Economic Planning Economic planning is to make decision with respectto the use of resources. In communist countries the government makes bothmicro and macro economic decisions. Microeconomic decisions include what goods andservices to produce, the qualities to produce, theprices to charge, and the wages to pay. Macroeconomics decisions include the rate ofinvestment and the extent of foreign trade.
Need for Economic PlanningMess Poverty And Low Per Capital Income.High Rate Of Growth Of Population.Industrial Growth Was Negligible.Low Level Of LiteracyBackward TechnologyTraditional Attitude.Social And Economic Problem Created By Partition OfCountry.
Objective of Economic PlanningEconomic growthReduction of economic in equalitiesBalanced regional developmentModernizationReduction of unemployment
Planning commission of IndiaPlanning commission of India was setup in March 1950by government of India. The task before planningcommission of India are:-Effective utilization of resources.Prepare five year plan along with its objective.Coordination with state government of India forexecution of planDetermination of priorities, stages of plan and proposeof allocation of resources for due completion of stages.
Five year plansFirst Five-Year Plan (1951-1956)The 1st five year plan was presented by Jawaharlal Nehru,who was the Prime Minister during that period. It wasformulated for the execution of various plans between1951 to 1956. The Planning Commission wasresponsible for working out the plan The primary aim of the 1st five year plan was toimprove living standards of the people of India The target set for the growth in the gross domesticproduct was 2.1percent every year.
Second Five-Year Plan (1956–1961)The second five-year plan focused on industry,especially heavy industry. This plan particularlyfocused in the development of the Public Sector.Target Growth:4.5% Growth achieved:4.0%Third Five-Year Plan (1961–1966)The third plan stressed on agriculture andimprovement in the production of wheat, but thebrief Sino-Indian War of 1962 exposed weaknesses inthe economy and shifted the focus towards the‘Defense industry or Indian army’.Target Growth: 5.6% Actual Growth: 2.4%
Fourth Five-Year Plan (1969–1974)Indira Gandhi was the Prime Minister. The IndiraGandhi government nationalized 14 major Indianbanks and the Green Revolution in India advancedagricultureTarget Growth: 5.7% Actual Growth: 3.3%Fifth Five-Year Plan (1974–1979)The plan focused on employment, poverty alleviation,justice and self-reliance in agricultural production anddefenseTarget Growth: 5.23% Actual Growth: 45.3%
Sixth Five-Year Plan (1980–1985)The sixth plan marked the beginning of economicliberalization. Price controls were eliminated andration shops were closed.Target Growth: 5.2% Actual Growth: 5.4%Seventh Five-Year Plan (1985–1990)The main objectives of the 7th five-year plans were toestablish growth in areas of increasing economicproductivity, production of food grains, andgenerating employment.Target Growth: 5.0% Actual Growth: 5.7%
Eighth Five-Year Plan (1992–1997)1989–91 was a period of economic instability in India andhence no five-year plan was implemented. Between1990 and 1992, there were only Annual Plans.the country took the risk of reforming the socialisteconomy and launched Indias free market reforms.Target Growth: 5.6% Actual Growth: 6.78%Ninth Five-Year Plan (1997–2002)Main objective was to prioritize agricultural sector andemphasize on the rural development, to generateadequate employment opportunities and promotepoverty reduction, to stabilize the prices.Target Growth: 6.5% Actual Growth: 5.35%
Tenth Five-Year Plan (2002–2007) Reduction of poverty rate by 5 percentage points by2007. Providing gainful and high-quality employment atleast to the addition to the labor force. Reduction in gender gaps in literacy and wage rates byat least 50% by 2007.Target growth:8.1% Growth achieved:7.7%
Eleventh Five-Year Plan (2007–2012)INCOME AND POVERTYAccelerate growth rate of GDP from 8% to 10% andthen maintain at 10% in the 12th plan in order to doubleper capita income by 2016-17.Increase agricultural GDP growth rate to 4% per year.Reduce educated unemployment to below 5%.Raise real wage rate of unskilled workers by 20%
EDUCATIONReduce dropout rates of children from elementaryschool from 52.2% in 2003-04 to 20% by 2011-12.Increase literacy rate for persons of age 7 years or moreto 85%.Lower gender gap in literacy to 10% points.Increase the percentage of each cohort going to highereducation from the present 10% to 15% by the end ofthe 11th plan.
HealthProvide clean drinking water for all by 2009 andensure that there are no slip-backs by the end of the11th plan.Reduce malnutrition among children of age group 0-3to half its present level.Reduce anemia among women and girls by 50% by theend of the 11th Plan.
Women and ChildrenEnsure that at least 33% of the direct and indirectbeneficiaries of all government schemes are womenand girl children.Ensure that all children enjoy a safe childhood,without any compulsion to work.
InfrastructureEnsure electricity connection to all villages and BPLhouseholds by 2009 and round-the-clock power by theend of the plan.Connect every village by telephone by November 2007and provide broadband connectivity to all villages by2012.Provide homestead sites to all by 2012 and step up thepace of house construction for rural poor to cover allthe poor by 2016-17
EnvironmentIncrease forest and tree cover by 5% points.Attain WHO standards of air quality in all major citiesby 2011-12Treat all urban waste water by 2011-12 to clean riverwaters.Increase energy efficiency by 20% points by 2016-17.
ConclusionEconomic planning help in mobilizing and allocatingthe resources in desired manner.Objective of economic planning is to reduceinequality, economic growth, balanced regionalgrowth, modernization.Each five year plan aims to achieving certain target.Five year plan constitute the steps toward thefulfillment of objectives of economic planning. the 12th Plan has taken off, it is yet to be formallyapproved with the aim of the growth rateat 8%.