:

A target of GDP growth in the 9 percent to 9.5 percent range

An increase in literacy rates to 100 percent between the plans period from 2012 to

2017

An increased expenditure on health from 1.3 percent to 2.0 percent of GDP

In a boon for industry, the planning commission indicated that it aims to have industry and

manufacturing-related activities grow by 11 percent over the next five years, contrasted to 8

percent over the previous 11th five-year plan. It also aims to undertake somewhat vaguely

defined, but certainly well-intentioned, structural and regulatory reforms to facilitate

investment .The presentation highlighted the planning commissions views that commercial

energy demand is expected to increase by 7 percent per year over the next five years.To

address that increase in demand, the planning commission recommended that all methods of

current energy production and distribution be developed, from coal to nuclear energy to solar

and wind, and proposed that existing taxes on electricity should not be raised.Interestingly,


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the Planning Commission envisioned an expansive role for Indian SOE Coal India .Coal

India must become a coal supplier and not just a mining company. Should plan to import coal

to meet coal demands. the 12th five-year plan promises a lot for rural development and

growth. the Indian government may be attempting to promote a policy of reverse migration

by making rural living more attractive with some access to modern amenities.


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CONCLUSION

For the smooth functioning of any economy, planning plays an important role.

The Planning Commission has been entrusted with the responsibility of the creation,

development and execution of India's five year plans.India's five year plans are also

supervised by the Planning commission.The economy of India is based in part on planning

through its five-year plans, developed, executed and monitored by the Planning Commission.

Objectives of Planning are Increase in National Income (NI) and Per Capita Income (PCI)

,Full Employment ,Poverty Eradication via rapid economic growth ,reduction of inequalities

of income and wealth ,socialistic pattern of society and absence of exploitation ,reduction in

regional inequalities ,and attaining selfreliance.

For the effective development of every country ,their should be proper planning of the

available resources ,so that it can be used more efficiently and effectively ,if the resources are

not properly allocated than their is a chance of corruption or their may be disutilisation of

resources .


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BIBLIOGRAPHY

BIBLIOGRAPHY

1).Jalal Alamgir, India's Open-Economy Policy: Globalism, Rivalry, Continuity.

2).Baldev Raj Nayar, Globalization And Nationalism: The Changing Balance Of India's

Economic Policy, 19502000.

3).General Knowledge year book of Arihant Mahasagar.

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