Economics

Planning

Meaning:

Planning is a technique, a means to an end being the realization of certainpre-determined and well-defined aims and objectives laid down by a central planning authority. The end may be to achieve economic, social, political or military objectives.

Definitions:

Economic Planning is “collective control or suppression of private activities of production and exchange”.
-Robbins
“Economic Planning in the widest sense is the deliberate direction by persons in-charge of large resources of economic activity towards chosen ends”.
-Dalton

Economic Planning in India:

Consists of economic decisions,schemes formed to meet certain pre-determined economic objectives and a road map of directions to achieve specific goals within specific period of time. The current thinking of economic planning is fairly new, somewhat rooted in Marxist socialism. In the 20th century,intellectuals, theorists, thinkers from
Europe put forward the idea of state involvement to stop capitalism and the
inequality of society. Soviet Union adopted economic planning for the first time in 1928
that enabled the country to turn into an industrial superpower. The idea of economic planning was strengthened during the Great Depression in 1930s.The outbreak of the World War II also required adequate and suitable planning of economic resources for the effective management after the effects of post war economy.
After Independence, in 1948, a declaration of industrial policy was announced. The policy suggested the creation of a National Planning Commission and the elaboration of the policy of a mixed economic system. On January 26, 1950, the Constitution came into force. In logical order, the Planning Commission was created on March 15,1950 and the plan era began on April 1,1951 with the launch of the first five year plan (1951-56). The evolution of planning in India is stated below:
1. Sir M. Vishveshwarya (1934): a prominent engineer and politician made his first attempt in laying foundation for economic planning in India in 1934 through his book, “Planned Economy of India”. It was a 10 year plan.
2. Jawaharlal Nehru (1938): set-up“National Planning Commission” by a committee but due to the changes in the political era and second World War, it did not materialize.
3. Bombay Plan (1940): The 8 leading
industrialists of Bombay presented“Bombay Plan”. It was a 15 Year Investment Plan.
4. S. N Agarwal (1944) gave the “Gandhian
Plan” focusing on the agricultural and rural economy.
5. M.N. Roy (1945) drafted ‘People’s Plan”. It was aiming at mechanization of agricultural production and distribution by the state only.
6. J.P. Narayan (1950) advocated,“Sarvodaya Plan” which was inspired by Gandhian Plan and with the idea of Vinoba Bhave. It gave importance not only for agriculture, but encouragedsmall and cottage industries in the plan.

After considering all the plans, in the same year Planning Commission was set up to formulate Five Year Plan inIndia by Jawaharlal Nehru. He was the first Chairman of Planning Commission,Government of India.

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