Economic Planning in India

1. ECONOMIC PLANNING:
RATIONALE, FEATURES AND
OBJECTIVES
Chandrika Soni
Assistant Professor
Department of Economics,
Gaya College, Gaya

2. INTRODUCTION
 In general, Planning is deciding in advance what is to be done,
when, where, how and by whom it is to be done.
 It includes the selection of objectives, policies, procedures and
programmes from among alternatives.
 Planning has been one of the pillars of our approach to
economic development since independence.
 Planning is not a static concept and each of the plans has
reflected the changing imperatives of the times.

3. ECONOMIC PLANNING
 Economic planning means state intervention in an economy, as
opposed to the free play of market forces. However, any form of
state intervention in an economy must not be confused with
planning. It may be noted that such governmental intervention
can be thought of as concerted, deliberate attempt of alternative
method of allocating economic resources to achieve some pre
determined goals either to replace/ supplement the market
mechanism.
 There is no agreement among economists with regard to the
meaning of the term “economic planning”.

4. CONTINUED
 This means allocation of limited resources among different
uses in such a way as to bring about the maximum welfare of
the people.
 It consists of two basic elements:
a) Determination of objectives (targets)
b) Provision of means for the achievements of the objectives.
 Thus, Economic Planning is an exercise of organizing and
utilizing scare resources and allocating them in accordance
with the pre-determined priorities so as to have maximum
social welfare within a specified period of time.

5. THE RATIONALE FOR PLANNING
 Limitation of the market mechanism.
 Need for social justice
 Resource mobilisation and allocation in the context of overall
development programme (i.e., the choice of development
projects has to be based on social benefits rather than private
profitability).

6. FEATURES OF PLANNING IN INDIA
 The main features of planning in India are:
a) Indicative Economic Planning
b) Indian Plans are comprehensive
c) Physical planning
d) Indian Planning has been Social Planning
e) Unreliable data

7. NEED FOR ECONOMIC PLANNING
 Backward Technology
 Industrial Growth was negligible
 Low level of Literacy
 High rate of growth of population
 Low per capita income
 Social and Economic problem created by partition of country.

8. OBJECTIVES OF ECONOMIC PLANNING
 Economic growth
 Reduction in income inequalities
 Balanced regional development
 Modernization
 Sizeable increase in national income and per capita income.
 Improve agricultural production
 Self reliance
 Elimination of poverty
 Removal of unemployment
 Inclusiveness and sustainability of growth

9. PLANNING COMMISSION OF INDIA
 Planning Commission was set up by Resolution of the
Government of India in March, 1950.
 The task before planning commission of India are:
a) Effective utilization of resources.
b) Preparing plans along with its objectives.
c) Coordinate with state government for execution of plan
d) Determination of priorities, stages of plan and purpose of
allocation of resources (i.e., increasing production, providing
employment opportunities, etc).

10. Thank you