Economic planning

ECONOMIC PLANNING ECONOMIC PLANNING IN INDIAIN INDIAOverviewOverview

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PLANNING COMMISSION AND PLANNING COMMISSION AND ITS FUNCTIONSITS FUNCTIONS To make an assessment of the material, To make an assessment of the material,

capital and human resources of the capital and human resources of the countrycountry

To investigate the possibilities of To investigate the possibilities of augmenting resources as are found to be augmenting resources as are found to be deficient in relation to the nation’s deficient in relation to the nation’s requirementsrequirements

To formulate plans for most effective and To formulate plans for most effective and balanced utilisation of country’s resourcesbalanced utilisation of country’s resources

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RATIONALE FOR PLANNINGRATIONALE FOR PLANNING

Inefficiencies of market mechanismInefficiencies of market mechanism

Need for social justiceNeed for social justice

Resource mobilisation and overall Resource mobilisation and overall development programmedevelopment programme

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PLANNING PROCESSPLANNING PROCESS

Planning bodyPlanning body Survey of resources and collection of Survey of resources and collection of

necessary datanecessary data Setting of planning objectivesSetting of planning objectives PrioritiesPriorities Development strategyDevelopment strategy Balancing actBalancing act Resource mobilisationResource mobilisation Administrative efficiencyAdministrative efficiency

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INDIAN FIVE YEARS PLANSINDIAN FIVE YEARS PLANS (SPECIAL FEATURES)(SPECIAL FEATURES)

Indicative economic planningIndicative economic planning ComprehensiveComprehensive Physical planningPhysical planning Indian planning is social planningIndian planning is social planning Exhaustive dataExhaustive data

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OBJECTIVES OF ECONOMIC OBJECTIVES OF ECONOMIC PLANNINGPLANNING Economic growthEconomic growth

Self relianceSelf reliance

Removal of unemploymentRemoval of unemployment

Reduction of income inequalitiesReduction of income inequalities

Elimination of povertyElimination of poverty

ModernisationModernisation66

STRATEGY OF ECONOMIC STRATEGY OF ECONOMIC PLANNINGPLANNING

Development of sound base for long Development of sound base for long term growthterm growth

High priority to industrialisationHigh priority to industrialisation

Emphasis on development of capital Emphasis on development of capital goods industriesgoods industries

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OBJECTIVES OF 10OBJECTIVES OF 10THTH FIVE YEAR FIVE YEAR PLANPLAN Reduction of poverty ratio by 5 percentage points by 2007; Reduction of poverty ratio by 5 percentage points by 2007;

Providing gainful and high-quality employment at least to Providing gainful and high-quality employment at least to the addition to the labour force; the addition to the labour force;

All children in school by 2003; all children to complete 5 All children in school by 2003; all children to complete 5 years of schooling by 2007; years of schooling by 2007;

Reduction in gender gaps in literacy and wage rates by at Reduction in gender gaps in literacy and wage rates by at least 50% by 2007; least 50% by 2007;

Reduction in the decadal rate of population growth between Reduction in the decadal rate of population growth between 2001 and 2011 to 16.2%; 2001 and 2011 to 16.2%;

Increase in Literacy Rates to 75 per cent within the Tenth Increase in Literacy Rates to 75 per cent within the Tenth Plan period (2002-3 to 2006-7); Plan period (2002-3 to 2006-7);

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Objectives……….Objectives……….

Reduction of Infant mortality rate (IMR) to 45 per 1000 live Reduction of Infant mortality rate (IMR) to 45 per 1000 live births by 2007 and to 28 by 2012; births by 2007 and to 28 by 2012;

Reduction of Maternal Mortality Ratio (MMR) to 2 per 1000 Reduction of Maternal Mortality Ratio (MMR) to 2 per 1000 live births by 2007 and to 1 by 2012; live births by 2007 and to 1 by 2012;

Increase in forest and tree cover to 25 per cent by 2007 and Increase in forest and tree cover to 25 per cent by 2007 and 33 per cent by 2012; 33 per cent by 2012;

All villages to have sustained access to potable drinking All villages to have sustained access to potable drinking water within the Plan period; water within the Plan period;

Cleaning of all major polluted rivers by 2007 and other Cleaning of all major polluted rivers by 2007 and other notified stretches by 2012; notified stretches by 2012;

