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Since the NITI was set up, replacing the erstwhile Planning Commission, these have been much confusion regarding several aspects of development planning in the country. Some of them have been analysed here in the pursuit of searching a settled position:
(i) About the fate of planning: A state of confusion has been there whether the Gol will stop launching the Five Year Plans? The earliest official word regarding it came from the Finance Minister himself when he was enquired about it by media while he was going to attend the 1st meeting of the Governing Council of the NITI Aayog on February 8, 2015. He gave inconclusive answers to media—it was yet undecided whether India will be involved in planning in future.
(ii) What in place of Plans?: Some hints regarding it came from the Vice Chairman (Arvind Panagariya) of the NITI Aayog itself in his interaction with the media (by early March 2016). According to him, the Government may not be going for the five year plans after the 12th Plan
—it may be replaced by a medium-term fiscal framework that will project revenue and expenditure allocations for the next three years beginning 2017–18. In this process the last two years of the 12th Plan (2012–17) will be used as transition. He further added that to introduce
medium term fiscal framework may entail some sense of prediction what the next two or three years, what the revenues are likely to be, how the resulting expenditure will be allocated across different ministries. In his opinion, if the funds are allocated to a ministry then there should be some sense of responsibility to deliver. At the end of the year there will be an assessment. Under the current Five Year Plan system, the review of implementation is done mid-way through the plan and sometimes targets are revised.
It should be noted that the Union Budget 2016–17 has already announced about doing away with the classification of Plan and Non- Plan expenditures in the backdrop of 2016–17 being terminal year of the 12th Plan period (2012–17). In future, the expenditures of the Gol will be classified as Revenue and Capital—it has been already used by the 14th Finance Commission (Development and Non-development classification was used by India till 1986-87). Meanwhile, the 15-year ‘Vision Document’ (in place of the 13th plan) is supposed to be released by the NITI Aayog any time till end-March so that it could get effective from April 2017.
(iii) Actual role of the NITI Aayog: Much confusion remains whether the body is an ‘institution’, a ‘think tank’ or an ‘organisation’. On this, the NITI Aayog Vice Chairman said that if Plans are replaced by medium- term fiscal framework then the Aayog will be an agency to mediate this. He further added—the Finance Ministry will deal with finances and other ministry will deal with the action, but besides both of these somebody must do planning of expenditure—most importantly ex-post assessment of delivery. As per him, the Aayog will provide policy support and monitor.
(iv) Fund allocation: The Planning Commission used to have the highest say in the area of fund allocation (to the Central Plans, Central Sector Schemes, Centrally Sponsored Schemes, Additional Support to States, etc.). Will this role be played by the NITI Aayog? With passing times the experts have come to believe that the ultimate power to allocate funds will rest with the Finance Ministry, but the amount of funds, funding patterns, etc., will be decided by the Governing Council of the Aayog following the guiding principle of ‘co-operative federalism’. In a sense,
states and UTs will be sitting in the capacity of decision makers as how much funds they should be given! Suppose it works as per the design, it will really lead India towards setting the new examples of federal co- operation and the emergence of Team India.
(v) About the state plans: Together with the Centre, it is believed that the states will also stop launching their five year plans and will replace them by the similar medium-term fiscal framework. It will be necessary for the purpose of integrating the developmental actions by both the governments.
(vi) The Unique Identification Authority of India (UIDAI): In September 2015, the body, which issues Aadhaar (a 12-digit individual identification number), was shifted to the Ministry of Communication and Information Technology from NITI Aayog. It used to be an attached body of the erstwhile Planning Commission. The decision has been taken keeping in mind the government’s ambitious ‘Digital India’ programme as the Aadhaar numbers are being linked with several services.
The issuance of Aadhaar cards, started by the then UPA government, has come under the scrutiny of the Supreme Court, which held (mid-2015) that the card would not be mandatory for availing benefits of government’s welfare schemes. In wake this, the Union Budget
2016–17 announced to support the Aadhar by an Act of the Parliament. Accordingly, the Aadhaar (Targeted Delivery of Financial and other Subsidies, Benefits and Services) Act, 2016 has been enacted which provides the Aadhaar a statutory backing and make it the mainstay of the government’s direct benefit transfer (DBT) programme for the disbursal of the various subsidies.
