Top 5 Objectives of Planning in India

The following points highlight the top five objectives of planning in India. The objectives are: 1. Economic Growth 2. Economic Equality and Social Justice 3. Full Employment 4. Economic Self-reliance 5. Modernisation.

Objective of Planning # 1. Economic Growth:

Of all the objectives, the objective of economic growth has received the strongest priority in all the plans.

Economic planning in India aims at bringing about a rapid economic development in all sectors.

The key sectors are agriculture, power, industry and transport. Through development of the economy, the country aims at increasing national and per capita incomes. Thus, poverty will be removed and the standard of living improved. National income in the First Plan increased by 18 p.c. against the targeted growth rate of 11 p.c.

National income during the Second Plan period increased by 20 p.c. against the target of 2.5 p.c. p.a. On the other hand, per capita income grew at a rate of 1.8 p.c. p.a. as against the contemplated rate of growth of 3.3 p.c. The Third Plan sought to increase national income by 5.6 p.c. p.a.

But the progress card of the Third Plan showed that national income increased by only 2.6 p.c. p.a. Per capita income during this time failed to rise (just 0.4 p.c. p.a.)

The Fourth Plan aimed at achieving the growth rate of national income and per capita income by 5.7 p.c. p.a., and 3 p.c. p.a. respectively. In reality, the actual achievement of national income was merely 3.4 p.c., while per capita income rose by only 1.1. p.c. The Fifth Plan proposed a growth rate of 3.5 p.c. p.a., but later revised to 4.37 p.c. However, the economy now fared well and attained a growth rate of 4.9 p.c. p.a.

The Sixth Plan aimed at an annual growth rate of 5.2 p.c. Actually, this growth rate was achieved. The Seventh Plan (1985-90) achieved an annual growth rate of 5.5 p.c. The average growth rate during the Eighth Plan was much better (6.7 p.c.) than the Seventh Plan.

This growth rate slipped down to 5.3 p.c. in the Ninth Plan against a contemplated growth rate of 6.5 p.c. An ambitious target of 8 p.c. GDP growth rate had been set in the Tenth Five Year Plan. Actual growth rate achieved in the Tenth Plan (2002-06) stands at 7.8 p.c. against the targeted growth rate of 8 p.c.

Objective of Planning # 2. Economic Equality and Social Justice:

The twin aspects of social justice involves, on the one hand, the reduction in economic inequalities and, on the other, the reduction of poverty. A rise in national income with concentration of economic power in the hands of a few people is not desirable.

In India’s socio-political set-up, vast inequalities exist. Indian plans aim at reducing such inequalities, so that the benefits of economic development percolate down to the lower strata of the society.

The objective of removal of poverty got its clear-cut enunciation only in the Fifth Plan for the first time. Due to the defective planning approach, income inequality widened and poverty became rampant. The incidence of poverty was on the rise. In view of this paradoxical develop­ment, the slogan of ‘Garibi Hatao’ was raised in the Fifth Plan for the first time.

It was estimated that approximately 30 p.c. of the total population was below the poverty line in 1974. In 1983-84, 44.5 p.c. of the total population were below the poverty line. Recently, the Planning Commission has given a new estimate of poverty-stricken people.

In 2004-05, it has been estimated that 27.5 p.c. of the population lived below the poverty line as against 36 p.c. in 1993-94. Though the poverty ratio declined over time, the number of poor people remained at around 260 million in 1999-00.

Objective of Planning # 3. Full Employment:

Removal of unem­ployment is considered another important objective of India’s Five Year Plans. But, unfortu­nately, it never received the priority it deserved. In the Sixth Plan (1978-83) of the Janata Government, employment was accorded a pride of place for the first time. However, the Seventh Plan treated employment as a direct focal point of policy.

As a result, the employment generation programme in India has received a rude shock and the problem of unemployment is mounting up plan after plan. Although unemployment rate has fallen from 9.22 p.c. in 1983.to 8.28 p.c. in 2004- 05, the absolute number of unemployed has increased from 24.34 million to 34.74 million during the period 1983—2004-05.

Objective of Planning # 4. Economic Self-reliance:

Self-reliance, or for that matter self-sufficiency, refers to the elimination of external assistance. In other words, it means zero foreign aid. India is typically a dependent economy. She is used to import huge food grains, fertilisers, raw materials and industrial machinery and equipment’s. But this objective could not be concertized before the launching of the Fourth Plan. The basic aim of the Fifth Plan was the attainment of self-reliance.

To achieve this goal, the Fifth Plan aimed at increasing production of food grains, necessary consumption goods and raw materials and the level of exports. While emphasizing the increase in exports, the Plan emphasised the need for establishing import substitute industries as an important facet of economic self-reliance.

In the new era dating from July 1991, the objective of self-reliance has lost its present interpretation. No longer it refers to self-sufficiency in the present globalized environment. Still then, it is an important component of India’s development policy.

Objective of Planning # 5. Modernisation:

This objective is a newer one. This objective was categorically mentioned for the first time in the Sixth Plan. Modernisation means such variety of structural and institutional changes in the economic activities that can change the feudal and colonial economy into a progressive and modern economy.

The important component of modernisation is the development of a diversified economy that produces a variety of goods. This requires the setting up of variety of industries.

It also refers to an advancement of technology. No doubt, certain technological advances have taken place in agriculture, energy, etc. But there is a real danger of this objective in the present context. The country faces an alarming unemployment problem and, hence, poverty. But modernisation will definitely arrest the employment generation activities. Hence emerged the conflict between the objective of modernisation and the objectives of unem­ployment and poverty eradication.

Besides these long-term objectives, each five Year Plan in India had some short-term objectives. For instance, the First Plan stressed agricultural development, control of inflation and rehabilita­tion of refugees. The Second Plan aimed at rapid industrial growth, specially basic and heavy industries. The Third Plan emphasised an expansion of basic industries, but shifted to defence development.

Evaluation of Objectives:

The objectives of Indian planning are quite comprehensive and its scope is wide. But it has various short-comings.

First, Indian plans are ambitious. Most of the plan objectives remain unfulfilled. Again, some of the objectives are not quantifiable. Furthermore, desired objectives never match with the actual results. Actual results lag behind targets.

Secondly, Indian plans suffer from in­consistency of the objectives that are set. For instance, the objective of accumulation of capital is inconsistent with the objective of reduction of income disparities.

Finally, there are conflicts between objectives. Higher economic growth objective may not commensurate with the employment generation objective. Rapid economic growth requires the use of capital-intensive technology which is by nature labour-displacing. Thus, any attempt to improve GDP growth rate is most likely to frustrate the objective of removal of unemployment.

Despite these shortcomings of Indian planning, we must say that the objective of higher economic growth is the most fundamental of all. Plan objectives must be spelt out as to make them consistent with the country’s needs.