🏛️ Evolution of Planning in India (Before 1947)
Planning in India began before independence — different thinkers proposed their own economic blueprints.
| Year |
Plan / Committee |
Proposer / Chairman |
Key Idea |
| 1934 |
Visvesvaraya Plan |
M. Visvesvaraya |
First ever blueprint for Indian planning. Book: "Planned Economy for India" |
| 1938 |
National Planning Committee (NPC) |
J.L. Nehru (Chairman) |
Formed by Subhash Chandra Bose (INC President). First national plan attempt. |
| 1944 |
Bombay Plan |
J.R.D. Tata & Leading Capitalists |
"A Plan of Economic Development for India" – Two parts (1944 & 1945) |
| 1944 |
Gandhian Plan |
S.N. Agarwal |
Decentralised economy, self-contained villages, cottage industries, minimal state control |
| 1945 |
People's Plan |
M.N. Roy |
Based on Marxist Socialism. Agriculture + land nationalisation. Roy also founded CPI in Tashkent (1920), formalised in Kanpur (1925) |
| 1950 |
Sarvodaya Plan |
J.P. Narayan |
By Jayaprakash Narayan (founder of Congress Socialist Party, 1934). First blueprint for Independent India's planned development. |
🏛️ Planning Commission (1950)
- Established: March 1950
- Nature: Extra-Constitutional + Non-Statutory body (not in Constitution, not made by Parliament)
- Function: Design and formulate the Five-Year Plans
- Chairman: Prime Minister (Ex-officio)
- Deputy Chairman: Appointed by PM
- Members: Cabinet Ministers + Planning Minister
- Dissolved: 2014 → replaced by NITI Aayog on 1st Jan 2015
🏛️ National Development Council (NDC)
- Established: August 1952
- Function: Approve and implement the Five-Year Plans (designed by Planning Commission)
- Chairman: Prime Minister
Easy trick: Planning Commission = बनाने वाला | NDC = approve करने वाला
🌍 Inspiration: USSR
The concept of Five-Year Plans was borrowed from the USSR (Soviet Union). Joseph Stalin first introduced it there in 1928 to industrialise Soviet Union.
💡 Real-Life Example
Just like a family makes a 5-year plan — "pehle ghar banao, phir bache ki padhai, phir business shuru karo" — India also made step-by-step plans. USSR was already doing this successfully, so India copied the idea!
Four main objectives (remember: G-M-S-E)
⚙️
Modernisation
New technology adopt karo
🏭
Self-reliance
Import kam, domestic production zyada
⚖️
Equity
Sabka development
Perspective Plan: Five-Year Plans also had a long-term (20-year) vision called the Perspective Plan.
🔄 Development Strategies: Inward vs Outward Looking
🔒 Inward-Looking Strategy
- Part of the broader trend of de-globalisation
- Supports local industries through protective measures
- Protects domestic jobs from foreign competition
- Uses tariffs and subsidies to shield domestic producers
- Limits foreign competition
- Emphasises self-sufficiency
- Focuses on import substitution industrialisation (ISI)
- Aims to reduce trade deficits
🌐 Outward-Looking Strategy
- Integral to globalisation
- Encourages free trade and removal of trade barriers
- Welcomes foreign investment
- Promotes global integration
- Prioritises economic efficiency through competition
- Facilitates technological innovation
- Embraces export-oriented industrialisation
- Seeks comparative advantage in global markets
💡 Real-Life Example
Inward: Jaise pehle India mein foreign cars allowed nahi thi — Maruti banti thi, Maruti chalti thi! Ye inward strategy thi. | Outward: Aaj India mein Toyota, Honda, BMW sab aate hain — ye outward/globalisation hai.
1st Five-Year Plan 1951–1956
📊 Performance
🏆 Highly Successful
⚡ Context — Why Agriculture First?
- India just got independence — there was a food shortage crisis
- Huge influx of refugees from Pakistan partition — needed to feed them
- Primary Sector (farming) needed immediate attention
🏗️ Key Developments & Projects
- Bhakra Nangal Dam: On Sutlej River — Highest gravity dam of India
- Hirakud Dam: On Mahanadi River, Odisha — Longest dam of India
- Nagarjuna Sagar Dam: On Krishna River
- IIT Kharagpur (1951): First IIT established. Others followed: IIT Bombay (1958), IIT Kanpur (1959), IIT Madras (1959), IIT Delhi (1961)
- Land to the Tiller: Ownership rights given to actual cultivators → abolished Zamindari system
- Community Development Programme (CDP): Launched 1952 for rural development
- Land Ceiling Act: Land reforms started in 1st Plan, but specific Land Ceiling Act was enacted in 1976
💡 Real-Life Example
Socho ek naya ghar khareeda — pehle kitchen aur bathroom banate hain (basic needs first). Usi tarah India ne independence ke baad pehle food production par dhyan diya. Bhakra Nangal Dam = aaj bhi Punjab, Haryana aur Rajasthan ko paani deta hai!
