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Economic Planning by SSC
Economic Planning by SSC
Economic planning is a resource allocation mechanism that is contrasted with market mechanism.
Central Planning : refers Planned economy when we Plan the output too
Decentralized Planning means which is based on collective decision making and disaggregated
information.
2) Superior Decision
6) Improvement in BOP
7) Balanced economy
9) Overpopulation
There was a general consensus on one point that ‘the government’ should plan for the
development, not the private sector.
Great depression in Europe, Post WW2 reconstruction of the world + spectacular economic
growth against heavy odds in the Soviet Union in the 1930s and 1940s contributed to this
consensus.
National Planning Committee’ was established under the chairmanship of Nehru by INC.
Its recommendations could not be implemented because of the beginning of the Second World
1938 War
1950 ‘Sarvodaya Plan’ was given by J P Narayan – based on Vinoda bhave’s philosophy
Planning Commission (as an advisory body to the government) was set up in 1950 by a
Prime minister was the ex officio chairman of the planning commission assisted by a deputy
chairman. It included 6 union cabinet ministers as its ex officio members. There was also a
member secretary.
The planning commission was an autonomous body, which worked closely with union and
state cabinets and had full knowledge of their policies. Institutionally it was a part of the
cabinet organization and the ‘demands for grants’ for the PC was included in the budget for
the cabinet secretariat.
III. Its main focus was on the agricultural development of the country.
IV. This plan was successful and achieved growth rate of 3.6% (more than its target)