• Outside the Communist bloc, India is a key country to adopt centralized planning as the main strategy for economic development.

• Centralized planning is based on the premise that faster and sustained socio-economic development can be achieved through conscious planning.

• Planning aims to eradicate poverty, illiteracy, deprivation, and inequality of opportunities.

• Ensures assured availability of basic necessities like food, education, employment, and other avenues of growth.

• State planning was practically useful in resource-starved countries like India to:

  • Regulate economic behavior of the people.

  • Accelerate capital formation and productive investment by controlling consumption.

  • Check unnecessary imports.

  • Invest in social and economic overheads and core sectors of the economy.

  • Curb speculative and monopolistic practices.

  • Arrange loans from government and private organizations abroad.

  • Ensure that private profit drive does not produce gross inequalities among different sections of the population.

• The planned economic development of India began with the First Five Year Plan in 1951.

• Focuses on the genesis of planning in India and factors for its adoption as the dominant development strategy.

• Examines the structure and functioning of planning machinery, with emphasis on the Planning Commission as the central authority.

• Addresses the contemporary relevance of planning in the era of liberalization.

• Analyzes the political dimensions of economic reforms in recent years.

CONCEPT OF PLANNED DEVELOPMENT

• Planning conceptually means deciding what should be done in a given situation after careful consideration of alternatives.

• Involves working out the details of implementation to achieve objectives as quickly and economically as possible.

• Developing countries adopt planned economic development due to resource constraints and the urgency to achieve minimum economic development.

• Planning ensures quick and balanced socio-economic development by making the best possible use of available resources without wastage or delay.

• Through planning, countries can guide priorities, direction, and pace of socio-economic development.

• Planning prevents leaving development to market forces, which prioritize maximization of profit over the fulfillment of basic needs of the people.