Meanwhile, certain other related issues are still there to be settled - the National Development Council (NDC); the Independent Evaluation Office (IEO); the Programme Evaluation Organisation (PEO). The possible ways to settle them have been discussed in this chapter itself at relevant places.
1 . J.K. Galbraith, A History of Economics, (London: Penguin Books 199), p. 187.
2 . Bipan Chandra, ‘The Colonial Legacy’, in Bimal Jalan (ed.), The Indian Economy: Problems and Prospects, (New Delhi: Penguin books, 2004).
3. Arjun Sengupta, ‘The planning Regime since 1951’ in N.N. Vohra and Sabyasachi Bhattacharya (eds), Looking Back: India in the Twentieth Century (New Delhi: National Book Trust, 2001), p. 121.
4. Planning Commission, Seventh Five Year Plan (1985–90), (New Delhi: Government of India), 1985.
5. Planning Commission, The 8th, 9th, 10th and 11th Plans, New Delhi: Government of India.
6 . Sumit Sarkar, Modern India: 1855–1947, (New Delhi: Macmillan, 1983), pp. 360–
361.
7. Bipan Chandra etal., India After Independence, 1947–2000, (New Delhi: Penguin Books, 2000), p. 341.
8. A. Vaidyanathan. ‘The Indian Economy Since Independence (1947–70)’, in Dharma Kumar (ed), The Cambridge Economic History of India, Vol.II, (Cambridge: Cambridge University Press, 1983), p. 949.
9. Sumit Sarkar, Modern India, p. 360.
10. Publications Division, The Gazetteer of India, Vol.3, (New Delhi: Government of India, 1975), p. 2.
11. Ibid., pp. 2–3.
12. There was a popular view in favour of rapid industrialisation among the important nationalists, economists and the business class of that time.
13. The Board was set up by the Interim Government formed in 1946.
14. Dharma Kumar (ed.), The Cambridge Economic History of India, Vol.II, p. 950.
15. Kalikinkar Datta, An Advanced History of India, 4th Edition (New Delhi: Macmillan, 2006), pp. 955–56.
16. S.N. Jha and P.C. Mathur (eds), Decentralisation and Local Politics, (New Delhi: Sage Publications, 2002), pp. 28–30.
17. A. H. Hanson, The Process of Planning: A Study of India’s Five-Year Plans, 1950– 1964 (london: Oxford University Press, 1966), pp. 152–55.
18. Bipan Chandra, ‘The Colonial Legacy’, p. 23.
19. Partha Chatterjee, ‘Development Planning and the Indian Planning’, in Partha Chatterjee (ed.), State and Politics in India (New Delhi: Oxford University Press, 1997), p. 273.
20. Rakesh Mohan, ‘Industrial Policy and Contorls’, in Bimal Jalan (ed.), Indian Economy: Problems and Prospects (New Delhi: Penguin Books, 1994).
21. Bipan Chandra, ‘The Colonial Legacy’, pp. 23–31.
22. Dharma Kumar, The Cambridge Economic History of India, p. 949.
23. Partha Chatterjee, ‘Development Planning and the Indian Planning’, p. 275.
24. S.K. Ray, Indian Economy (New Delhi: Prentice Hall, 1987), p. 369.
25. A.H. Hanson, The Process of Planning, p. 175.
26. George Mathew, Power to the People, in
M.K. Santhanam (ed.), 50 Years of Indian Republic (New Delhi: Publications Division, Government of India, 200), p. 32.
27. L.C. Jain, et al., Grass Without Roots (New Delhi: Sage Publications, 1985).
28. A. H. Hanson, The Process of Planning, p. 180.
29. Publications Division, The Gazatteir of India, p. 5.
30. Ibid., p. 5.
31. Ibid.
32. Ibid., pp. 7–10
33. Ibid.
34. Deputy Chairman, Planning Commission, May 1999. It is interesting to note here that the composition of the polity in the Centre was dominated by the BJP, while the Deputy Chairman, Planning Commission was
K.C. Pant (an old congress man)—continuity in the basic ideas and objectives of planning being maintained.
35. Publications Division, India (New Delhi: Government of India, various years).
36. Duely discussed by the NPC as well as the Constituent Assembly.
37. National Planning Committee Report; Also Nehru in The Discovery of India.
38. The Preamble was declared by the Supreme Court as an integral part of the Constitution and any amendments amounting to a change in its meaning and spirit amounted to the violation of the ‘basic feature’ of the Constitution (Keshvanand Barti, 1973 and S.R. Bommai, 1994 cases). This further magnified the objectives and role of Planning in India.