Economic Growth to be further accelerated during this Economic Growth to be further accelerated during this period and crosses over 8% by 2006period and crosses over 8% by 2006

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Growth Strategy of 10th FYPGrowth Strategy of 10th FYP

More investor friendly flexible economic reforms More investor friendly flexible economic reforms Creation of congenial investment environment Creation of congenial investment environment Encourage private sector involvement Encourage private sector involvement Setting up state-of-the-art infrastructure Setting up state-of-the-art infrastructure Capacity building in industry Capacity building in industry Corporate transparency Corporate transparency Mobilizing and optimizing all financial resources Mobilizing and optimizing all financial resources Implementation of friendly industrial policy Implementation of friendly industrial policy

instruments instruments

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ECONOMIC GROWTHECONOMIC GROWTH per cent per cent per annumper annum

TargetTarget ActualActual1. First Plan (1951-56)1. First Plan (1951-56) 2.12.1 3.613.612. Second Plan (1956-61)2. Second Plan (1956-61) 4.54.5 4.274.273. Third Plan (1961-66)3. Third Plan (1961-66) 5.65.6 2.842.844. Fourth Plan (1969-74)4. Fourth Plan (1969-74) 5.75.7 3.303.305. Fifth Plan (1974-79)5. Fifth Plan (1974-79) 4.44.4 4.804.806. Sixth Plan (1980-85)6. Sixth Plan (1980-85) 5.25.2 5.665.667. Seventh Plan (1985-90)7. Seventh Plan (1985-90) 5.05.0 6.016.018. Eighth Plan (1992-97)8. Eighth Plan (1992-97) 5.65.6 6.786.789. Ninth Plan (1997-20029. Ninth Plan (1997-2002 7.07.0 6.06.010.Tenth Plan (2002-2007)10.Tenth Plan (2002-2007) 8.78.7 7.17.1 1111

RELATED PROBLEMSRELATED PROBLEMS

Scarcity of essential commoditiesScarcity of essential commodities

Inefficiency in raising the level of Inefficiency in raising the level of savingssavings

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TRADE DEFICIT DURING PLAN TRADE DEFICIT DURING PLAN PERIODPERIOD

(Rs. Crores)(Rs. Crores)

First planFirst plan 20002000Second PlanSecond Plan 23402340Third PlanThird Plan 23802380Fourth planFourth plan 15601560Fifth planFifth plan 31803180Sixth planSixth plan 2810028100Seventh planSeventh plan 3613436134Eight planEight plan 6240062400Ninth PlanNinth Plan 7500075000Tenth PlanTenth Plan 52000520001313

THE MINIMUM AGENDA FOR THE THE MINIMUM AGENDA FOR THE ACHIEVEMENT OF PLAN OBJECTIVESACHIEVEMENT OF PLAN OBJECTIVES

Reduction of Centrally Sponsored SchemesReduction of Centrally Sponsored Schemes

Expansions of project-based support to statesExpansions of project-based support to states

Support to states contingent upon agreed programme of reformsSupport to states contingent upon agreed programme of reforms

Preference to the completion of existing projects than to new onesPreference to the completion of existing projects than to new ones

Plan funds to be given for critical repairs and maintenance Plan funds to be given for critical repairs and maintenance activitiesactivities

Privatisation/closure of non-strategic PSUs in a time bound Privatisation/closure of non-strategic PSUs in a time bound mannermanner

Reduction in subsidies in a time bound mannerReduction in subsidies in a time bound manner

Selected fiscal targets to be achievedSelected fiscal targets to be achieved

Tax reforms and implementation of VAT in a time bound mannerTax reforms and implementation of VAT in a time bound manner 1414

AGENDA…..AGENDA…..

Legal and procedural changes to facilitate quick Legal and procedural changes to facilitate quick transfer of assetstransfer of assets

Reforms of labour lawsReforms of labour laws

Reconsideration of policies affecting small scale Reconsideration of policies affecting small scale sectorsector

Reforms and strengthening of judicial systemReforms and strengthening of judicial system

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OBJECTIVES OF 11OBJECTIVES OF 11THTH FIVE YEAR FIVE YEAR PLANPLAN

Income & PovertyIncome & Poverty

Accelerate growth rate of GDP from 8% to 10% Accelerate growth rate of GDP from 8% to 10% and then maintain at 10% in the 12th Plan in and then maintain at 10% in the 12th Plan in order to double per capita income by 2016-17order to double per capita income by 2016-17

