PLANNING MECHANISM IN INDIA

MEANING-NATURE AND OBJECTIVES-FEATURES AND TYPES-CENTRALISED AND DECENTRALISED

PLANNING-PLANNING PROCESS

MEANING OF ECONOMIC PLANNING

Deliberate control and direction of the economy by a central authority for the purpose of achieving definite targets and objectives within a specified period of time. Planning is an

economic mechanism for resource allocating and decision making

According to DICKINSON the planning is the making of major economic decisions what and how is to be produced, how ,when and where is to be produced , to whom it is to be allowed, by the conscious decision of a determined authority, on the basis of comprehensive survey of the economic system as a whole.

DEFINITIONS OF ECONOMIC PLANNING

Rapid economic development . Proper utilization of national resources. To provide additional employment. Social justice. To reduce inequalities and disparities of income and wealth. Economic stability. Price stability. To alleviate bottleneck . Rapid capital formation. Coordination. Modernization. Raising investment -income ratio. Removal of poverty.

OJECTIVES OF ECONOMIC PLANNING

Loss of economic freedom. Planning leads to chaos. Not easy to formulate. No incentive s for head works. Danger of bureaucracy and red tapism. Not automatic. More unstable.

CASES AGAINST ECONOMIC PLANNING

Definite objective. Central planning authority. Comprehensiveness. Planning should not comfine only to

production. Rational allocation of resources.

CHARECTERISTICS OF ECONOMIC PLANNING

Central planning authority. Reliable statistical data. Specific objective. Fixation of targets and priorities. Suitable economic organization. Storing and stable government. Fair and efficient administration. Mobilization of resources. Proper balancing in the plan. Flexibility in planning. Economy in administration. International relations.

CONDITIONS FOR SUCCESS OF PLANNING

Unexplained residual factor. Population growth. Non-economic factors.

FEATURES OF ECONOMIC PLANNING

Inward looking policies. Mobilization of domestic agricultural

resources. Competent planning. High degree of planning. Incentive to private sector. Removal of market imperfections. Need of multi national planning. International planning of trade and aid

policies.

HOW TO ACHIVE TARGETS

Nowadays various types of planning small or big, socialist or capitalist, centralized or de centralized, democratic or totalitarian , individual, regional or state, rigid or flexible, perspective or short run, permanent or emergency, have been there. Different countries have tried to adopt them in accordance with their requirement.

The success of the planning for attaining the desired objective greatly depends upon the types of planning chosen by the country it selt.

TYPES OF PLANNING

The planning can be arranged on the basis of time, geographical situation, and economic region etc.

Physical and Financial planning. Structural and Functional planning. Centralized and Decentralized planning. Socialist and Capitalist planning. Direction and Inducement planning. Democratic and Totalitarian planning. Comprehensive and Partial planning. Permanent and Emergency planning. Flexible and Rigid planning. Rolling and fixed planning. Regional, National and International planning. Anti cyclical and Developmental planning.

CLASSIFICATION OF ECONOMIC PLANNING

Physical planning refers to the technique of allocating resources in terms of men , material and machinery.

PHYCICAL PLANNING

The financial planning refers to that technique of planning which allocation of resources is done in terms of money.

FINANCIAL PLANNING

Structural planning implies the objective to change the structure of the society along with economic development and improvement.

STRUCTURAL PLANNING

Functional planning is refers to the existing socio economic framework which is retained as it is. Its only aims at strengthening or repair the same.

FUNCTIONAL PLANNING

In the centralized planning, the entire planning process is comes under a central planning authority. This is also known as planning from above.

CENTRALIZED PLANNING

The decentralized planning refers to the execution of the plan from the grass roots. Thus it is called planning from below. This is formulated by the central planning authority in consultation with different administrative units of economy.

DECENTRALIZED PLANNING

In socialist planning, the economy depends on economic planning that means, on the making of major economic decision by a determinate authority on the basis of a comprehensive survey of the economic system as a whole.

SOCIALIST PLANNING

The capitalist planning is focus on the unplanned economic order which gains momentum from some invisible forces in the market. The main feature of capitalism is the absence of central economic plan.

CAPITALIST PLANNING

Planning by direction is an integral part of a socialist society. It implies complete central planning with no feature of a private economy.

DIRECTION PLANNING

In inducement planning there is no compulsion and direction but only persuasion. Therefore , in, this , the state manipulates the market economy not by command but by providing inducement to secure its objectives.

INDUCEMENT PLANNING

Democratic planning implies a system of economic order in which the authority that vests in the state is based on the support of common masses.

DEMOCRATIC PLANNING

When planning is adopted under a dictator it is called totalitarian planning. Under this , state fully controls the economic affairs , productive resources and economic decisions.

TOTALITRIAN PLANNING

General planning which concerns it self with the major issues for the whole economy is known as comprehensive planning.

COMPREHENSIVE PLANNING

The partial planning is consider only the few important sectors of the economy.

PARTIAL PLANNING

Permanent planning is the long term planning. its goals are wider and ambitious. therefore, planning is permanent in a sense that it is not to be abandoned after some time.

PERMANENT PLANNING

Emergency planning differs significantly from permanent planning . It is purely accidental in character. It is thus, adopted by force of circumstances.

EMERGENCY PLANNING

The perspective planning implies the long term planning of the economy which long range targets are set in advance. It lays down wide objective and strategies for the major sector of the economy. It will split into short periods.

PERSPECTIVE AND SHORT TERM PLANNING

This planning implies the possibility of adjustment, readjustment in targets, outputs, and resources. This type of planning is dynamic .

FLEXIBILITY PLANNING

Rigid planning deals with are not subject to change in any adverse circumstances of the country. It is not suitable for developing countries.

RIGID PLANNING

In this plan, every year, three new plans are framed and the existing one shall roll into the new plan. It shall help the planners to revise plan targets in light of changing circumstances.

ROLLING PLANNING

Fixed plan is a plan for fixed period it lays down definite targets and aims which are to be achieved during the specific plan period.

FIXED PLANNING

Regional planning is a part of national planning. It refers to decentralized control exercised over a region of a particular country.

REGIONAL PLANNING

When economic planning is applied for a nation as a whole ,It is known as the national planning. it always lends coincide with the national territory under a common creed, under a joint rule and for a common objective.

NATIONAL PLANNING

International planning is meant for a state of affairs in which the resources of more than one country are the property of the country as a whole. In another way, it is a matter of pooling the total resources of different national unit.

INTERNATIONAL PLANNING

Anti cyclical planning implies the planning against economic cycles. Its fundamental objective is to achieve economic stability with the prevailing socio-economic framework of the country.

ANTI CYCLICAL PLANNING

Developmental planning seeks to explore new employment avenues and raise the level of income and output . It seeks to achieve the higher level of income and employment by breaking the structural impediments and to growth to under development and backward countries.

DEVELOPMENTAL PLANNING

Imperative planning includes preparation and implementation has to be certain sure . It means once plan is drawn up, it has to be implemented.

IMPERATIVE PLANNING

Indicative planning is practiced by developed countries. It is not suitable for under developed countries. This planning works through coordination among different economic units.

INDICATIVE PLANNING

The process of planning includes the determination of objectives and outlining the future actins that are needed to achieve these objectives.

PLANNING PROCESS

Evaluate plan.

Gather information.

Mission and goals.

Devise strategies.

Implement plan.

Monitor performance.

STEPS IN PLANNING PROCESS

Submitted by : APARNA

GS Sem: 1 St.Xavier’s

College Thumba