39. As the different Articles of the Directive Principles got interpreted as being complementary parts of the Fundamental Rights, their enforcement became obligatory for the Government in coming times, still broadening the objectives of planning in the country.
40. Distribution of Legislative Power, List-III, Entry 20.
41. Though formal planning commenced in the fiscal 1951–52, planning has already commenced with the Industrial Policy Resolution, 1948. More so, the Prime Minister of India who headed the NPC had already taken firm decision that India
would be a planned economy by August 1937 (Congress Working Committee, Wardha). Thus, the economy takes its first wink in the planned era!
42. Alan W. evans, ‘Economic and Planning’, in Jean Forbes (ed.), Studies in Social Science and Planning (Edinburgh: Scottish Academy Press, 972), p. 121.
43. I. Publications Division, The Gazetter of India, p. 10.
II. S.R. Maheshwari (Indian Administration New Delhi: Orient Longman, 2002, p. 121).
III. (‘The Indian Economy Since Independence’, p. 949).
44. The post of Deputy Chairman was later given a Cabinet rank in the Union Council of Minister.
45. Publications Division, Gazetteer of India, p. 11.
46. Publications Division, India 2008 (New Delhi: Ministry of Information and Broadcasting, Govrnment of India, 2009), p. 676.
47. There was a provision of only three Cabinet Ministers as its ex-officio members namely the Finance, Human Resource Development and Defence upto July 2004 when the United Progressive Alliance Government increased it to include the other three Cabinet Ministers, viz., the Railways, Agriculture and Information Technology. It has been only once in the history of the PC that it had six Cabinet Ministers as its ex-officio members, i.e., in the final years of the Rajiv Gandhi regime (The Economic Times, 16 July 2004, N. Delhi Edition).
48. Publications Division, Gazetteer of India, p. 11.
49. Prima facie a body should have been either constitutional or statutory to wield the executive powers, but as a number of Cabinet Ministers as well as the PM himself were directly involved with the PC, it used to weild executive powers for all practical purposes.
50. Rajamannar was the Chairman of the Fourth Finance Commission. See Ministry of Finance Report of the Fourth Finance Commission (New Delhi: Government of India, 1965) pp. 88–90.
51. By the 1950s it was a general criticism of the PC which looked highly logical. But through the entire period of planning the Government never did think to convert the PC into a constitutional body. Practically enough, the Union Cabinet and the whole Government is accountable to the Parliament for the functions of the PC as it has complete mandate and support of the governments of the time.
52. Appleby, Public Administration in India: Report of A Survey, Ford Foundation, 1953, p. 22.
53. As quoted in D.D. Basu, An Introduction to the Constitution of India (New Delhi:
Wadhwa & Company, 1999), p. 330.
54. Publication Division, The Gazetteer of India, Vol. 3, op.cit., pp.10–11.
55. It is not without that the Government decides to call in Montek Singh Ahluwalia, an economist of international repute to officiate as the Deputy Chairman of the PC. Every idea and opinion of Mr. Ahluwalia was understood by the coalition partners of the UPA Government as a thing the Government is necessarily going to implement in future. One can imagine the increased role of the office of the PC. There is always a hue and cry every time the Deputy Chairman articulates an idea or opinion. Though the PC is chaired by the PM, it seems that the Deputy Chairman has started availing enough autonomy to speak his mind.
56. Ibid.
57. As per the original mandate, the PC was supposed to formulate the state plans also. By 1960s, with the decision to follow the multi-level planning (MLP) in the country the states started having their own state planning boards (SPBs).
58. In setting these targets the concerned states were consulted approach of planning was followed.
59. Cabinet Secretariat, Resolution No. 62/CF/50 (06.08.1952) Government of India, New Delhi.
60. Planning Commission, First Five year Plan: A Draft Outline (New Delhi: Government of India, 1957), p. 253.
61. Publications Divisions, The Gazetteer of India, p. 10.
62. The Advisory Planning Board (1946) set up by the Interim Government had suggested for such a consultative body with the representatives from the provinces, the princely states and some other interests to advise the Planning Commission for the success of planning in India.