2nd Five-Year Plan 1956–1961
📊 Performance
⚠️ Moderately Successful (narrowly missed)
🏗️ Key Developments
- 3 Steel Plants set up:
① Rourkela Steel Plant (RSP) — 1959, Odisha — German collaboration
② Durgapur Steel Plant (DSP) — 1959, West Bengal — British collaboration
③ Bhilai Steel Plant (BSP) — 1955, Chhattisgarh — USSR collaboration
- Industrial Policy Resolution of 1956 (2nd IPR) was the foundational policy for this plan
- Karve Committee (1955): Also known as Village & Small-Scale Industries Committee. Chairman: D.G. Karve. Goal: Promote rural development through small-scale industries alongside heavy industrialisation
👨🔬
About P.C. Mahalanobis — Chief Architect of Indian Planning
- Birth Anniversary: 29 June → celebrated as Statistics Day
- Founded: Indian Statistical Institute, Kolkata
- Started journal: Sankhya
💡 Real-Life Example
Ghar ban gaya (1st plan), ab factory lagao — kapde, steel, machines bano. Jaise Rourkela Steel Plant aaj bhi India ka important steel producer hai. Bhilai — RSS-wala nahi, Bhilai Steel Plant wala! 😄 USSR ne help ki aur aaj bhi Bhilai ek major industrial town hai.
3rd Five-Year Plan 1961–1966
📊 Performance
💥 Disastrous Failure — Most Failed Plan
💥 Reasons for Failure — Triple Shock
- Indo-China War (1962): Diverted funds from development to defence
- Indo-Pak War (1965): Further drained resources
- Severe Drought (1965–66): Massive food crisis
🏗️ Key Developments
- Food Corporation of India (FCI): Established 14 January 1965
- Agricultural Prices Commission (APC): Set up 1 January 1965 — recommends Minimum Support Prices (MSP). Later renamed CACP (Commission for Agricultural Costs and Prices)
- Industrial Development Bank of India (IDBI): 1 July 1964
- Unit Trust of India (UTI): 1963 (by Act of Parliament) → Established 1 February 1964
- PL 480 Scheme: India imported wheat from USA to alleviate hunger and poverty
⚠️ Most asked in SSC: 3rd FYP = सबसे ज़्यादा fail हुई। Triple shock = China war + Pakistan war + Drought
💡 Real-Life Example
Socho tum apne business ka plan bana rahe the, lekin achanak 2 baar road accident ho gaya + badi bimari bhi aa gayi — sab paisa chala gaya. Usi tarah India ka 3rd plan tha — do wars + ek bada drought = complete failure. PL 480 = America se udhaar ka anaj maangna pada!
⏸️ Plan Holiday — No Five-Year Plan for 3 Years!
- Period: 1966–1969 (3 Annual Plans instead of a Five-Year Plan)
- Reason: Economic strain from wars + severe drought
- Focus: "New Agriculture Strategy" = Green Revolution
- Green Revolution: Widespread distribution and adoption of HYV (High Yielding Variety) seeds
- Phase 1: Mid 1960s–1970s
- Phase 2: Mid 1970s
💡 Real-Life Example
Jab exams mein bahut zyada fail ho jao toh gap year lete hain — self-study, coaching, preparation. Usi tarah India ne 3 saal ka "gap" liya aur agriculture ko sudhara. Green Revolution ki wajah se Punjab aaj bhi "India ka anaj ka bhandaar" hai!
