Targets and Triumphs of India’s Five-Year Plans
In the grand tapestry of India’s developmental journey, the Five-Year Plans stand as a testament to the nation’s commitment to progress. Spanning several decades, these ambitious blueprints have charted the course for economic growth, social justice, and infrastructure development. In this exploration, we delve into the targets and achievements that have shaped India’s destiny through its various Five-Year Plans.
The Genesis: First and Second Five-Year Plans (1951-1961)
The inaugural Five-Year Plans were akin to a blueprint for a newly independent India. Crafted against the backdrop of post-independence challenges, these plans laid the groundwork for industrialization, agrarian reforms, and social upliftment. The aim was clear: eradicate poverty and build a self-reliant economy. By channeling resources into sectors like steel, power, and irrigation, the nation aimed to set a sturdy foundation for growth.
The First Plan, from 1951 to 1956, focused on rehabilitation and reconstruction, while the Second Plan (1956-1961) honed in on industrialization. By the end of these initial phases, India witnessed the establishment of iconic institutions like the Indian Institutes of Technology (IITs) and a surge in steel production, marking the successful realization of several targets.
Green Revolution and Self-sufficiency: Third to Sixth Five-Year Plans (1961-1980)
The subsequent plans took a cue from agricultural innovation, launching the Green Revolution during the Third Plan (1961-1966). Aimed at achieving self-sufficiency in food production, this period witnessed the introduction of high-yielding crop varieties and advanced farming techniques. The results were tangible – bumper harvests, increased rural income, and a significant step towards food security.
As India marched through the Fourth to the Sixth Plans, emphasis was placed on diversification and technological advancements in sectors such as power, education, and healthcare. The country witnessed remarkable strides in space technology with the launch of Aryabhata, India’s first satellite, during the Fourth Plan. This era also saw the establishment of the Apollo Hospitals, underscoring a commitment to healthcare infrastructure.
Liberalization and Globalization: Seventh to Eleventh Five-Year Plans (1985-2012)
The winds of change swept through India’s economic landscape during the Seventh Plan (1985-1990). The shift towards liberalization and globalization aimed to open up the economy, encourage private sector participation, and foster international collaboration. This era marked a departure from the centralized planning approach of the past, ushering in an era of market-oriented reforms.
The Eighth to Eleventh Plans continued this trajectory, placing a premium on infrastructure development, poverty alleviation, and social inclusion. Telecommunication boomed, with the penetration of mobile phones transforming communication across the nation. The National Rural Employment Guarantee Act (NREGA), launched during the Tenth Plan, sought to provide livelihood security to rural households.
Inclusive Growth and Sustainable Development: Twelfth Five-Year Plans (2012-17)
In the 21st century, India’s Five-Year Plans evolved to align with global sustainability goals and inclusive growth. The Twelfth Plan (2012-2017) focused on reducing poverty, promoting education, and addressing environmental concerns. Initiatives like Swachh Bharat Abhiyan aimed to make India open defecation-free, addressing sanitation challenges head-on.
National Income:
The First Five-Year Plan aimed at increasing the national income at the rate of 2.1 per cent per annum and per capita income at the rate of 0.9 per cent per annum. As against this, the actual achievements were 4.6 per cent per annum and 2.7 per cent per annum respectively. The second Plan aimed at increasing the national income at the compound annual rate of 4.5 per cent and per capita income at 3.3 per cent.
However, annual growth rate was 4.1 per cent in the former case and 2.1 per cent in the later. The Third Plan kept the target for increase in national income at 5.6 per cent per annum and for per capita income at 3.2 per cent per annum. As against this, national income rose by only 3.3 per cent per annum while per capita income rose by only 1.0 per cent per annum.
The Fourth Plan kept the target for increase in net domestic product at 5.7 per cent per annum while actual achievement was merely 3.0 per cent. The Draft Fifth Five-Year Plan proposed a rate of growth of 5.5 per cent per annum while actual rate of growth was 5.0 per cent per annum. 197-80 a year of negative growth. Keeping in view the fact that national income had declined by 5.9 per cent in 1979-80, 5.3 per cent per annum increase in NNP under the Sixth Plan cannot be considered an impressive performance by any standard.
The Tenth Plan registered a remarkable recovery and the rate of growth of national income rose to as high as 7.6 per cent per annum while the rate of growth of per capita income was 5.9 per cent per annum. The rate of growth of national income in the Eleventh Plan (2007-12) was 7.5 per cent per annum as against the target of 9.0 per cent per annum.
