FIVE YEAR PLANS (11TH PLAN)

Presentation by : Shwetha Acharya T.

THE PLANNING MACHINERY :

The planning commission was set up in march 1950, by a resolution of the government of India. Jawaharlal Nehru was the 1st chairman of planning commission. It has following functions : To make an assessment of the materials, capital, human resources of the country including technical personnel &investigate the possibilities of augmenting such of these resources as are found to be deficient in relation to the nations requirements. To formulate a plan for the most effective & balanced utilization of the countrys resources

NATIONAL DEVELOPMENT COUNCIL {NDC}

A number of committees & commissions are also working with the Planning Commission. One of them is NDC. The NDC is presided over by the Prime Minister & is composed of Union Cabinet Ministers, Chief Ministers of States & Union Territories & members of the Planning Commission. The secretary of the planning commission acts as secretary of the NDC & the commission is expected to provide such administrative & other support as may be necessary

FUNCTIONS OF NDC :

To prescribe guidelines for the formulation of the National Plan including the assessment of resources for the plan. To consider the important questions of social & economic policy affecting national development.

To revive the working of the plan from time to time & recommend such measures as are necessary for achieving the aims & targets set out in the National Plan , including measures to secure active participation & cooperation of people, improve efficiency of the administrative services, ensure fullest development of less developed regions & section of the community, build up resources for national development.

FORMULATION OF THE PLAN :

The preparation of 5 year plans is usually spread over a period of 2 to 3 years. 1st stage is consideration of the general approach to the formulation involving an examination of the state of the economy, appraisal of past trends of production and growth in long run. Preliminary conclusions in these are submitted to central cabinet & to NDC. On their approval they are published in the form of a document & is free for debate

The 2nd stage is where the planning commission constitutes group of each sector considering specialists in that group make survey, collect opinion of experts. While preliminary documents are debated nation wide. The commission holds detailed discussion with the union ministers, state govt, UTs @the highest level. On the basis of the preliminary studies & results of the discussions a draft report is prepared & based on the draft, final plan for the period is prepared.

OBJECTIVES OF INDIAN PLANS :

Proper utilization of the national priorities & fast development of economy. Alleviation & ultimate removal of unemployment & poverty. Improvements in the standard of living in general. Balanced regional development & all sectors of the economy.

REVIEW OF THE PLANS :-

The dawn of first five year plan began from April 1st 1951. It went on smoothly till 1966 (dusk of 3rd five year plan). Then due to some problems in 3rd plan, severe drought in the country, aggressions between china and Pakistan seriously disrupted the development process. This led to fall in income, sharp increase in prices which in turn led to fall in savings rate. Serious balance of payment crisis which led to devaluation of rupee by 36.5% in June 1966.

The fourth five-year plan was put off by 3years. Because of lack of funds in the govt treasury. The intervening period of 3 years had annual plans. This period is referred as plan holiday. The political change led to premature end of fifth five year plan (74-79). New govt. headed by janata party which assumed power from 1977, brought an end to the fifth plan when it was in its fourth year i.e., march 1978 instead of 1979. it also put forth the rolling plan. The fall of the Janata Govt and congress regaining its power again terminated the rolling plan and began the five year plan which was the sixth plan .

On completion of sixth plan seventh plan was launched on time but 8th plan was delayed by 2 years i.e. it was launched only in 1992. then from 9th plan onwards it is being beginning on time with no delays.

PRIORITIES OF FIVE YEAR PLANS : 1st plan(1951-56) Agriculture. 2nd plan(1956-61) Heavy industries 3rd plan(1961-66) Export promotion 4th plan(1969-74) Self reliance 5th plan (1974-79) Growth with social justice 6th plan (1980-85) significant step up in the growth rate of economy, services in the favour of poor. 7th plan (1985-90) Food work & productivity 8th plan(1992-97) Private participation in business

9th plan (1997-02) - Growth with social justice; adequate employment & eradication of poverty; equality food & nutritional security to all ; population control; environmental sustainability; empowering women & socially disadvantaged people etc. 10th plan (2002-07)- Providing basic necessities of life to the common man , greater participation in decision making. To ensure significant progress towards improvement in the quality of life of all people.

ELEVENTH FIVE YEAR PLAN 2007- 2012 The Background : Despite the not so bad overall performance of the economy large parts of the population is still to experience a decisive improvement in their standard of living. Although the %age of the population below the poverty line is declining the pace is slow, is modest. Still there is huge mass lacking access to basic services such as drinking water ,health, sanitation, education facilities.

ELEVENTH PLAN PERSPECTIVE :

The 11th plan perspective begins with the cautious & realistic note that despite of encouraging GDP growth rate of recent years economic growth has failed to be inclusive particularly after mid 1990s. Agriculture lost its momentum. Jobs in organized sector have not increased despite of faster growth. Malnutrition tends to be declining but a lower rate. Far still too many people still lack access to basic facilities like food, health, education clean drinking water & sanitation facilities without providing all these we cannot claim for development in the economy. Women have increased their participation in work but discrimination continues, declining of child sex ratio.

Vision : Faster and more Inclusive Growth. Plan must aim at putting the economy on a sustainable growth 10% by the end of plan period.- increase in employment opportunities equal income distribution target strong agricultural growth of 4%p.a. reduce disparities across regions & communities by ensuring access to basic physical infrastructure & health & education facilities to all.

