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Planning has been subject to a number of criticisms right since its inception in the country. With the passage of time, not only the number of criticism increased, but more importantly the shortcomings of planning were pointed out. Although after considerable delay, the governments took note of the shortcomings besides taking some major steps. The criticisms stand even today, but with one difference that the government is not only conscious of them but also trying to do away with them. We may briefly discuss the major criticisms of planning in India as well as the follow ups from the government to do away with them as under:
1. Lack of ‘Perspective’ in Planning
According to experts, if a nation is going for economic planning it must have ‘perspective’ element in it. To have perspective in planning, two basic elements need to be fulfilled, namely—
(i) Planning should be evaluation-based, and
(ii) ‘Long-term’ goals should be followed up besides the ‘short-term’ goals.
In the Indian content, the succeeding plans have been always commenced without the full evaluation of the preceding Plan. This was mainly due to the following reasons:
(a) Lack of a nodal body responsible for data collection at the national level;
(b) Federal nature of polity made data collection full of delays and also due to higher dependence on the states; and
(c) Speedier data delivery was not possible.
After the recommendations of the National Statistical Commission (Chaired by C. Rangarajan), 2000, the government discussed to set up a nodal body for data collection at the pan-India level, cutting across federal hurdles. Computerisation is already being done for speedier data delivery. For the time being the Plans are launched on the basis of projected data (provisional, latest, etc.), which is almost near the real data. But once the above discussed arrangements are in place, Indian planning will be based on evaluation, undoubtedly. In the meantime, the ‘Quarterly Review’ and the ‘Performance Budgeting’ of the Union Budgets have brought in the evaluation element to a greater degree.
The First Plan had set long-term goals (for the coming 20 years) besides the short-term goals (for five years). But over the time, falling confidence in mobilising required resources and political uncertainties at the Centre made it a convention to set only short-term targets of planning. This shortcoming seems to be done away with after the commencement of the Tenth Plan. The Plan did not go for setting long-term goals only, but even did set monitorable targets for the Eleventh Plan, too.
Point should be noted here that the government had been conscious about the need for perspective planning as a separate division with the same name, which has been functioning in the Yojana Bhavan since the mid-1970s.
2. Failure in Promoting a Balanced Growth and Development
Indian planning is blamed for failing the objective of a regionally balanced growth and development. Though the Second Plan itself had noticed this fact, the measures taken were not sufficient or were short-sighted. Economic planning at the national level has proved to be a highly effective tool of promoting balanced growth. But in the Indian case it turned out to be the opposite.
To take care of the issue of balanced growth, the planning process has been using the right tools, i.e., allocating plan funds on a sectoral (primary, secondary and federal reasons) basis. But due to political reasons, enough discrepancies cropped up in the method of allocating funds to the states. At the theoretical level, the governments knew the remedies, but at the practical
levels politics dominated the planning process. Democratic immaturity and politicisation of the planning process is to be blamed for this.
Now things have changed for the better. The government is following a two-pronged strategy to achieve the objective of a balanced growth and development in the country:
(i) Backward regions today are prioritised in directing the Central Government investment (very much the same since the 1950s), but a new beginning in the ‘differential development strategy’ has been made by the Centre with the Tenth Plan. Under this strategy, the developmental constraints of different states are to be tackled with a differentiation in the strategy. The more needy states get more funds and assistance from the Centre for their planned development, cutting across the political party lines (it is seen today as a symbol of political maturity on the issue of economic development, at least).
(ii) There is also a complementary strategy of the planning to address the matter of regional imbalance in the country. After the country started the process of economic reforms, the nature of planning was to incline more and more towards indicative planning. The economy was to be more and more dependent on private sector investment for its future development. And the private sector will be, naturally, more interested in investing in the regions, which have better infrastructure support. Since the developed regions have better infrastructure they will attract the highest level of private investment, which will again accelerate the process of imbalanced growth. To tackle this problem, the Centre is promoting the states with lower, infrastructure so that they can overcome the disadvantage. The process is slower, but at least the government is addressing the issue, which is not less satisfying and there is no criticism to this strategy. Still balanced growth and development is going to be a great challenge for planning in India.