Planning Commission

Established in March 1950, the Planning Commission is an institution in the Government of India, headed by the Prime Minister, providing a platform for the efficient planning by formulating India’s Five Year Plans. The Planning Commission of India was established by the Government of India with an objective to ensure effective utilization of resources to meet the immediate demand of employment opportunities for the citizens and to promote the overall standard of living in the country. Along with several other functions and responsibilities, the most important responsibility of the Planning Commission is to make an acute assessment of the resources present in the country, augment deficient resources, determine priorities’ and finally formulate a Five Year Plan for the most efficient and balanced utilization of resources of the country.
The First Five Year Plan of India was launched and presented before the Parliament by the Planning Commissionon April 1, 1951. The tenure of the First Five Year Plan was from year 1951 till year 1956. After this, two subsequent plans were formulated by the Planning Commission of India till 1965, when there was a break owing to the Second Kashmir War between India and Pakistan. Devaluation of currency, two years of successive drought, inflation and erosion of resources further disrupted the five year planning process for a further period of three years between 1966 and 1969. After the three annual plans, the Fourth Five Year Plan was issued by the Planning Commission of India in 1969.
Later in 1990, the Five Year Planning Process was again interrupted by the fast changing political scenario at the centre. As a result, the Eighth Five Year Plan which was scheduled to take off in 1990 was not passed by thePlanning Commission. Instead, two annual plans were again passed in year 1990 and 1991. Finally, this Eighth Five Year Plan of the Planning Commission was passed in 1992 after the initiation of the structural adjustment policies. After the launch of the eighth plan, the planning process in India has been smooth so far. The Twelfth Five Year Plan is all set to take off in 2012.

Functions of the Planning Commission

The functions of the Planning Commission, determined at the time it was established in 1950 are listed as follows:
  • Make an assessment of the material, capital and human resources of the country, including technical personnel, and investigate the possibilities of augmenting such of these resources as are found to be deficient in relation to the nation’s requirement.
  • Formulate a Plan for the most effective and balanced utilization of country’s resources.
  • On a determination of priorities, define the stages in which the Plan should be carried out and propose the allocation of resources for the due completion of each stage.
  • Indicate the factors which are tending to retard economic development, and determine the conditions which, in view of the current social and political situation, should be established for the successful execution of the Plan.
  • Determine the nature of the machinery which will be necessary for securing the successful implementation of each stage of the Plan in all its aspects.
  • Appraise from time to time the progress achieved in the execution of each stage of the Plan and recommend the adjustments of policy and measures that such appraisal may show to be necessary.
  • Make such interim or ancillary recommendations as appear to it to be appropriate either for facilitating the discharge of the duties assigned to it, or on a consideration of prevailing economic conditions, current policies, measures and development programmes or on an examination of such specific problems as may be referred to it for advice by Central or State Governments.
Today, the planning process in India is gradually inclining towards the indicative planning. In this indicative planning, the Planning Commission focuses on building a long term strategic vision and decides on the priorities of the country. The focus now is to work out the sectoral targets and provide a stimulus to the economy to grow in a desired direction.

Planning Commission has an important role in the development of a holistic approach to the policy formulation in the critical areas of human and economic development. The focus of the Planning Commission is on maximizing the output by utilizing our limited resources optimally.


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