NITI AAYOG: Civil Services Mentor Magazine - April - 2015

NITI AAYOG: PM Chairs first meeting of Governing Council of NITI AAYOG

Indian economy after the independence was weak and political class at that time felt the need for a planned economy. Policy makers believed that Russian model of planned economy would be the best possible way to tackle the problem of poverty, illetracy, high mortality and low life expectancy etc. There are twelve five year plans which are made till now and every plan has a specific objective. Main focus of the first plan was agriculture, irrigation and power likewise second plan focussed on industrialisation and especial focus on heavy industry. Present plan which runs for the period of 2012-17 has a theme of “Faster, More inclusive and sustainable growth”. Five year plans have been able to achieve various targets like poverty reduction, decrease in mortality rate, and improvement of various social indicators.

But there are various changes which Indian economy has seen since independence. Notable changes among them are change in demography population of India has increased three fold to 121 crores and there is large number of working population below the age of 35 years. Similarly Indian economy has seen major changes from a small economy of 10,00 crore it has reached to 100 lakh crore in current price and structure of economy has also changed agriculture now constitute only 14% of the gdp. Further the role of government in economy has changed a lot from economy of weak private sector our private sector has matured now. Role of states has also changed now the States of the Union of India have evolved from being mere appendages of the Centre, to being the actual drivers of national development. So the one-size-fits-all approach, often inherent in centralized planning, is no longer practical or efficient. Technology and information access have helped integrate different capabilities of our regions, states and eco-systems towards an interlinked national economy. To reap the benefits of the creative energy that emerges from the Indian kaleidoscope, our development model has to become more consensual and co-operative. Some critisms has also been recieved by planning commission like-

  • Failure in vastly improving the socio-economis indicators of the country, around 30 crore poor still live in India and India is among the lowest ranking nations in terms of social indicators like amlnutrition etc.

  • Centrally sponsered schemes were criticized for “one size fits all approach”, only in 2013 flexibilty has been given to the states.

  • Government for may years worked as provider of first and last resort but in current economic situation of the world this is not the best policy.

  • Due to emergence of other institutions like Prime ministers economic advisory committee role of planning commission has been reduced.

  • India has undergone a paradigm shift over the past six decades - politically, economically, socially, technologically as well as demographically. New institution is required to full fill the wishes of people of India.

  • In order to overcome all those challenges in the planning commission and in the need of the changing times government has transformed planning commission into National Institution for Transforming India. The very first plan after the liberalisation of 1991 - itself categorically stated that, as the role of Government was reviewed and restructured, the role and functions of the Planning Commission too needed to be rethought. The Standing Committee on Finance of the 15th Lok Sabha observed in its 35th Report on Demand for Grants (2011-12) that the Planning Commission “has to come to grips with the emerging social realities to re-invent itself to make itself more relevant and effective for aligning the planning process with economic reforms and its consequences, particularly for the poor”.

  • The new institution will be a catalyst to the developmental process; nurturing an overall enabling environment, through a holistic approach to development going beyond the limited sphere of the Public Sector and Government of India. New institution will work on following lines:

  • It will act as a knowledge hub of internal as well as external resources and a Think Tank offering domain knowledge as well as strategic expertise to all levels of government.

  • A collaborative platform facilitating Implementation; by monitoring progress, plugging gaps and bringing together the various Ministries at the Centre and in States, in the joint pursuit of developmental goals.

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