Paradigmatic shift

During the implementation of the 12th plan, there was a general election in 2014 and a new government came into office with Shri Narendra Modi as the Prime Minister. Soon thereafter, the Planning Commission was abolished and Niti (National Institute for Transforming India) Aayog came into existence on 1st January 2015 through a resolution of the Cabinet. The new body was formed to better serve the needs of the people through better governance.

65 years of planning: an assessment

The 12th plan was given a quiet send-off with very little post-plan analysis and assessment. From 2015 onwards, the basic structure of Niti Aayog began to take shape. The new body was to be chaired by the Prime Minister of India and would constitute Chief Ministers and Lt. Governors of States/UTs and other invitees.

The main purpose of setting up Niti Aayog was to provide a more nimble body that would meet the governance and growth challenges in a new world. The Planning Commission was not adequately meeting these challenges because of its top-down and centralized approach. Further, its relevance was coming down in a world where the market forces were determining the allocation of resources and where the private sector was driving investment. Finally, most five-year plans had laudable growth objectives but were often not achieved. The most basic growth targets and achievements over the five-year plans can be seen below:

If we look at the sectoral analysis, perhaps the biggest failure in 65 years of planning has been agriculture. While all the plans recognized the importance of agriculture, most plans lamented the failure to achieve the modest goals. The emphasis on agriculture was woven together with the two most important objectives of planning: poverty elimination and employment generation. Since a large proportion of the population lived in rural areas, where agriculture was the mainstay, it was important for agriculture and allied sectors to grow at a fast pace. However, 30 per cent of the population was under the property line even in 2010 (based on the Tendulkar Committee methodology) and the unemployment rate was about 9 per cent at the beginning of the 10th Plan.

Another issue that the planners had to face was that most estimates turned out to be wide off the mark and resulted in Revised Estimates which were different from the Plan numbers. This was seen in the area of financing the Plan. In the initial years, there was euphoria about the successful first plan, which came on the back of high levels of foreign aid and deficit financing. This became the model for the next two plans when the plan sizes were raised substantially based on large amounts of foreign aid and deficit financing. The importance of high domestic savings (for converting into an investment) and controlling deficit financing (to manage inflation) was realized gradually.

Some of the other areas where our planning fell short were: persisting regional inequalities, rising concentration of income and failure to control the parallel economy.

On the other hand, our planning experience was successful in becoming largely self-sufficient in food grains production, setting up the basic industrial infrastructure (steel, cement, fertilizers), expanding telecommunication and transport (rail, road, ports) network, irrigation and power infrastructure, space technology and laying the groundwork for primary, secondary and higher education.

The coming of Niti Aayog

As noted above, Niti Aayog came into being in 2015, with the stated objective of providing an alternative development paradigm. Some of the objectives stated on its website are:

* Involve the States in setting out national development priorities;

* Foster cooperative federalism;

* Bottom-up planning starting at the village level;

* Integrate national security with economic strategy and policy;

* To design strategic and long-term policy and programme frameworks with an emphasis on monitoring and feedback;

* Involve national and international experts, practitioners and other partners;

* Resolve inter-sectoral and inter-departmental issues;

* To maintain a state-of-the-art resource centre, be a repository of research on good governance and best practices in sustainable and equitable development as well as help their dissemination to stakeholders;

* To focus on technology upgradation and capacity building for implementation of programmes and initiatives.

One of the main reasons for the creation of Niti Aayog was that the Planning Commission was not in step with the aspirations of the people and was not able to take up large and imaginative infrastructure projects that were a must for India to grow at 10 per cent per annum. Another complaint was that the Planning Commission was politicized and unilateral in policy-making, which led to many States (mainly where the opposition parties were in power) getting the short shrift.

Finally, it was felt that the Planning Commission was not factoring in socio-economic diversities across States while making Plans.

The new government was led by Shri Narendra Modi as Prime Minister, who was putting to use his long experience as Chief Minister of Gujarat. This was reflected in the emphasis on the active involvement of the States in Niti Aayog and a constant reference to cooperative federalism. Further, the focus shifted from Planning to Projects, most of which were to be implemented in ‘mission mode’. This was visible in the ‘Jan Dhan’ accounts which were opened across the country and led to many citizens opening a bank account for the first time. This was combined with Aadhar and the mobile phone constituted the ‘JAM’ trinity and has been successful in transferring benefits directly to the beneficiaries’ accounts. This was extended further to include payments banks, United Payment Interface UPI) and seamless coverage across shops, establishments and merchants and many services: popularly referred to as ‘Digital India Stack’.

Another area where planning has been superseded and projects have been emphasized has been in the area of large infrastructure projects and their regular monitoring: mostly in the areas of railways, ports, highways and other socio-economic infrastructure. All this has now been integrated into the PM Gatishakti platform, with projects being monitored at the highest level.

Niti Aayog has also been addressing many of the salient development issues some of which are: addressing challenges arising out of urbanization, widespread use of technology in the implementation of development programs, addressing issues arising out of the global climate change agreements, integrating India into global supply chains by participating in FTAs and trade agreements beneficial to India, taking the lead in cutting edge technologies such as green hydrogen, pushing the transition to electric vehicles and leveraging our demographic dividend through realizing the full potential of our youth through education and skill development.

Conclusion

The 12 five-year plans spanning from 1950 to 2017 did provide India with basic industrial infrastructure, many public sector undertakings, a vast education system and some impressive achievements in areas such as Green Revolution, Dairy Development, Space and Satellite Technology and Telecommunications. However, with the increasing participation of the private sector and the greater integration of India with the world economy, the Planning Commission was left wanting in addressing various challenges. The arrival of Niti Aayog was perhaps timely and while it is a young organization, it has been able to give thought and policy leadership to India’s multifarious challenges.

The writer is Addl. Chief Secretary, Dept of Mass Extension Education and Library Services, Govt of West Bengal.