4th Five-Year Plan 1969–1974
⚡ Key Initiatives & Reforms
- Family Planning Programme was introduced
- 14 major banks nationalised — 1969 (famous step by Indira Gandhi)
- First Underground Nuclear Test: "Smiling Buddha" — 1974 in Pokhran
- Drought Prone Area Programme — 1973–74
💡 Real-Life Example
"Garibi Hatao" ki nींव यहीं से। Indira Gandhi ne 14 banks nationalise kiye — matlab sarkar ne private banks ko apne haath mein le liya taaki common people ko loan mil sake. "Smiling Buddha" = India ka first nuclear test — code name bahut cute tha but kaam khatarnak tha! 😄
5th Five-Year Plan 1974–1978
⭐ IMPORTANT: Only Five-Year Plan that lasted just 4 years — terminated 1 year early by Janata Party government (1977)
📊 Performance
✓ Moderately Successful
⚡ Key Initiatives & Schemes
- Garibi Hatao slogan: Given by Indira Gandhi — poverty alleviation main focus
- Regional Rural Banks (RRBs): Set up 1975 — to bring banking to villages
- 20 Points Programme (1975): Aimed to reduce poverty and improve quality of life
- Minimum Needs Programme (1974): Basic needs (food, shelter, education) for poor
- Hill Area Development Programme: Development of hilly regions
- Attainment of self-reliance was a key goal
💡 Real-Life Example
Regional Rural Banks = Aaj bhi Grameen Bank jaisi soch. Gaon ke kisan ko bank se loan milna chahiye — yahi socha gaya. RRBs aaj India ke har district mein hain. "Garibi Hatao" = Indira Gandhi ka best political slogan, jo aaj bhi yaad hai!
🔄 Rolling Plan
- Introduced by: Janata Party / Morarji Desai Government
- Duration: 1978–1980
- Key Focus: Increase in GDP, employment, and agricultural production
⚡ Key Schemes
- TRYSEM — Training Rural Youth for Self-Employment
- IRDP — Integrated Rural Development Programme (assets transfer)
- NREP — National Rural Employment Program (slack season employment)
- RLEGP — Rural Landless Labour Employment Guarantee Programme — Launched 15 August 1983
- NABARD (National Bank for Agriculture and Rural Development) — Established 12 July 1982, on the recommendation of B. Sivaraman Committee
6th Five-Year Plan 1980–1985
📊 Performance
✔ Successful
🎯 Primary Focus
- Increase in National Income
- Modernisation of technology
- Decrease poverty and unemployment (skill transfer schemes)
💡 Real-Life Example
Indira Gandhi phir waapas aayi power mein (1980) aur Rolling Plan band karke proper Five-Year Plan shuru kiya. NABARD ki sthapna isi daur mein — aaj bhi NABARD rural India ka financial backbone hai!
7th Five-Year Plan 1985–1990
📊 Performance
✔ Successful
🎯 Primary Focus — Three Pillars
- Food: Accelerating food grain production
- Work: Generating employment opportunities
- Productivity: Economic productivity through "Social Justice"
⚡ Key Developments
- Jawahar Rozgar Yojana (1989): Formed by merging NREP + RLEGP
- Department of Biotechnology set up by GOI
📉 Hindu Rate of Growth (1978)
- Term given by: Prof. Raj Krishna
- Signified: Low economic growth of India
- Period: 1960–1980 — India had slow economic growth rate (~3.5%)
💡 Real-Life Example
Rajiv Gandhi = India mein computer revolution laane wale PM. 7th plan mein Biotechnology Department bana — aaj India is department ke karan vaccines, medicines export karta hai! Jawahar Rozgar Yojana = gaon ke loge ko sarkar ka kaam = MGNREGA ka baap!
📋 Annual Plans — No Five-Year Plan Again!
- Period: 1990–1992 (2 Annual Plans)
- Reason: Political Uncertainty (no stable government)
- Balance of Payments (BoP) Crisis — 1991: India's foreign exchange reserves were almost zero. India had to pledge its gold reserves to get a loan from IMF!
- This crisis led to the beginning of LPG Reforms = Liberalisation + Privatisation + Globalisation
💡 Real-Life Example
1991 mein India ke paas itna paisa nahi tha ki import kar sake — sone ko girvi rakhna pada! Ye India ke liye ek bahut badi sharm thi. Isi wajah se Dr. Manmohan Singh ne economy open ki — aur India badal gaya! Ye wahi turning point tha.
8th Five-Year Plan 1992–1997
⭐ Called the "Game Changer Plan" — transformed Indian economy forever!
