Def initi on and scope of

pl anni ng
 Planning means systematic utilization
of the available resources at a
progressive rate so as to secure an
increase in output, employment and
social welfare of the people.
 Implementation is very important. A
country may have good plans, but may
not have proper machinery for
implementation.
 Ec on omi c
pl ann in g
 The problem of development
of an underdeveloped country
is that of utilizing more
effectively the potential
resources available to the
community. This involves
economic planning.
 Pla nnin g
 Definition by Prof Waterson
an organized and conscious
and continual attempt to
select the best available
alternatives to achieve
specific goals.
Obj ecti ves of plan ning in
Ind ia
 Increasing national income
 Reducing inequalities in the
distribution of income and wealth
 Elimination of poverty
 Providing additional employment
 Remove the bottlenecks in
agricultural production,
manufacturing capacity and
balance of payments
Planning in In dia
 After attaining independence, the
government of India set up the
planning commission in 1950 with
Prime Minister as the Chairman.
 The purpose of the commission was to
assess carefully the human and
material resources of the country and
to prepare the plans for the effective
use of resources
 Planning comm issio n
 Set up in 1950 by a resolution of Govt
of India, under the chairmanship of
Pandit Jawaharlal Nehru.
 Plan was to prepare a plan for the
“most effective and balanced
utilization of the country’s resources
 Only an advisory board entrusted with
the preparation of plan. It is not
responsible for execution
 Functi ons
 To make an assessment of the
materials, capital and human
resource of the country and find
out possibilities to improve
 To recommend the allocation of
resources between sectors based
on priority
 Prepare the final plan document
 Functio ns
 Appraise from time to time the
progrss made
 Examine specific problems relating to
planning and development
 Planning commission is thus a staff
agency preparing the plan
documents and confining its role as
“advisory”
 ADMI NIS TRAT ION
 PM will be the Chairman.
 A fulltime deputy Chairman
 Includes 4 full time members and few part time
members who are important cabinet ministers
 Secretary of the commission.
 Additional secretary who is in charge of administration
and co-ordination within commission
 In addition, there are some senior officers in the ranks
of deputy secretaries and under secretaries who
watch the progress of different programs.
 Full time members will be eminent men, technical
experts, economists and administers.
 Vari ous di vi sions
 The planning
commission is a subjeect

collective body
with collective
responsibility. evaluation coordination

Each member is Divisions

in charge of a
group of
divisions. There general special

are many
divisions
 Ot her bodies con nec ted
with pl annin g
comm issi
National planning ons1965
commission,
Consists scientists, engineers, economists and it has 12 study groups related to
power, mgmt, agriculture, land reforms, education, research, labor, employment
Social welfare, industry, family planning, international trade, natural resource etc

National development commission

Consists of PM-Chairman,chief ministers
Research program committee, and few central ministers
Consists of leading scientists and economists, Functions-review the working of plan,
who initiate research through universities discuss problems related to national
and research institutions development, recommend measures,
improve efficiency of administrative services,
ensure co-operation of people,
NDC is only consultative body
 An appraisa l
 Has been entrusted with gigantic task of
preparing development plans.
 Planning has transformed the country from
stagnation to development
 Made fair allocation of resources and major
share went to infrastructural developments,
agriculture etc
 Helped backward states by allocating larger
resources
 Encouraged research
 Evaluation committee assessed projects and
advised commission
 Limit ations and
critic ism
 The commission exercised unlimited
powers-many described it “parallel
cabinet”, “super cabinet”, “fifth wheel
of the coach”
 Politically motivated-change of govts.
 The states could not implement the
programs due to red-tapism, corruption
and inefficiency. Plans are good but
implementation is a failure
 Limit ations and
critic ism
 Commission has enormous
powers without any responsibility
and it is not responsible for failure
 It is only administrative body and
it is neither a goal setter or path
maker
 State govts are neglected
 Many targets have become paper
targets
In dustria liza ti on
 Need

 Agriculture development
and industrialization
 Development of indian
industry
 Probl ems of
industri al izat ion
 Under-utilization of resources
 Low capital formation

 Low level of technology

 Population explosion

 Attitude of the people

 Imp orta nce
 Material riches and
industries go together
 Less developed
countries lack industries
and have to live in
poverty
 Imp or ta nce
 Industrialization does not mean merely
starting industries. Even before
independence, India had cotton textile
industry, jute industry, sugar industry
and also iron and steel industry. But
India cannot be called an Industrialized
country
 Industrialization constitute
development of infra structure like
transport, power, communication etc
 Political stability/climate
 Attitude of the people
 Ne ed fo r
indust riali zation
1. Increasing the income
substantially
2. Meeting high income elasticity of
demand
3. Foreign exchange/comfortable
balance of payments
4. Transferring surplus labor
5. Providing strength and security
to economy
Agricul tural devel opm ent
and i ndust ria li zati on
 Improvements in productivity of agriculture is
one of the most solid means of promoting
industrialization.
 Unless agriculture does not modernize,
industrial expansion will be at low speed
since majority of population will not have
necessary purchasing power.
 On the other hand, agricultural improvement
cannot go very far unless there is industrial
development to take up released labor and
also to modernize the agriculture.
 Therefore, both are related
 Eff ects of
industri al izat ion
 Internal structural changes (secondary
industries, increase of wage earners,
economic, social, psychological,
political changes)
 Foreign trade (imports of consumer
articles will be reduced, imports will be
mainly capital goods)
 Social consequences (standard of
living)
 Dev elopm ent of Indian
Ind ustry
 Industrial production in India is very
impressive since the introduction of
planning.
 Industrial production has crossed more
than 5 times
 Modernization took place
 Introduction of capital goods
industries.
 Able to produce durable consumer
industries like bi cycles, fans,TVs for
exports
 Limit atio ns

 Declining productivity and high

cost of production- 3 or 4 times
the cost of world cost
 Existence of large unused
capacity in industries
 Industrial sickness
 unequal regional development
 Employment generation is not
satisfactory