In the Twelfth Plan (2012-17), the rate of growth of national income is estimated at 6.7 per cent per annum. The CSO released a new series of national accounts with a revised base year of 2011-12 on January 30, 2015. According to this series, the rate of growth of GDP at constant (2011-12) prices was as high as 8.0 per cent in 2015-16 and 7.1 per cent in 2016-17. According to CSO, it is expected to be 6.6 per cent in 2017-18. In fact, during some of the recent years, the Indian economy was the fastest growing major economy of the world.
Industrial Sector:
The compound (annual) growth rate of industrial output was quite impressive during the first three plans. In fact, it rose from 5.7 per cent in the First Plan to 7.2 per cent in the Second Plan and further to 9.0 per cent in the Third Plan. After this, the performance of the industrial sector deteriorated considerably. During the eleven year period (1966 to 1976), the annual growth rate fell to about 4.1 per cent, including the 10.6 per cent increase in 1976.
During the 1980s, industrial growth showed signs of recovery on account of liberalisation in the industrial policy. Performance of the industrial sector has been quite unsatisfactory during the Twelfth Plan. In fact, the average rate of growth in this Plan according to old series 2004-05= 100) was only 1.4 per cent per annum while according to the new series (2011-12=100), it was 3.7 per cent per annum. The rate of growth of industrial production in the last year of this Plan, 2016-17, was only 0.7 per cent according to the old series and 4.6 per cent according to the new series.
Agricultural Sector:
Performance of the First Plan on this front was satisfactory. Production of foodgrains rose from 54 million tonnes in 1950-51 64.8 million tonnes in 1955-56 against the target of 61.6 million tonnes. Target for foodgrains production was kept at 75 million tonnes in the Second Plan, while achievement was 76 million tonnes.
The performance of the Third Plan on the agricultural front can be considered quite unsatisfactory keeping in view the fact that achievements were below targets for most of the crops.
In line with the New Agriculture Policy 2000 which envisaged a growth rate exceeding 4 per cent per annum in the agricultural sector, the Tenth Plan aimed at a 4 per cent per annum growth. The demand for foodgrains was put 236 million tonnes by the end of Plan, i.e., 2006-07, while the supply projection for foodgrains in that year made by the planning Commission ranged from 225 million tonnes to 243 million tonnes. The actual production of foodgrains in 2006-07 was, however, only 217.3 million tonnes.
Agricultural Sector:
Performance of the First Plan on this front was satisfactory. Production of foodgrains rose from 54 million tonnes in 1950-51 64.8 million tonnes in 1955-56 against the target of 61.6 million tonnes. Target for foodgrains production was kept at 75 million tonnes in the Second Plan, while achievement was 76 million tonnes.
The performance of the Third Plan on the agricultural front can be considered quite unsatisfactory keeping in view the fact that achievements were below targets for most of the crops.
In line with the New Agriculture Policy 2000 which envisaged a growth rate exceeding 4 per cent per annum in the agricultural sector, the Tenth Plan aimed at a 4 per cent per annum growth. The demand for foodgrains was put 236 million tonnes by the end of Plan, i.e., 2006-07, while the supply projection for foodgrains in that year made by the planning Commission ranged from 225 million tonnes to 243 million tonnes. The actual production of foodgrains in 2006-07 was, however, only 217.3 million tonnes.
The first year of the Eleventh Plan, 2007-08, recorded a foodgrains production level of 230.8 million tonnes which rose further to as high as 259.3 million tonnes in 2011-12, the last year of the Eleventh Plan. The agricultural sector, as a whole, registered an impressive growth rate of 4.1 per cent per annum in the Eleventh Plan which was higher than the targeted rate of growth of 4.0 per cent per annum.
Production of foodgrains in the first year of the Twelfth Plan, 2012-13 stood at 257.1 million tonnes which rose to 265.0 million tonnes in 2013-14. It was 252.0 million tonnes in 2014-15 and 251.6 million tonnes in 2015-16. Foodgrains production in 2016-17 (the last year of the Twelfth Plan) rose to 275.7 million tonnes –the highest level recorded so far.
Balance of Payments:
Right from the beginning of the First Five-Year to 1991-92 (excepting 1972-73 and 1976-77 when there were small surpluses of 103.4 crore and rs 68.9 crore respectively), the balance of trade has always been against India. For most part of the planning period, net income from invisibles has been positive but it has been too meagre to outweigh the deficit in balance of trade. Thus, balance of Payments has also been against India and the gap has had to be filled up through foreign aid.