📊 Performance
🏆 Highly Successful
⚡ Key Features
- New Indicative Policy: Government no longer dictates — only guides
- Human Development: Focus on education, health, skills
- Economic and Fiscal Reforms: Budget deficit control, taxes simplified
- License Raj ENDED: Industries freed from government licensing
- Public sector share declined: From dominant to just ~34% of total investment
- Agriculture dependency: 65% population still in agriculture (1990), but GDP share had fallen significantly (67.5% in 1950 → 64.9% by 1990 in population terms)
💡 Real-Life Example
1991 mein India ka darwaza khula — foreign companies aane lagi, MNCs aayi, Pepsi-Coca Cola India mein aaye, LG-Samsung factories lagi. Ye sabka credit 8th plan + Dr. Manmohan Singh ko jata hai. License Raj khatam = ab bakery kholne ke liye 10 government permissions nahi chahiye!
9th Five-Year Plan 1997–2002
⚡ Key Points
- After 9th FYP: Not much focus on public sector — private sector dependency grew
- Pokhran-II (1998): Second nuclear test. Code Name: Operation Shakti
10th Five-Year Plan 2002–2007
📊 Performance
✗ Failure (narrowly missed 8% target)
⚡ Key Initiatives
- National Horticulture Mission (NHM): Promoted by government (fruits, vegetables, flowers)
- Jute Technology Mission: Introduced
- Micro Irrigation Programme: Drip irrigation, sprinkler irrigation — save water
- Social Goals: Reduce gender gaps in literacy & wage rate, reduce Infant & Maternal mortality, improve access to potable drinking water, clean major polluted rivers
- India emerged as one of the fastest growing economies by end of 10th Plan
💡 Real-Life Example
Micro Irrigation = Drip Irrigation. Israel se seekha — ek-ek boond paani se fasal ugao. Aaj Maharashtra, Gujarat mein drip irrigation se aam, angoor export hote hain. National Horticulture Mission = banana, tomato, flower exports badhe!
11th Five-Year Plan 2007–2012
📊 Performance
✗ Failure (Global Financial Crisis 2008 impact)
Note: Global financial crisis (2008 Lehman Brothers collapse) overlapped with this plan period — affected India's growth targets.
12th Five-Year Plan — Last FYP 2012–2017
End of an Era: After this plan, Planning Commission was dissolved (2014) and replaced by NITI Aayog (1st Jan 2015). Five-Year Plans were discontinued.
| Plan | Period | PM | Focus | Target | Achieved | Result |
|---|
| 1st | 1951–56 | Nehru | Agriculture | 2.1% | 3.6% | ✔ Great |
| 2nd | 1956–61 | Nehru | Heavy Industry | 4.5% | 4.3% | ≈ Moderate |
| 3rd | 1961–66 | Nehru | Self-reliance | 5.6% | 2.8% | ✗ Worst |
| ⏸️ Plan Holiday (1966–69) |
| 4th | 1969–74 | Indira G. | Growth+Stability | 5.6% | 3.3% | ✗ Failed |
| 5th | 1974–78 | Indira G. | Poverty/Employment | 4.4% | 4.8% | ✓ Moderate |
| 🔄 Rolling Plan (1978–80) — Janata Party |
| 6th | 1980–85 | Indira G. | National Income | 5.2% | 5.7% | ✔ Success |
| 7th | 1985–90 | Rajiv G. | Food/Work/Productivity | 5% | 6% | ✔ Success |
| 📋 Annual Plans (1990–92) — BoP Crisis + LPG Reforms |
| 8th | 1992–97 | PVN Rao | LPG/Human Dev. | 5.6% | 6.8% | 🏆 Game Changer |
| 9th | 1997–02 | Vajpayee | Social Justice | 6.5% | 5.4% | ✗ Failed |
| 10th | 2002–07 | Vajpayee/MMS | NHM/Irrigation | 8% | 7.6% | ✗ Failed |
| 11th | 2007–12 | MMS | Inclusive Growth | 9% | 8% | ✗ Failed |
| 12th | 2012–17 | MMS | Sustainable Growth | 8% | — | Last FYP |
🏛️ NITI Aayog — National Institution for Transforming India
- Planning Commission replaced: 2014 → NITI Aayog set up on 1st January 2015
- Nature: Non-Constitutional body (like Planning Commission)
- Chairman: Prime Minister of India
- Five-Year Plans: Discontinued after Planning Commission was dissolved
- Function: Policy think tank for Government of India
- Designs and recommends policies and programs for India's development
- Publishes reports on: fiscal health, education quality, water management
💡 Real-Life Example
Planning Commission = Purana school principal jo sab decide karta tha. NITI Aayog = Nayi advisory board jo suggest karti hai, lekin final decision government ka. NITI Aayog reports — jaise SDG India Index, Health Index — states ki ranking karti hai taaki competition ho!
