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Chapter – 3
Politics of Planned Development

Economic Development in Independent India

• Soon after the Independence, India had to take a number of decisions regarding
development.
• Almost every one agreed that the development should mean both economic growth and
socio-economic justice.
Ideas of Development
• A lot of debates on the issue of development took place like – to take the Western countries
as the standard for measuring development.
Models of Modern Development
1. Capitalist Model – America and co followed it.
2. Socialist Model: Soviet Union and co followed it.
• India opted Mixed Economy – equal importance to public sector and private sector.
Planning
• Father of Indian Planning – M. Visvesuaraya.
• Famous book – “Planned Economy for India”.
Objectives of Planning
• Proper utilization of economic resources.
• Attainment of a fixed goal in a definite time period.
• Fulfilment of the basic needs of the society such as shelter, food and cloth etc..,
Planning Commission
• Set up in march 1950 by a resolution of the government of India.
• Its chairman is PM.
• Deciding the strategy of planning for development.
• Consist of both political and non-political men.
Functions of Planning Commission
• Allocation of resources on the priority.
• Effective utilization of the resources.
• To assess the material, capital and human resources.
• Successful implementation of each stages of plan.

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NITI Aayog
• It means National Institution for Transforming India.
• NDA government abolished the Planning Commission and introduced a new institution
called NITI Aayog.
• Officially it came in to existence on 1st January 2015.
Five Year Plans
• The planning Commission formulated Five Year Plan for the economic development of
India.
First Five Year Plan (1951 – 56)
• Drafted by Dr. K.N Raj.
• Priority to the agricultural sector.
• The policy of Hasten slowly – opted in the developmental process.
• It allocated huge funds for large scale projects like Bhakra Nankal and Hirakund dams.
Second Five Year Plan (1956-61)
• Drafted by P.C Mahalanobis.
• It is also called Mahalanobis’ Plan.
• Priority to industries.
• Aim was to change the pace of industrial development.
• Heavy industries were established like Steel industries in Bhilai and Durgapur.
Key Controversies
1. Agriculture Versus Industry
Supporters of Agriculture
• Stress on an agrarian strategy for development.
• Demanded stable agricultural sector.
• Proposed rural industrialisation’
Supporters of Industry
• Eradication of poverty is possible only through the rapid industrialisation.
• Youth must be given more employment opportunities.
2. Public Sector Versus Private Sector
Supporters of Public Sector
• No much investment in the sphere of education and health care.
• State was in favour of private sector.
• State involved in the sphere only where the private sector not shown much interests.

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Supporters of Private Sector

• Not given enough space to grow.
• Many hurdles like licences and permits.
Major Outcomes of Planning
Positive outcomes
• Laid down very good foundations for India’s economic growth.
• Huge projects were initiated like dams, power generation projects, steel plants etc..,
• land reforms like ceiling on agriculture land, abolition of Zamindari system etc...,
Negative outcomes
• Food crisis subsequently led to acute and wide spread malnutrition.
• Death rate increased due to famine and droughts.
The Green Revolution
• Master brain – Dr. M.S Swaminathen, father of Indian Green Revolution.
• Helped a lot for agricultural development and food grain production.
• To increase the food production, government of India offered high yielding variety seeds,
fertilizers, pesticides etc.., at subsidy rate.
• Negative Impacts: Major beneficiaries were the rich peasants and large land holders.
• Increased the gap between poor peasants and large land holders.
• Positive Impacts: Rice production and wheat production enhanced.
• Sugar and wheat became main crops as a result of Green Revolution.
The White Revolution
• Mater brain – Varghese Kurian, Milk Man of India.
• It was a dairy Co-operative Movement.
• The pattern became a model for rural development and poverty alleviation.
• It doubled the milk production and hiked the regular income.
• Laid foundation to the self reliance.
• It increased the job opportunities.
Later Developments
• Indira Gandhi emerged as a popular leader.
• She strengthened the role of the state in controlling and directing the economy.
• Main developmental programmes after 1967 were:
1. Restrictions on private sector.
2. 14 banks were nationalised.

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3. Number of pro-programmes.
• These changes were accompanied by an ideological tilt towards socialist policies.
JOBY JOHN
SJHSS Palavayal, KGD