ECONOMIC PLANNING IN INDIA

Dr. Pinki Insan Asst. Prof. IGPGRC MDU Rohtak.

ECONOMIC PLANNING IN INDIA

WHAT IS PLAN ?

A plan spells out how the resources of a nation should be put to use.

It should have some general goals as well as specific objectives which are to be achieved with in a specified period of time.

In India plans are of five year duration and are called FIVE YEAR PLAN.

OBJECTIVES OF PLANNING –

ECONOMIC GROWTH.

SELF- RELIANCE.

REMOVAL OF UNEMPLOYMENT.

REDUCTION IN INCOME INEQUALITIES.

ELIMINATION OF POVERTY.

PLANNING COMMISSION

The PLANNING COMMISSION is an institution in the Government of India, which formulates India’s Five year plan.

Planning commission was

set up on 15 MARCH 1950,

With Prime minister

JAWAHARLAL NEHRU

as the chairman.

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Why to Plan ???After independence, India was in dire conditions and needed to start acting soonSome of the problems necessitated need for an immediate plan:Vicious circle of poverty

Foreign Trade

Need for Rapid industrialization

Population pressure

Development of Natural resources

Capital Deficiency & Market imperfections

Economic Planning

Economic Planning is to make decision

with respect to the use of resources.

Mess Poverty And Low Per Capita Income

High Rate of Growth of Population.

Industrial Growth Was Negligible.

Low Level of Literacy.

Backward Technology.

Traditional Attitude.

Social And Economic Problem Created By Partition Of Country.

Need For Economic Planning

Economic Growth.Reduction Of Economic In Equalities.

Balanced Regional Development.

Modernization.Reduction Of Unemployment.

Objective of Economic Planning

Planning commission of India was setup in March 1950 by government of India. The task before planning commission of India are:-

EFFECTIVE UTILIZATION OF RESOURCES.PREPARE FIVE YEAR PLAN ALONG WITH ITS

OBJECTIVE.CO-ORDINATION WITH STATE GOVERNMENT

OF INDIA FOR EXECUTION OF PLAN.DETERMINATION OF PRIORITIES, STAGES OF

PLAN AND PROPOSE OF ALLOCATION OF RESOURCES FOR DUE COMPLETION OF STAGES.

Planning commission of India

Planning commission of in India members are

Chairman- Dr. Manmohan Singh Prime Minister

Deputy Chairman- Shri Montek singh Ahluwalia Member Secretary- Shri Rajeev Ratna Shah

FIRST FIVE YEAR PLAN(1951-1956)

• Presented by – JAWAHARLAL NEHRU

•Total outlay - Rs. 2069 Crores

• Target growth – 2.1%growth in gross domestic product.

“ TOWARDS FASTER AND MORE

INCLUSIVE GROWTH”.

ELEVENTH FIVE YEAR PLAN (2007 – 2012)

OBJECTIVES GDP Growth rate to be increased to 10% by the end of plan.

Farm sector growth to be increased to 4%

Creation of SEVEN CRORE JOB opportunities.

Reduced Educated unemployment youth to below 5 PERCENT.

INFANT MORTILITY RATES to be reduced to 28 per 1000 lives.

MATERNAL DEATH RATES to be reduced to 1 per 1000 births.

CLEAN DRINKING WATER to all by 2009.

Improve SEX RATIO to 935 by 2011-12.

ROADS TO ALL VILLAGES that have a population of 1000 and more by 2009.

Increase Forest and Tree cover by 5 %.

Achieve the WORLD HEALTH ORGANISATION standard Air quality in major cities by 2011-12.

Increase AGRICULTURE GDP growth to 4 Percent per annum.

Connect every village by TELEPHONE by 2007 and BROADBAND connectivity to all villages by 2012.

Treat all urban WASTEWATER by 2011-12 to CLEAN RIVER WATERS.

Eleventh Five Year Plan (2007-2012)

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Introduction:The National Development Council has approved the 11th Five Year Plan for the period from 2007 to 2012. The plan document is entitled “Towards Faster and More Inclusive Growth”. The Indian economy on the eve of 11th Plan is much stronger than it was on the eve of 10th Plan. 10th Plan has achieved the highest growth rate of GDP at 7.8 percent. The 11th plan enters with a saving rate at 34.8 percent of GDP and the investment rate at 35.9 percent of GDP. The priority areas for this plan are agriculture, irrigation and water resources, education, health, infrastructure, employment, upliftment of SCs/STs, other backward classes, minorities, women and children. The Central vision of the 11th plan is to build on our strengths to trigger a development process which ensures broad-based improvement in the quality of life of the people, especially the poor, SCs/STs, OBCs, minorities and women. The National Development Council has endorsed a target of 9% GDP growth for 11th Plan. Government has visualized not only the faster but inclusive growth also. Inclusive growth means a growth process which yields broad-based benefits and ensures equality of opportunity for all.