63. Other than the Cabinet Resolution, it is also quoted is The Gazetteer of India
(Publications Divsion, The Gazetteer of India, p. 15).
64. The italicised words are here highlighting the level of the Government’s consciousness about the concerned issues of decentralised planning, regional and individual inequalities to which the planning was to be specially attentive.
65. George Mathew, undoubtedly among the legendary commentator on the Panchayat Raj/democratic decentralisation calls Nehru as “its most eminent champion at the national level”. Similarly, the reputed historians Bipan Chandra and others call Nehru as “the greatest champion of planned economic development”. For Nehru the process of planning in the country was to be democratic about which seems very clear, as his writings support.
66. Sukhomoy Chakravarti, Development Planning: The Indian Experience (New
Hork: Oxford University Press, 1989), pp. 9–11.
67. C. Rangarajan, Indian Economy: Essays on Money and Finance (New Delhi: UPSBD, 1998), p. 272.
68. It should be noted here that as per the official version of the Government of India, the planning has been a continuous process in the country and there is no term like ‘Plan Holiday’ in Its official documents. The term was given by the critics and popularised by the contemporary media.
69. Experts believe this Plan to be somewhat based on the ideas of D.P. Dhar, the Minister for Planning at that time.
70. N.N. Vohra Committee Report, Government of India, N. Delhi, 1993.
71 It should be noted here that there is nothing like the ‘Rolling Plan’ in the official documents of planning in India. Basically, the origin of the concept of the ‘Rolling Plan’ goes back to the period when India went for the Annual Plans (1966–69) for the first time and the critics noted it as a discontinuity in the planning process, calling it a period of the ‘plan holiday’. The basic trait of the ‘Rolling Plan’ was its continuity, while the Congress commenced its Sixth Plan (1980–85) the idea of the ‘Rolling Plan’ was cancelled, as for the new Government the element of ‘rolling’ (continuity) was already in the Indian Planning— India was following the approach of the ‘perspective planning’. A separate Division of Perspective Planning was already functioning in the Yojana Bhavan since the mid-1970s. The two elements which make a plan a ‘perspective plan’ are, firstly, the ‘continuity’ and secondly, ‘evaluation-based’ planning. For the Congress Government, logically, the planning in India was not only ‘rolling’ but more than that it was evaluation-based, too.
72. Some experts see this Plan as a symbol of the planning being converted to a complete politics—with utter populism entering into the planning process of India. The circle of the politicisation of planning gets completed with this Plan.
73. ‘Target group’ approach of planning is selecting the group of people where a particular problem is and attacking the problem directly. The TPP was the first such programme in India.
74. Publications Division, India 1980–1983 (New Delhi: Government of India).
75. Planning Commission, Seventh Five Year Plan (1980–85) (New Delhi: Government of India, 1980).
76. Similar financial strategy to promote growth and development had led the Soviet Union to economic collapse via the balance of payment crisis during Gorbachev’s regime by 1991, as is pointed out by Jeffrey Sachs in The End of Poverty ((London: Penguin Books, 2005), pp. 131–34).
77. C. Rangarajan, Indian Economy, p. 274.
78. Bimal Jalan in Bimal Jalan (ed.), 1992, pp. 190–191, op.cit.
79. This is the official version for the delay (Publications Division, India 2007 (New Delhi: Government of India, 2007), p. 680.
80. It should be noted here that the kind of economic reforms India started in 1991– 92 were almost ditto suggested by the Eighth Plan. The suggestions were based on India’s own experience and the experiences of the world economies after the Second World War. The Sixth and the Seventh Plans had suggested almost on the similar lines which made the Governments of the time go for the so-called ‘liberalisation’ moves in the mid-1980s
81. C. Rangarajan, Indian Economy, p. 275–276.
82. Publications Division, India 2007, pp. 682–83.
83. Ministry of Finance, Economic Survey (1998–200) (New Delhi: Government of India, Various Years); Publications Division, India 2007, p. 683.
84. Planning Commission, Tenth Five year Plan (2002–07), (New Delhi: Government of India).
85. Planning Commission, Mid-Term Appraisal of the Tenth Plan (New Delhi: Government of India).
86. For development works the MP, Lower House (the Lok Sabha) may select one or more districts of his/her constituency; the MP, Upper House (the Rajya Sabha) may select any one or more districts from his/her constituency (i.e., a state or an UT); and the nominated MPs may select any one or more districts from their constituency (i.e., the whole country).
