Five Year Plans

Five Year Plans form an important portion of the planning process in India. These are formulated, executed and monitored by the Planning Commission of India, which is an institution in the Government of India, headed by the Prime Minister.
The First Five Year Plan, formulated by the Planning Commission, was presented and launched in the Parliament of India by Jawaharlal Nehru, India’s first Prime Minister, on 1st April 1951. The tenure of this plan was from year 1951 to 1956. After the completion of this tenure, the second and the third Five Year Plans were successfully formulated and launched by the Planning Commission. Although, in 1965, when the Second Kashmir War betweenIndia and Pakistan broke out and consequently the smooth process of planning in India got interrupted. Two years of successive drought, devaluation of currency, inflation and erosion of resources further disrupted the planning process. As a result, instead of formulating a Five Year Plan in 1966, the Planning Commission had to formulate three annual plans between the years 1966 and 1969. After these three annual plans, the Fourth Five Year Planwas formulated and launched in 1969.
The Planning Commission conducted the planning process smoothly after 1969 and it formulated, executed and monitored four Five Year Plans successfully after 1969 on scheduled time. However, in 1990, the Eighth Five Year Plan could not be formulated as a result of the fast changing political scenario in the country. Hence, the Planning Commission again had to formulate two annual plans for year 1990 and 1991. Finally, the Eighth Five Year Planwas launched by the Planning Commission in 1992. After this, the planning process in India has been smooth so far. Presently, the Eleventh Five Year Plan issued by the Planning Commission is underway and the Twelfth Five Year Plan is all set to be launched in 2012.
The glimpses of the various Five Year Plans launched by the Planning Commission of India, along with their tenure, are mentioned below.
  • First Five Year Plan (1951-1956)
  • Second Five Year Plan (1956-1961)
  • Third Five Year Plan (1961-1966)
  • Fourth Five Year Plan (1969-1974)
  • Fifth Five Year Plan (1974-1979)
  • Sixth Five Year Plan (1980-1985)
  • Seventh Five Year Plan (1985-1989)
  • Eighth Five Year Plan (1992-1997)
  • Ninth Five Year Plan (1997-2002)
  • Tenth Five Year Plan (2002-2007)
  • Eleventh Five Year Plan (2007-2012)

First Five Year Plan

The First Five Year Plan formulated by the Planning Commission of India was presented before the parliament on 1st April 1951 by Jawaharlal Nehru, India’s first Prime Minister. The tenure of this plan was between 1951 and 1956. With this plan, the Planning Commission tried to address the problems of the agricultural sector, which was severely hit after the partition of the country. The total planned budget of this Five Year Plan was 206.8 billion which was broadly allotted to seven different areas which are listed in the table below.
AreaIrrigation & EnergyAgriculture & Community DevelopmentTransport & CommunicationsIndustrySocial ServicesLand RehabilitationOther Sectors & Services
Budget Allocation27.2%17.4%24%8.4%16.64%4.1%2.5%

Many irrigation projects and dams, including the Bhakra Dam and the Hirakud Dam, were initiated under this plan. The government of India, along with the World Health Organization, also addressed the alarming problems of children’s health. As a result the infant mortality rate was significantly controlled.
By the end of this First Five Year Plan in 1956, the University Grant Commission was established to facilitate funding and to strengthen the higher education in the country. Five IITs (Indian Institute of Technology) were also opened successfully as major technical education institutions in the country. Under this plan several initiatives were also taken to start five steel plants in the country. These plants were completely established by the middle of theSecond Five Year Plan.
The First Five Year Plan targeted to achieve a growth rate equal to 2.1% of the annual gross domestic product (GDP) but India managed to achieve a higher growth rate of 3.6% of the annual gross domestic product (GDP).

Second Five Year Plan

The Second Five Year Plan was launched in 1956. Under this plan, the focus was shifted towards the industrial sector from the agrarian sector. The major emphasis under this plan was to increase the domestic production of industrial products through the development of public sector industries in India. The Mahalanobis model, formulated by Prasanta Chandra Mahalanobis, was highly used under this plan to determine the optimal allocation of resources to different sectors of production so as to attain maximum long run economic growth.
The total planned budget for the Second Five Year Plan was Rs. 480 million. This amount was allocated to four different sectors, namely – communications and transport, power and irrigation, social services and miscellaneous.
By the end of this plan tenure, there was a sizable improvement in the production of coal and many new railway lines were laid to address the problems in transporting raw materials. Also, the five steel plants which were initiated during the tenure of the First Five Year Plan were completed under this plan.

