India's Five Years Plan
Origin
Five year plans were first introduced in the erstwhile Soviet Union in 1928 for controlled and rapid economic development. Much of the Soviet industrial successes are a result of the implementation of its five year plans. In 1950, India’s prime minister Jawaharlal Nehru, impressed by the Soviet system, adopted five year plans as a model for economic development, and established the Planning Commission which was to act independent of any cabinet and was answerable only to the Prime Minister, who is also Chairperson of the commission. Draft plans were to be approved by the National Development Council, comprising the Planning Commission and the Chief Ministers of all states. An approved plan is then passed by the cabinet and then in Parliament.
The benefits of five year planning, especially in a country as big and unpredictable as India, have been questioned by many, and it has often been seen that targets are not met. This method has still not been able to successfully get rid of poverty and the cost overruns in failed or incomplete public sector projects are often too high. Be that as it may, five year plans are still a good yardstick to determine investment and policy priorities.
Brief history
India's five greatest problems, Jawaharlal Nehru once remarked, are land, water, cows, capital and babies. To deal with them, he launched India's First Five-Year Plan, which has coped fairly well with the first three. But the shortage of capital to create jobs and necessities for an enormous and fast-growing population has not been solved, and Prime Minister Nehru is impatient for a solution.
"We cannot wait," said he. "That is the difficulty. We have to think in terms of large schemes of social engineering, not petty reforms." India's First Five-Year Plan still had six months to run, but Nehru and his government were plunging ahead with a far more ambitious Second Five-Year Plan, which planners said should add 25% to the national income ( about $22 billion in
Five year plans were first introduced in the erstwhile Soviet Union in 1928 for controlled and rapid economic development. Much of the Soviet industrial successes are a result of the implementation of its five year plans. In 1950, India’s prime minister Jawaharlal Nehru, impressed by the Soviet system, adopted five year plans as a model for economic development, and established the Planning Commission which was to act independent of any cabinet and was answerable only to the Prime Minister, who is also Chairperson of the commission. Draft plans were to be approved by the National Development Council, comprising the Planning Commission and the Chief Ministers of all states. An approved plan is then passed by the cabinet and then in Parliament.
The benefits of five year planning, especially in a country as big and unpredictable as India, have been questioned by many, and it has often been seen that targets are not met. This method has still not been able to successfully get rid of poverty and the cost overruns in failed or incomplete public sector projects are often too high. Be that as it may, five year plans are still a good yardstick to determine investment and policy priorities.
Brief history
India's five greatest problems, Jawaharlal Nehru once remarked, are land, water, cows, capital and babies. To deal with them, he launched India's First Five-Year Plan, which has coped fairly well with the first three. But the shortage of capital to create jobs and necessities for an enormous and fast-growing population has not been solved, and Prime Minister Nehru is impatient for a solution.
"We cannot wait," said he. "That is the difficulty. We have to think in terms of large schemes of social engineering, not petty reforms." India's First Five-Year Plan still had six months to run, but Nehru and his government were plunging ahead with a far more ambitious Second Five-Year Plan, which planners said should add 25% to the national income ( about $22 billion in
Bibliography: Books Refer:- 1. Essentials of Business Environment by K. Aswathappa 2. Indian Economy since Independence by Uma Kapila Websites Refers:- 1. www.wikipedia.org/ 2. www.planningcommission.gov.in/ 3. www.economywatch.com/