Rapid growth is essential for 2 reasons : It is only in a rapidly growing economy that we can expect to sufficiently raise in the incomes of the mass of our population to bring about a general improvement in the standard of living conditions. Rapid growth is necessary to generate resources needed to provide basic services to all. Work done with planning commission & else where suggest that economy can accelerate from 8% per year to an average of about 9% over the end of 11th plan provided policies are put in place. With population growing at 1.5% per year , 9% growth rate in GDP would double the per capita income in 10 years.

Key element of the strategy for inclusive growth must be an overall effort to provide the mass of our people access to basic facilities like health, education, clean drinking water, etc. The private sector, micro, small, & medium enterprises (MSMEs) has a crucial role to play in achieving the objective of faster & more inclusive growth. MSMEs account for 76% of the total investment and more than that employment & output. Growth of entrepreneurship in all levels not just in top management.

1. Income & Poverty : Accelerate GDP growth from 8% to 10% and then maintain at 10% in the 12th Plan. Increase new agricultural GDP growth rate to 4% per year. Create 70 million work opportunities. Reduce educated unemployment to below 5%. Raise real wage rate of unskilled workers by 20 percent. Reduce the headcount ratio of consumption poverty by 10 percentage points.

2. Education: Reduce dropout rates from 52.2% in 2003-04 to 20% by 2011-12. Develop minimum standards of educational attainment in elementary school. Increase literacy rate for persons of age 7 years or more to 85%. Lower gender gap in literacy to 10 percentage points.

3. Women & Children :

Raise the sex ratio for age group 0-6 to 935 by 2011-12 and to 950 by 2016-17.

Ensure that at least 33 percent of the direct & indirect beneficiaries of all government schemes are women and girl children.
Ensure that all children enjoy a safe childhood, without any compulsion to work.

4. Infrastructure: Ensure electricity connection to all villages and BPL households by 2009 and round-the-clock power. Ensure all-weather road connection to all habitation with population 1000 and above by 2009, and ensure coverage of all significant habitation by 2015. Connect every village by telephone by November 2007 and provide broadband connectivity to all villages by 2012. Provide homestead sites to all by 2012 and step up the pace of house construction for rural poor to cover all the poor by 2016-17.

5. Health : Reduce infant mortality rate to 28 and maternal mortality ratio to 1 per 1000 live births. Reduce total fertility rate to 2.1 Provide clean drinking water for all by 2009 and ensure that there are no slip-backs. Reduce malnutrition among children of age group 0-3 to half its present level. Reduce anaemia among women and girls by 50% by the end of the plan.

6. Environment :

Increase forest and tree cover by 5 percentage points. Attain WHO standards of air quality in all major cities by 2011-12.

Treat all urban waste water by 2011-12 to clean river waters.

Increase energy efficiency by 20 percentage points by 2016-17.

7. In general :

Expanding import promotion activity. Strengthening the capacity of disaster prevention &mitigation. Ensuring food & drug safety. Building a legal system in a all round way Building clean & honest government Efforts to promote the culture of the country. Promotion the modernization of the army and also improve the defense of the economy.

THE POTENTIAL
Simulations show that growth that is likely to be achieved without significant new policy initiatives or business as-usual scenario is 7 to 7.5% . Growth has been rapid in recent years so a 8% attainment is not a difficult task. All the models also indicate that with additional policy initiatives it is possible to accelerate the growth rate to 9% .

ALTERNATIVE SCENARIOS FOR 11TH PLAN

Target GDP growth rate in 11th plan Average investment rate 7.0% 29.1 8.0% 32.0 9.0% 35.1

Average CAD as % of GDP

Domestic savings rate a)households b)corporate c)PSEs d)government

2.0
27.1 20.1 5.0 3.1 -1.1

2.4
29.6 20.5 5.5 3.1 0.5

2.8
32.3 21.0 6.1 2.8 2.4

INDIA'S GROWTH PERFORMANCE DURING THE PLANS

Sl no 1 2 First plan Second plan TARGET 2.1 4.5 ACTUAL 3.60 4.21

3
4 5 6 7 8 9 10

Third plan
Fourth plan Fifth plan Sixth plan Seventh plan Eighth plan Ninth plan Tenth plan

5.6
5.7 4.4 5.2 5.0 5.6 6.5 8.0

2.72
2.05 4.83 5.54 6.02 6.68 5.5 7.2*

*estimate

Although the plans have , by and large failed to achieve the targets & shortfalls are conspicuous in several areas. The 1st plan performance was satisfactory but in the 5th, 6th, 7th, 8th, the actual growth rates slightly exceeded the targets.

REASONS FOR PLAN FAILURE IN DEVELOPING COUNTRIES: 1. Inconsistencies in plan objectives : the assumptions of the planners is in conflict with the reality. Economic growth , poverty alleviation employment generation, income inequality reduction & modernization do not go hand in hand.

2.Insufficient & unreliable data : Data gap is too much in LDCS. with this kind of data insufficiency , it is difficult for any planners to build a strong plan 3. Institutional weakness: Continuous interaction between planning agency and day to day decision making machineries of the govt. is generally lacking 4. Lack of political will: The level of commitment among the political leaders & high level decision makers is poor.

5.

Inappropriate plan strategies: Depending mostly on modern industrial economies and giving least importance to agrarian economies.

Thank you