Increase agricultural GDP growth rate to 4% Increase agricultural GDP growth rate to 4% per year to ensure a broader spread of benefitsper year to ensure a broader spread of benefits

Create 70 million new work opportunities.Create 70 million new work opportunities. Reduce educated unemployment to below 5%.Reduce educated unemployment to below 5%. Raise real wage rate of unskilled workers by 20 Raise real wage rate of unskilled workers by 20

percent.percent. Reduce poverty by 10 percentage points Reduce poverty by 10 percentage points

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………….11.11thth Five Year Plan Five Year Plan

EducationEducation Reduce dropout rates of children from elementary Reduce dropout rates of children from elementary

school from 52.2% in 2003-04 to 20% by 2011-12.school from 52.2% in 2003-04 to 20% by 2011-12.

Develop minimum standards of educational Develop minimum standards of educational attainment in elementary school, and by regular attainment in elementary school, and by regular testing monitor effectiveness of education to ensure testing monitor effectiveness of education to ensure quality.quality.

Increase literacy rate for persons of age 7 years or Increase literacy rate for persons of age 7 years or more to 85%.more to 85%.

Lower gender gap in literacy to 10 percentage points.Lower gender gap in literacy to 10 percentage points.

Increase the percentage of each cohort going to Increase the percentage of each cohort going to higher education from the present 10% to 15% by the higher education from the present 10% to 15% by the end of the 11th Plan.end of the 11th Plan.

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HealthHealth Reduce infant mortality rate (IMR) to 28 and maternal Reduce infant mortality rate (IMR) to 28 and maternal

mortality ratio (MMR) to 1 per 1000 live births.mortality ratio (MMR) to 1 per 1000 live births.

Provide clean drinking water for all by 2009 and Provide clean drinking water for all by 2009 and ensure that there are no slip-backs by the end of the ensure that there are no slip-backs by the end of the 11th Plan.11th Plan.

Reduce malnutrition among children of age group 0-3 Reduce malnutrition among children of age group 0-3 to half its present level.to half its present level.

Reduce anemia among women and girls by 50% by Reduce anemia among women and girls by 50% by the end of the 11th Plan.the end of the 11th Plan.

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Women and ChildrenWomen and Children Raise the sex ratio for age group 0-6 to 935 Raise the sex ratio for age group 0-6 to 935

by 2011-12 and to 950 by 2016-17.by 2011-12 and to 950 by 2016-17.

Ensure that at least 33 percent of the direct Ensure that at least 33 percent of the direct and indirect beneficiaries of all government and indirect beneficiaries of all government schemes are women and girl children.schemes are women and girl children.

Ensure that all children enjoy a safe Ensure that all children enjoy a safe childhood, without any compulsion to work.childhood, without any compulsion to work.

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InfrastructureInfrastructure Ensure electricity connection to all villages and BPL Ensure electricity connection to all villages and BPL

households by 2009 and round-the-clock power by the households by 2009 and round-the-clock power by the end of the Plan.end of the Plan.

Ensure all-weather road connection to all habitation with Ensure all-weather road connection to all habitation with population 1000 and above (500 in hilly and tribal areas) population 1000 and above (500 in hilly and tribal areas) by 2009, and ensure coverage of all significant habitation by 2009, and ensure coverage of all significant habitation by 2015.by 2015.

Connect every village by telephone by November 2007 Connect every village by telephone by November 2007 and provide broadband connectivity to all villages by and provide broadband connectivity to all villages by 2012.2012.

Provide homestead sites to all by 2012 and step up the Provide homestead sites to all by 2012 and step up the pace of house construction for rural poor to cover all the pace of house construction for rural poor to cover all the poor by 2016-17.poor by 2016-17.

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EnvironmentEnvironment

Increase forest and tree cover by 5 percentage points.Increase forest and tree cover by 5 percentage points.

Attain WHO standards of air quality in all major cities Attain WHO standards of air quality in all major cities by 2011-12.by 2011-12.

Treat all urban waste water by 2011-12 to clean river Treat all urban waste water by 2011-12 to clean river waters.waters.

Increase energy efficiency by 20 percentage points Increase energy efficiency by 20 percentage points by 2016-17.by 2016-17. 2121

Business

Economic planning