87. As the Government reports in Publications Division, India 2007, pp. 711–12.
88. We may especially quote the ‘21 Point Memorandum’ handed over by the All India Panchayat Adhyakshas Meet, mid-2002, N. Delhi to the President and the Central Government of the time.
89. After the implementation of the 74th Constitutional Amendments they have become the District Planning Committees (DPCs).
90. While people in some areas have socio-cultural similarities (as in the hill areas with no tribal population and the people living in the plains, i.e., villages) they lack economic similarities. Similarly, while people living in the tribal areas and the hill areas have economic similarities they lack socio-cultural similarities. That is why all these three habitations had three sets of planning patterns.
91. G.V.K. Rao Committee (CAARD), 1985; L.M. Singhvi Committee (CCPPRI), 1986 and Sarkaria Commission, 1988 all discussed this inter-connection (Suresh Mishra,
Legislative Status of Panchayat Raj in India (New Delhi: Indian Institute of Public Administration, 1997).
92. Governments’ failure in including the local aspirations in the process of planned development has been considered by major experts as the foremost reason behind the success of the regional political parties, which has led to the governments of the ‘compromises’, i.e., coalition governments, at the Centre and in the states via the ‘hung parliaments’ and the ‘hung assemblies’, respectively.
93. Jose George, ‘Panchayats and Participatory Planning in Kerala’, The Indian Journal of Public Administration, Vol. XLIII, No.1, January–March 1997.
94. As K.C. Wheare writes about the classical federal constitutions in Federal Government (New Delhi: Oxford University Press, 1956), p. 97.
95. Articles 270, 273, 275 and 280 of the Constitution of India.
96. Ministry of Finance, Report of the Fourth Finance Commission, p. 88.
97. In the 10th Plan, Som Pal was that common member in both the Commissions (who resigned from the PC once the UPA-I came to power). But this arrangement has been followed by the government in all new Commissions since then—with
B. K. Chaturvedi and Prof. Abhijit Sen (Members, PC) being the Additional Members of the 13th and 14th Finance Commissions.
98. This should be considered a great fiscal freedom to the states (which even the constitution could not forsee) and also making them behave with more responsibility in fiscal matters. More than 20 states have passed their Fiscal Responsibility Acts (FRAs) by now and are borrowing from the market for their planned needs.
99. Planning Commission, Tenth Five Year Plan (New Delhi: Government of India, 2002).
100. While he was in India to receive the ‘Bharat Ratna’ award in 2001.
101. Planning Commission, Twelfth Five Year Plan (2012–2017), Vol. I – Inclusive and Sustainable Growth (New Delhi: Government of India, 2012), pp. 34–36.
102. Ministry of Finance, Economic Survey 2011–12 (New Delhi: Government of India, 2012), p. 30.
103. Ministry of Finance, Economic Survey 2012–13 (New Delhi: Government of India, 2013), p. 173.
104. Economic Survey 2011-12, MoF, GoI, N. Delhi, p. 30.
105. Ministry of Finance, Economic Survey 2012–13, p. 269.
106. An Independent Evaluation Office (IEO) functions in the International Monetary Fund (IMF) since 2001, which conducts independent and objective evaluations of
Fund’s policies and activities. Under its Terms of Reference, it is fully independent from the Management of the IMF and operates at arm’s length from the Board of Executive Directors with the following three missions—(i) Enhancing the learning culture within the Fund, (ii) Strengthening the Fund’s external credibility, and (iii) Supporting institutional governance and oversight (Source: Independent Evaluation Office, IMF, Washington DC, 2014).
107. Such a stance in the process of planning we find in the document of the 10th Plan (2002–07) for the first time when the government of the time (the NDA-led) made the call : ‘if states are developed, the nation is developed’. We find a pronounced shift towards ‘decentralised planning’ (the Plan was nicknamed as the ‘People’s Plan’). The new idea of ‘monitorable targets’ also commenced in this plan giving states more say and accountibility in the process of planned development (these targets were continued within the forthcoming Plans). Several other steps were also taken in this Plan aimed at bringing the states in the mainstream of the developmental process, viz., by giving them increased role and accountibility.