During the Ninth Plan period, current account deficit was RS 53,175 crore as against the projected deficit of RS 1,59,800 crore. In fact, India’s external sector preformed credibly during the Ninth Plan period. There was a surplus on current account of RS 16,426 crore in 2001-02—the last year of the Ninth Plan. The next two years (2002-03 and 2003-04) which were the first two years of the Tenth Plan, also witnessed a surplus on current account of as much as RS 94,643 crore. It was for the first time in the post -Independence period that there was a current account surplus for three consecutive years.
Saving and Investment:
A study of the data of the Five-Year Plans for the planning period indicates a steady rise in the rates of gross domestic saving and gross domestic investment during the first three plans. In 1950-51, the rate of investment and the rate of saving were estimated to be 9.3 per cent and 9.5 per cent respectively of GDP.
The gross domestic saving rate for the last year of the Tenth Plan, i.e, 2006-07, was 34.6 per cent while gross domestic capital rate in 2007-08 (the first year of the Eleventh Plan) was 36.8 per cent while investment rate was 38.1 per cent. These are the highest rates recorded in the entire planning period. In 2015-16, the gross domestic saving rate was 32.3 per cent and investment rate was 33.3 per cent (on the basis of the new series with 2011-12 as the base year).
Conclusion: A Journey Unfolding
India’s Five-Year Plans have not just been documents on paper; they are narratives of resilience, adaptability, and progress. From the agrarian landscapes of the Green Revolution to the digital frontiers of the 21st century, each plan has left an indelible mark on the nation’s trajectory.
As we reflect on the past and chart the course for the future, the Five-Year Plans serve as a compass, guiding India through the ebbs and flows of development. The targets achieved and lessons learned are the building blocks of a nation that continues to evolve, adapt, and strive for a brighter tomorrow.
“Driving Progress: Unveiling the Accomplishments of Economic Planning in India”
From the early days of independence to the present, meticulous economic planning has played a pivotal role in shaping India’s growth story. Let’s delve into the remarkable accomplishments that have unfolded as a result.
Eradicating Poverty: A Herculean Endeavor
One of the most significant accomplishments of economic planning in India has been the relentless pursuit of poverty eradication. The planning process has strategically focused on inclusive growth, ensuring that the benefits of development reach the grassroots. Schemes like the National Rural Employment Guarantee Act (NREGA) have provided a social safety net, offering employment opportunities to millions and lifting them out of poverty.
Infrastructure Overhaul: Building the Backbone of Growth
Five-Year Plans of Economic planning in India has emphasized the importance of robust infrastructure as a catalyst for economic development. From expanding the road network to modernizing ports and airports, the planning framework has driven infrastructural growth. Initiatives like the Pradhan Mantri Gram Sadak Yojana have connected remote areas, fostering economic activities and improving accessibility.
Agricultural Revolution: From Subsistence to Surplus
Agriculture has always been the backbone of India’s economy. Economic planning has successfully navigated the challenges in this sector, ushering in the Green Revolution. Strategic interventions in the form of improved irrigation facilities, high-yielding seeds, and agricultural extension services have transformed India from a food-deficit nation to a surplus producer, ensuring food security for its vast population.
Industrialization and Economic Diversification
Economic planning has played a crucial role in steering India towards industrialization and economic diversification. By promoting a mix of large-scale industries and small and medium enterprises (SMEs), planners have aimed at balancing economic growth across sectors. This diversification not only creates employment opportunities but also reduces dependency on a single sector, making the economy more resilient.
Technological Leap: From IT to Innovation
In the era of globalization, economic planning has fueled India’s technological leap, particularly in the Information Technology (IT) sector. Policies encouraging foreign investments, coupled with a focus on education and research, have turned India into a global IT hub. The nation is now not just a consumer but also a creator of cutting-edge technologies, contributing to innovation and economic sustainability.
Social Welfare: Prioritizing Human Development
Economic planning in India has extended beyond traditional economic indicators to prioritize human development. Schemes like the Sarva Shiksha Abhiyan (Education for All) and the National Health Mission have focused on enhancing the quality of life. Improvements in literacy rates, healthcare accessibility, and overall well-being showcase the success of these initiatives in fostering a socially inclusive development paradigm.
Global Integration: Navigating the Seas of Globalization
Economic planning has facilitated India’s integration into the global economy. Liberalization and globalization policies have opened doors for foreign investments, boosting trade and creating a more interconnected world. By participating actively in international forums, India has not only gained global recognition but has also contributed significantly to shaping the discourse on sustainable development.