Planning Commission

The Planning Commission was set up by a Resolution of the Government of India in March
1950.
Objectives of the government while starting PC were the following:
• Promote a rapid rise in the standard of living of the people by efficient exploitation
of the resources of the country.
• Increase production.
• Offer opportunities to all for employment in the service of the community.
Jawaharlal Nehru was the first Chairman of the Planning Commission. It was a non-
constitutional and non-statutory advisory body. 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. The planning commission 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 were included in the budget
for the cabinet secretariat.
Members of the Planning Commission

• Chairman – Prime Minister; presided over the meetings of the Commission

• Deputy Chairman – de facto executive head (full-time functional head);
• Was responsible for the formulation and submission of the draft Five-Year Plan to the
Central cabinet.
• Was appointed by the Central cabinet for a fixed tenure and enjoyed the rank of a cabinet
minister.
• Could attend cabinet meetings without the right to vote.
• Part-time members – Some central ministers
• Ex-officio members – Finance Minister and Planning Minister

Planning Commission: Positives and Achievements

• PC laid emphasis on infrastructure developments and capacity building. As a result,

huge investments were made in education, energy, industry, railways and irrigation.

• India became self-sufficient in agriculture and made great progress in capital sector
goods and consumer sector goods.

• PC introduced many remarkable concepts like nationalisation, green revolution etc

and transformed itself to align with new concepts like liberalisation, privatisation
and inclusion.

• Planning commission made great emphasis on social justice, governance,

employment generation, poverty alleviation, and health and skill development.
 • The transformation of India from a poor to an emerging economic power is credited
to the orderly and phased manner in which planning was implemented.
Planning Commission: Negatives and Problems
There were many issues with planning methods followed in India.

• No structural mechanism for regular engagement with states.

• Ineffective forum for the resolution of centre-state and inter-ministerial issues.

• Inadequate capacity expertise and domain knowledge; weak networks with think tanks
and lack of access to expertise outside government.

• Failed to implement land reforms.

• It was a toothless body, was not able to make union/states/UTs answerable for not

• achieving the targets.

• Designed plans with ‘one size fit for all’ approach. Hence, many plans failed to show
tangible results.

• Weak implementation, monitoring and evaluation.

National Development Council

• It was founded in 1952 presided over by the PM.
• It was the apex body for decision making and deliberations on development matter
in India. It gave the final approval to the 5-year plans.
• It is neither a constitutional nor a statutory body.
• The Council is headed by the Prime Minister and all Union Cabinet Ministers, State
Chief Ministers, representatives of Union Territories; Members of Planning
Commission are its members.
• The Secretary/ Member-Secretary of Planning Commission functions as the Secretary
of the Council and all administrative assistance is rendered by Planning Commission.

The functions of NDC are

(i) to prescribe guidelines for formulation of the National Plan, including assessment of
resources for the Plan
(ii) to consider the National Plan as formulated by the Planning Commission
(iii) to consider important questions of social and economic policy affecting national
development and
(iv) to review the working of the Plan from time to time and to recommend such
measures as are necessary for achieving the aims and targets set out in the National
Plan.
• The prime function of the Council is to act as a bridge between the Union government,
Planning Commission and the State Governments.
• It is a forum not only for discussion of plans and programmes but also social and
economic matters of national importance are discussed in this forum before policy
formulation.

Niti Ayog
• National Institute for Transforming India is a Government policy think tank
established in 2015.

• It replaced the planning commission.

• Chairperson: Prime Minister of India

• Governing Council: Comprising the Chief Ministers of all States and Lt. Governors of
Union Territories.

• Regional Councils: Will be formed to address specific issues and contingencies

impacting more than one state or region.
Full-time Organisational Framework:

• Will comprise of, in addition to the Prime Minister as the Chairperson:

• Vice-Chairperson: to be appointed by the Prime Minister.

• Members: full-time: specialists with international exposure.

• Part-time Members: maximum of 2, from leading universities, research organizations

and other relevant institutions in an ex-officio capacity. Part-time members will be
on a rotational basis.

• Ex-Officio Members: maximum of 4 members of the Union Council of Ministers to be

nominated by the Prime Minister.

• Chief Executive Officer: to be appointed by the Prime Minister for a fixed tenure, in
the rank of Secretary to the Government of India.

• Secretariat: as deemed necessary.

• It has the dual objective of achieving sustainable development goals and to enhance
cooperative federalism with ‘bottom to top’ approach. Its initiatives include-
 Difference between Niti Ayog and Planning Commission
Planning Commission Niti Ayog

Enjoyed the powers to allocate funds to ministries and An advisory body, or a think-tank. The powers to
state governments. allocate funds might be vested in the finance ministry.

Had power to decide allocation of government funds No power to allocate funds

for various programmes at national and state levels.

Imposed policies on states and tied allocation of funds NITI is a think-tank and does not have the power to
with projects it approved. impose policies.

States' role was limited to the National Development State governments play a more significant role than
Council and annual interaction during Plan meetings. they did in the Planning Commission.

The commission reported to National Development Governing Council has state chief ministers and
Council that had state chief ministers and lieutenant lieutenant governors.
governors
Policy was formed by the commission and states were Consulting states while making policy and deciding on
then consulted about allocation of funds. funds allocation. Final policy would be a result of that.

Secretaries or member secretaries were appointment Secretaries to be known as the CEO and to be
through the usual process appointed by the prime minister.

The last Commission had eight full-time members Both full-time and part-time members

The core idea is that India has still not abandoned the process of planning and the
country still has planned development in action. However, the only difference is that the process
of planning is entirely different.
The first major difference is that instead of a single five-year plan, the country will
have three plans spread over three different time periods.

1. Vision Plan- 15 years: 15 year “Vision” that encompasses overall goals and objectives of
the country for next 15 years.
2. Strategy Plan- 7 years: 7 year “Strategy” which lays the roadmap of development for
next seven years dividing those goals and objectives into two parts.
3. Action Plan -3 years: “Three Year Action Agenda” which states the tasks and targets to
be accomplished in next three years’ time frame, further dividing the strategy into two
parts.