Economic planning can be defined as making a conscious and deliberate choice of economic priorities and utilising country’s resources in various activities in accordance with these priorities.
To do this, some central planning authority such as the Planning Commission is set up which conducts extensive survey of the available and potential resources, formulates plans specifying the goals and targets and directs the flow of resources into channels and activities designed for time-bound achievement of the given targets.
Image Source: 185.26.182.219
Advent of Planning in India:
ADVERTISEMENTS:
The idea that India should have planned economic development is quite old. In 1934, M. Visvesvaraya, an eminent engineer, published his book, “Planned Economy for India” in which he pleaded that scientific plans should be formulated for India’s economic reconstruction.
In 1938, the All India Congress Committee set up a National Planning Committee with Pandit Jawaharlal Nehru as its chairman. Then in 1940, eminent industrialists of India formulated a plan for country’s industrial development, which was known as the Bombay Plan
The Planning Commission of India:
The real work on planning started after independence with the setting up of the Planning Commission of India in 1950. The commission was asked to make a comprehensive assessment of country’s actual and potential resources and formulate plans for rapid economic development of India.
The Planning Commission formulates plans for medium term developments called the Five-year Plans. Besides it also makes plans for long term development (15 years or so) called Perspective plans. Within the Five-year Plan, it also draws Annual Plans for each year of the Five-Year Plan. The Planning commission is purely an advisory body.
ADVERTISEMENTS:
It only makes the plans and advises the government on various economic policies that need to be adopted for fulfillment of the planned targets. The actual implementation of the plans is the responsibility of the Government of India which gets it done through its various ministries and departments.
The planning commission also makes assessment of the progress made during the plan. Almost half way through each plan there is a ‘Mid-term Appraisal’ of the progress so that shortfalls in reaching the planned targets can be made up by incorporating some changes in policies and programmes.