Third Five Year Plan

Initially, the Third Five Year Plan was formulated with a prime focus on agriculture, majorly on improving the production of wheat but as a result of the India-China war in 1962, soon the focus was shifted towards country’s defense industry. Later, India fought another war with Pakistan in 1965 which resulted in high rates of inflation in the country and consequently the focus of the Third Five Year Plan was again shifted towards price stabilization.
The targeted growth rate under this Five Year Plan was to achieve a growth rate equal to 5.6% of GDP but the rate actually achieved was much lower (only 2.2% of GDP). However, some major developments were made in the education sector, during this plan tenure, including the formation of state boards of secondary education and establishment of primary schools in rural areas.

Fourth Five Year Plan

The Fourth Five Year Plan was initially focused towards the development of country’s industrial sector but as a result of the India-Pakistan war in 1971, a major segment of the allotted funds was diverted towards the war needs.
Some major developments under this plan include the initiation of Green Revolution in India and the nationalization of fourteen Indian banks. India also successfully performed its first nuclear test in 1974.
The targeted growth rate during this plan was 5.7% of GDP but the growth rate actually achieved was just 3.3% of the GDP.

Fifth Five Year Plan

The Fifth Five Year Plan formulated by the Planning Commission of India mainly focused on the alleviation of poverty and employment generation in the country. Increased domestic production of agricultural and defense products were the other prime objectives of this plan.
Some major achievements made during the tenure of this Five Year Plan include the introduction of Indian national highway system and the enactment of the Electricity Supply Act in 1975.
The targeted growth rate under this Five Year Plan was 4.4% of GDP but a higher growth rate equal to 5.5% ofGDP was actually achieved.

Sixth Five Year Plan

The Sixth Five Year Plan introduced the concept of family planning in India. Unlike China, the family planning inIndia was introduced in form of an awareness campaign and not as a forceful obligation. This introduction to the family planning concept yielded good results in certain privileged areas of India where the birth rate was sizably controlled. However, in many under privileged areas of the country, high birth rate is still a major problem to address.
To achieve a growth rate equal to 5.2% of GDP was set under this Five Year Plan but a higher growth rate, 5.4% of GDP, was actually achieved.

Seventh Five Year Plan

The Seventh Five Year Plan primarily focused on employment generation, increasing economic productivity and the production of food grains. The success of the Sixth Five Year Plan laid a strong foundation for this plan and made the goals set under this Five Year Plan more realistic. The key efforts laid under this plan were on the areas listed below.
  • Anti-poverty programs
  • Increase supply of food, clothing and shelter
  • Promoting the use of modern technology
  • Development of agriculture
The target growth rate to achieve under this Five Year Plan was 5% of GDP but India successfully managed to achieve a higher growth rate equal to 5.7% of GDP.

Eighth Five Year Plan

The Eighth Five Year Plan was formulated and launched by the Planning Commission in 1992 after the economic reforms of 1991 in the country. The major emphasis under this Five Year Plan was laid on the modernization of the existing public sector industries. Other objectives set under this plan are listed below.
  • Poverty reduction
  • Infrastructure development
  • Tourism Management
  • Empowerment of Panchayat Raj, Nagar Palika and NGOs
  • Decentralization of power
  • Development of Energy sector
  • Population control
The target growth rate set under this Five Year Plan was 5.6% of the annual GDP whereas the actually achieved growth rate was comparatively higher, standing at 6.78% of the annual GDP.

Ninth Five Year Plan

The Ninth Five Year Plan of the Planning Commission was formulated and launched in 1997. The primary emphasis under this plan was laid on self resilience and speedy industrialization. Other main objectives set under this plan are listed below.
  • Human Development
  • Employment Generation
  • Poverty Reduction
  • Rural Development
  • Promote Primary Education
  • Price Stabilization
  • Population Control
  • Food and Nutritional Security
The Ninth Five Year Plan proposed a target growth rate of 6.5% of GDP. However, India could only manage a growth rate equal to 5.35% of GDP.

Tenth Five Year Plan

The Tenth Five Year Plan was launched by the Planning Commission in 2002. The primary objectives of this plan are listed below.
  • Higher Female Literacy Rate
  • Poverty Alleviation
  • GDP growth rate of 8%

Eleventh Five Year Plan

The Eleventh Five Year Plan is the latest plan issued by the Planning Commission. The tenure of this plan will last till 2012. The emphasis under this Five Year Plan is laid on six areas which are listed below.
  • Income & Poverty
  • Education
  • Health
  • Women & Children
  • Infrastructure
  • Environment

The success analysis of this Five Year Plan and the next plan is soon to be issued by the Planning Commission.


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