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Unit 2: Development Strategies in India: Planning in India: Objectives, Strategies and Evaluation

Karl Marx believed that the capitalist economy allowed a few powerful industrialists and traders to Notes
exploit the vast majority of workers. Marx advocated socialization of all the means of production and
wanted the state to direct the economy. He would have no private enterprise system based on self-
interest, private property, market forces of demand and supply and maximization of profit for the
individual. The rise of communist regimes in USSR in 1917 and eastern European countries, Communist
China, Vietnam, Cuba etc., later was the direct consequence of the impact of Marxist ideas.
2.2 Objectives of Economic Planning in India

The Committee produced a series of studies on different subjects concerned with economic
development. The Committee laid down that the State should own or control all key industries and
services, mineral resources and railways, waterways, shipping and other public utilities and, in fact,
all those large-scale industries which were likely to become monopolistic in character.
Besides the National Planning Committee (NPC) eight leading industrialists of India conceived “A
Plan of Economic Development” which was popularly known as the Bombay Plan. There was also a
Gandhian Plan which was prepared by Shriman Narayan. The world famous revolutionary M.N.
Roy formulated the People’s Plan. All these plans were only of historical importance because they
were just paper plans which were never implemented. But they stimulated thinking about the various
aspects of planning in India.
Just after the attainment of Independence the Prime Minister Nehru set up the Planning Commission
in 1950 to assess the country’s needs of material capital and human resources and to formulate
economic plans for their more balanced and effective utilisation. The First Five Year Plan commenced
in 1950-51 and it was followed by a series of Five-Year Plans.

The India National Congress, under the inspiration of Jawaharlal Nehru, set up the
National Planning Committee (NPC) towards the end of 1938.

The Directive Principles of our Constitution laid down : “The State shall, in particular, direct its policy
towards securing - (a) that citizens, men and women equally, have the right to an adequate means of
livelihood : (b) that the ownership and control of the resources of the community are so distributed as
best to subserve the common good : (c) that the operation of the economic system does not result in the
concentration of wealth and means of production to the common detriment.” The Directive Principles
of the Indian Constitution are, thus, an expression of the will of the of people of India for rapid economic
growth. Accordingly, the Government of India adopted planning as a means of fostering economic
development. The Planning Commission set out the following four long term objectives of planning :
(i) to increase production to the maximum possible extent so as achieve higher level of national
and per capita income;
(ii) to achieve full employment;
(iii) to reduce inequalities of income and wealth; and
(iv) to set up a socialist society based on equality and justice and absence of exploitation.
The First Five-Year Plan expressed clearly the long-term objectives of goals of economic planning in
India as follows : “Maximum production and full employment, the attainment of economic equality
or social justice which constitute the accepted objectives of planning under present day conditions
are not really so many different ideas but a series of related aims which the country must work for.
None of these objectives can be pursued to the exclusion of others, a plan of development must place
balanced emphasis on all of these.
In his book “Planning and the Poor”. B.S. Minhas a former member of the Indian Planning Commission
states : “Securing rapid economic growth and expansion of employment, reduction of disparities in
income and wealth, prevention of concentration of economic power, and creation of the value and
attitudes of a free and equal society have been among the objectives of all our plans.”

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