📋 What is IPR?
Policy frameworks set by Indian government to regulate industrial growth, define the role of public/private sectors, and promote economic development.
🔴 1st IPR, 1948
- Led by: Dr. Shyama Prasad Mukherjee (Industry & Commerce Minister)
- Declared India as a Mixed Economy
- Started License Raj
- Laid foundation for public sector dominance
Industries divided in 4 groups:
🚂 Strategic (Public) — Railways, Defence, Atomic
⚙️ Basic (Public-Pvt) — Coal, Steel, Aircraft
🏭 Regulated Pvt — Sugar, Cement, Textiles
🛒 Other (Pvt/Coop) — Consumer goods, SSI
🟠 2nd IPR, 1956 — "Economic Constitution of India"
- Also called: "Economic Constitution of India"
- Framework for socialist industrial growth
- Foundational policy for India's 2nd Five-Year Plan
Schedule A — 17 Industries (Public Sector Monopoly)
Aviation, Atomic energy, Railways, Arms & Ammunition, Steel & Iron
Schedule B — 12 Industries (Public & Private)
Aluminium, Machine tools, Chemicals, etc.
Schedule C — All Other Industries (Private)
Consumer goods, Textiles, Automobiles, etc.
🟡 3rd IPR, 1977 (Extension of 1956)
- Introduced by: Morarji Desai Government (Janata Party)
- Emphasised growth of Small-Scale Industries (SSI)
- Introduced "Tiny Unit" concept: Small enterprises with investment below ₹1 lakh
- Restrictions on MNCs — focus on self-reliance
🔵 4th IPR, 1980
- Introduced by: Indira Gandhi Government
- Shifted focus back to heavy industries
- Encouraged foreign technology transfer — FERA Act 1973
- MRTP Act 1969 amended (removed asset threshold limits)
- Investment limit for tiny unit increased to ₹2 lakhs
🟢 5th IPR, 1991 — New Industrial Policy (Economic Liberalisation)
- Announced by: P.V. Narasimha Rao govt, led by Dr. Manmohan Singh
- End of License Raj: Most industries freed from licensing requirements
- Privatisation: Disinvestment in PSUs (Public Sector Undertakings)
- FDI opened: Foreign Direct Investment allowed in key industries
- LPG Reforms: Liberalisation + Privatisation + Globalisation
- Exit policy for sick private sector units — smooth exit without hurting labour welfare
🤝 Joint Sector + Key Economic Terms
- Joint Sector: Partnership between public sector (government) and private sector. Dutta Committee recommended establishment of Joint Venture Sector in Indian industry
- FDI (Foreign Direct Investment): Investment from another country into a local business (e.g., Samsung building factory in India)
- Shell Company: A company that exists only on paper — no real business operations
- Round Tripping: Domestic money leaves the country and returns as "Foreign Investment" — a way to launder black money as FDI
💡 Real-Life Example
FDI: Amazon building warehouses in India = FDI. | Shell Company: Ek naam ki company jo bas tax bachane ke liye bani — koi office nahi, koi employee nahi. | Round Tripping: Kaala paisa Mauritius bhejo, wahan se "FDI" ke roop mein India mein laao — yahi round tripping hai!
⭐ SSC Exam Must-Remember Points
Most Failed Plan: 3rd FYP (1961–66) — Triple Shock (China war + Pak war + Drought)
4-Year Plan (Shortest): 5th FYP (1974–78) — terminated early by Janata Party
Game Changer Plan: 8th FYP (1992–97) — LPG Model, Rao-Manmohan Model
FYP borrowed from: USSR — Stalin introduced it in 1928
Chief Architect: P.C. Mahalanobis — Statistics Day on 29 June
NITI Aayog: 1st Jan 2015 — replaced Planning Commission
2nd IPR 1956: "Economic Constitution of India" — 3 schedules (A, B, C)
Hirakud Dam: Longest dam — Mahanadi, Odisha | Bhakra Nangal: Highest gravity dam — Sutlej
Smiling Buddha (1974): First nuclear test | Operation Shakti / Pokhran-II (1998): Second
NABARD: 12 July 1982 — B. Sivaraman Committee recommendation
Hindu Rate of Growth: Concept by Prof. Raj Krishna (1978) — ~3.5% slow growth
IIT Kharagpur (1951): First IIT of India
Notes compiled from PARMAR SSC — Lecture 11 · Five Year Plans · For SSC/UPSC Exam Preparation