ECONOMIC PLANNING IN INDIA

Overview

PLANNING COMMISSION AND ITS FUNCTIONS

To make an assessment of the material, capital and human resources of the country To investigate the possibilities of augmenting resources as are found to be deficient in relation to the nations requirements To formulate plans for most effective and balanced utilisation of countrys resources
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RATIONALE FOR PLANNING

Inefficiencies of market mechanism Need for social justice Resource mobilisation development programme and overall

PLANNING PROCESS

Planning body Survey of resources and collection of necessary data Setting of planning objectives Priorities Development strategy Balancing act Resource mobilisation Administrative efficiency
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INDIAN FIVE YEARS (SPECIAL FEATURES)

PLANS

Indicative economic planning Comprehensive Physical planning Indian planning is social planning Exhaustive data
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OBJECTIVES PLANNING

OF

ECONOMIC

Economic growth
Self reliance

Removal of unemployment
Reduction of income inequalities

Elimination of poverty
Modernisation
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STRATEGY PLANNING

OF

ECONOMIC

Development of sound base for long term growth High priority to industrialisation Emphasis on development of capital goods industries

OBJECTIVES OF 10TH FIVE YEAR PLAN

Reduction of poverty ratio by 5 percentage points by 2007;

Providing gainful and high-quality employment at least to the addition to the labour force; All children in school by 2003; all children to complete 5 years of schooling by 2007; Reduction in gender gaps in literacy and wage rates by at least 50% by 2007; Reduction in the decadal rate of population growth between 2001 and 2011 to 16.2%; Increase in Literacy Rates to 75 per cent within the Tenth Plan period (2002-3 to 2006-7);

Objectives.

Reduction of Infant mortality rate (IMR) to 45 per 1000 live births by 2007 and to 28 by 2012;
Reduction of Maternal Mortality Ratio (MMR) to 2 per 1000 live births by 2007 and to 1 by 2012; Increase in forest and tree cover to 25 per cent by 2007 and 33 per cent by 2012; All villages to have sustained access to potable drinking water within the Plan period; Cleaning of all major polluted rivers by 2007 and other notified stretches by 2012; Economic Growth to be further accelerated during this period and crosses over 8% by 2006
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Growth Strategy of 10th FYP

More investor friendly flexible economic reforms Creation of congenial investment environment Encourage private sector involvement Setting up state-of-the-art infrastructure Capacity building in industry Corporate transparency Mobilizing and optimizing all financial resources Implementation of friendly industrial policy instruments

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ECONOMIC GROWTH
per cent per annum

Target
1. First Plan (1951-56) 2. Second Plan (1956-61) 3. Third Plan (1961-66) 4. Fourth Plan (1969-74) 5. Fifth Plan (1974-79) 6. Sixth Plan (1980-85) 7. Seventh Plan (1985-90) 8. Eighth Plan (1992-97) 9. Ninth Plan (1997-2002 10.Tenth Plan (2002-2007) 2.1 4.5 5.6 5.7 4.4 5.2 5.0 5.6 7.0 8.7

Actual
3.61 4.27 2.84 3.30 4.80 5.66 6.01 6.78 6.0 7.1
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RELATED PROBLEMS

Scarcity of essential commodities

Inefficiency in raising the level of savings

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TRADE DEFICIT DURING PLAN PERIOD

(Rs. Crores)

First plan Second Plan

Third Plan Fourth plan Fifth plan Sixth plan Seventh plan Eight plan Ninth Plan Tenth Plan

2000 2340
2380 1560 3180 28100 36134 62400 75000 52000
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THE MINIMUM AGENDA FOR THE ACHIEVEMENT OF PLAN OBJECTIVES

Reduction of Centrally Sponsored Schemes

Expansions of project-based support to states Support to states contingent upon agreed programme of reforms Preference to the completion of existing projects than to new ones Plan funds to be given for critical repairs and maintenance activities Privatisation/closure of non-strategic PSUs in a time bound manner Reduction in subsidies in a time bound manner Selected fiscal targets to be achieved Tax reforms and implementation of VAT in a time bound manner
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AGENDA..

Legal and procedural changes to facilitate quick transfer of assets

Reforms of labour laws Reconsideration of policies affecting small scale sector Reforms and strengthening of judicial system

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OBJECTIVES OF 11TH FIVE YEAR PLAN

Income & Poverty

Accelerate growth rate of GDP from 8% to 10% and then maintain at 10% in the 12th Plan in order to double per capita income by 2016-17 Increase agricultural GDP growth rate to 4% per year to ensure a broader spread of benefits Create 70 million new work opportunities. Reduce educated unemployment to below 5%. Raise real wage rate of unskilled workers by 20 percent. 16 Reduce poverty by 10 percentage points

.11th Five Year Plan

Education

Reduce dropout rates of children from elementary school from 52.2% in 2003-04 to 20% by 2011-12.

Develop minimum standards of educational attainment in elementary school, and by regular testing monitor effectiveness of education to ensure quality.
Increase literacy rate for persons of age 7 years or more to 85%. Lower gender gap in literacy to 10 percentage points. Increase the percentage of each cohort going to higher education from the present 10% to 15% by the end of the 17 11th Plan.

.11th Five Year Plan

Health

Reduce infant mortality rate (IMR) to 28 and maternal mortality ratio (MMR) to 1 per 1000 live births. Provide clean drinking water for all by 2009 and ensure that there are no slip-backs by the end of the 11th Plan.

Reduce malnutrition among children of age group 0-3 to half its present level.
Reduce anemia among women and girls by 50% by the end of the 11th Plan. 18

.11th Five Year Plan

Women and Children

Raise the sex ratio for age group 0-6 to 935 by 2011-12 and to 950 by 2016-17. Ensure that at least 33 percent of the direct and indirect beneficiaries of all government schemes are women and girl children. Ensure that all children enjoy a safe childhood, without any compulsion to work.
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.11th Five Year Plan

Infrastructure

Ensure electricity connection to all villages and BPL households by 2009 and round-the-clock power by the end of the Plan. Ensure all-weather road connection to all habitation with population 1000 and above (500 in hilly and tribal areas) by 2009, and ensure coverage of all significant habitation by 2015. Connect every village by telephone by November 2007 and provide broadband connectivity to all villages by 2012. Provide homestead sites to all by 2012 and step up the pace 20 of house construction for rural poor to cover all the poor by 2016-17.

.11th Five Year Plan

Environment
Increase forest and tree cover by 5 percentage points. Attain WHO standards of air quality in all major cities by 2011-12. Treat all urban waste water by 2011-12 to clean river waters. Increase energy efficiency by 20 percentage points by 201617.
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