Page 31 - DECO502_INDIAN_ECONOMIC_POLICY_ENGLISH

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

• The LPG Model of development which was introduced in 1991 by the then Finance Minister Dr. Notes
Manmohan Singh with a big bang was intended to charter a new strategy with emphasis on
liberalisation, privatisation and globalisation. (LPG) Several major changes at the domestic level
were introduced.
• Dr. A.P.J. Abdul Kalam, ever since he became the President of India has been advocating his
Vision 2020, and, to eradicate poverty from India, he has been emphasizing the adoption of
PURA (Providing Urban Amenities in Rural Areas). In his address to the Food Security Summit
on 5th February 2004, he outlined the concept and strategy of PURA as the lever of economic
upliftment of the villages.
• The objective of PURA is to propel economic development without population transfers. To put
in the words of late Prof. A.M. Khusro : Instead of moving human beings where infrastructure
exists, it is better take infrastructure to villages where human beings live. The PURA concept is
the response to the need for creating social and economic infrastructure which create a conducive
climate for investment by the private sector to invest in rural areas.
2.5 Key-Words

1. Mixed economy : An economic system in which both the private enterprise and a degree of
state monopoly (usually in public services, defense, infrastructure, and basic
industries) coexist. All modern economies are mixed where the means of
production are shared between the private and public sectors.
2. Distortion : A distortion is departure from the allocation of economic resources from the
state in which each agent maximizes her own welfare. A proportional wage-
income tax, for instance, is distortionary, whereas a lump-sum tax is not. In
a competitive equilibrium, a proportional wage income tax discourages work.
2.6 Review Questions

1. What are the objectives of economic planning? Discuss
2. Explain the strategies and evaluation of planning.
3. India as a mixed economy? Explain.
4. What is meant by democratic socialism in India? Explain.

Answers: Self-Assessment
1. (i)(a) (ii)(c) (iii)(a) (iv)(b)
2.7 Further Readings

1. Indian Economy ; Gaurav Datt and Aswani Mahajan; S. Chand and Company
LTD. Ram Nagar, New Delhi-110055.
2. The Indian Economy ; S.K. Ray; Prentic, Hall of India Private Limited
New Delhi - 110001.

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