Objectives/Targets of plan:

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Infrastructure• Roads• Ports• Airports• Railways• Power• Irrigation• Telecom/IT

EducationYouth AffairsSports and Physical EducationHealthWomen and ChildrenIncome and PovertyEnvironment

Sectoral Growth Targets of 11th Plan:

Financing of Eleventh Five Year Plan:

Resources Central Government

States and UTs Total

1. Balance from Current Revenue

6,39,989 3,85,050 10,39,039

2. Borrowings 7,67,722 6,49,423 14,17,145

3. Net Inflow from abroad

- - -

4. Resources of PSEs 10,59,711 1,28,824 11,88,535

5. Aggregate Resources (1 to 4)

24,81,422 11,63,296 36,44,718

6. Assistance to States and UTs

-3,24,851 3,24,851 -

TOTAL RESOURCES 21,56,571 14,88,147 36,44,718

Area Growth Rate per Annum (in %)

Gross Domestic Product (GDP)

9.0

Agriculture 4.1

Industry 10.5

Services 9.9

Exports 16.4

Imports 12.5

Financing Pattern of Public Sector Outlay during 11th Plan

(Rs.` Crore at 2006-07 prices)

(Source: Economic Survey, 2007-08, p.a-50)(Source: Planning Commission)

Resource Allocation in 11th Five Year Plan:

Items Proposed Outlay (Rs.` Crore)

Percentage of Total outlay

1. Agriculture and Allied Activities

1,36,381 3.7

2.Rural Development 3,01,069 8.3

3. Special Area Programme for Backward Regions

26,329 0.7

4. Irrigation and Flood Control

2,10,326 5.8

5. Energy 8,54,123 23.4

6. Industry and Minerals 1,53,600 4.2

7.Transport 5,72,443 15.7

8. Communication 95,380 2.6

9. Science, Technology and Environment

87,933 2.4

10. General Economic Services

62,523 1.7

11. Social Services 11,02,237 30.3

12. General Services 42,284 1.2

TOTAL 36,44,718 100

Eleventh Plan Outlay and Its Allocation (at 2006-07 Prices)

(Source: Economic Survey, 2007-08, p.a-47)

Strategy of 11th Plan:

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THE MAIN ELEMENTS OF STRATEGY OF 11TH PLAN ARE:

1. RAPID GROWTH2. INCLUSIVE GROWTH3. MAIN PRIORITY

AREAS(EDUCATION AGR,HEALTH,EMPLOMENT)

4. MAIN FOCUS ON PRIVATE SECTOR

Main Areas of 11th Plan:Main areas of 11th plan are as follows:1. Agriculture2. Infrastructure

HighwaysAirportsRailwaysPower Generation

3. Rural Infrastructure: Specific Targets of Bharat Nirman Programme for the Period (2005-2009)

IrrigationRural RoadsRural HousingRural WaterRural ElectrificationRural Telephone

4. Industry5. Employment6. Education7. Health8. Social Sector

Income & PovertyAccelerate growth rate of

GDP from 8% to 10% and then maintain at 10% in the 12th Plan in order to double per capita income by 2016-17.

Increase agricultural GDP growth rate to 4% per year.

Reduce educated unemployment to below 5%.

Raise real wage rate of unskilled workers by 20 percent.

11th Five Year Plan Target

Reduce dropout rates of children from elementary school from 52.2% in 2003-04 to 20% by 2011-12.

Increase literacy rate for persons of age 7 years or more to 85%.

Lower gender gap in literacy to 10 percentage points.

Increase the percentage of each cohort going to higher education from the present 10% to 15% by the end of the 11th Plan.

Education

Provide clean drinking water for all by 2009 and ensure that there are no slip-backs by the end of the 11th Plan.

Reduce malnutrition among children of age group 0-3 to half its present level.

Reduce anemia among women and girls by 50% by the end of the 11th Plan.

Health

Ensure that at least 33 percent of the direct and indirect beneficiaries of all government schemes are women and girl children.

Ensure that all children enjoy a safe childhood, without any compulsion to work

Women and Children

Ensure electricity connection to all villages and BPL households by 2009 and round-the-clock power by the end of the Plan.

Ensure all-weather road connection to all habitation with population 1000 and above (500 in hilly and tribal areas) by 2009, and ensure coverage of all significant habitation by 2015.

Connect every village by telephone by November 2007 and provide broadband connectivity to all villages by 2012.

Infrastructure

Increase forest and tree cover by 5 percentage

points. Attain WHO standards

of air quality in all major cities by 2011-12.Treat all urban waste

water by 2011-12 to clean river waters.Increase energy

efficiency by 20 percentage points by

2016-17

Environment

ConclusionEconomic Planning help in mobilizing and

allocating the resources in desired manner.

Objective of economic planning is to reduce inequality, economic growth, balanced regional growth, modernization.

Each five year plan aims at achieving certain target. Five year plan constitute the steps toward the fulfillment of objectives of economic planning.