Model Answer
0 min readIntroduction
India’s journey with economic planning began with the establishment of the Planning Commission in 1950, modeled after the Soviet system. This centralized body was instrumental in formulating Five-Year Plans, allocating resources, and setting national priorities. However, with economic liberalization in 1991 and the increasing complexities of a rapidly changing global landscape, the limitations of the centralized planning model became apparent. In 2015, the NITI Aayog (National Institution for Transforming India) replaced the Planning Commission, signaling a shift towards a more decentralized, bottom-up approach. The assertion that NITI Aayog has ‘broken the edifice of planning into fragments’ necessitates a critical examination of its structure, functions, and impact on India’s developmental trajectory.
The Traditional Planning Model: A Centralized Approach
The Planning Commission operated on a top-down approach, with a strong emphasis on centralized control and resource allocation. Key features included:
- Five-Year Plans: Formulated comprehensive plans covering all sectors of the economy.
- Resource Allocation: Determined the allocation of funds to various states and sectors.
- Model-Based Planning: Relied heavily on economic models and projections.
- Sectoral Focus: Prioritized specific sectors deemed crucial for economic growth.
While this model contributed to significant achievements in areas like industrialization and poverty reduction, it also faced criticism for being rigid, bureaucratic, and unresponsive to changing needs. The 8th and 9th Five Year Plans faced significant setbacks due to changing global and domestic economic conditions.
NITI Aayog: A Shift in Paradigm
NITI Aayog was envisioned as a think tank that would foster a collaborative and competitive spirit among states. Its key features include:
- Decentralized Planning: Promotes state-led development and encourages states to formulate their own strategies.
- Bottom-Up Approach: Emphasizes the importance of local needs and priorities.
- Focus on Innovation: Encourages innovation and entrepreneurship.
- Policy Formulation: Provides policy advice and recommendations to the government.
- Cooperative Federalism: Aims to strengthen the relationship between the center and the states.
Fragmentation or Transformation? Evaluating the Argument
The argument that NITI Aayog has broken the edifice of planning into fragments holds some validity. The dismantling of the Five-Year Plan framework and the absence of a centralized resource allocation mechanism have led to a degree of fragmentation. Several points support this claim:
- Lack of National Vision: The absence of a comprehensive national plan can lead to a lack of coordination and coherence in development efforts.
- Increased Regional Disparities: Without a centralized mechanism for resource allocation, there is a risk of exacerbating regional disparities.
- Duplication of Efforts: States may pursue similar initiatives without proper coordination, leading to duplication of efforts.
However, it is also important to recognize the positive aspects of the new approach. NITI Aayog has facilitated:
- Greater State Autonomy: States have greater flexibility to pursue their own development priorities.
- Improved Policy Formulation: NITI Aayog has played a crucial role in formulating important policies such as the Sustainable Development Goals (SDGs) index and the Aspirational Districts program.
- Enhanced Competition: The competitive spirit among states has led to increased innovation and efficiency.
Comparing Planning Commission and NITI Aayog
| Feature | Planning Commission | NITI Aayog |
|---|---|---|
| Approach | Top-down, Centralized | Bottom-up, Decentralized |
| Planning Framework | Five-Year Plans | No fixed-term plans; Vision Documents & Strategy Frameworks |
| Resource Allocation | Centralized allocation | State-led allocation |
| Role | Formulate & Execute Plans | Think Tank, Policy Advisor |
The Aspirational Districts program, launched in 2018, exemplifies NITI Aayog’s approach. It aims to rapidly transform 115 districts across India based on key development indicators. While the program has shown some positive results, its long-term impact remains to be seen.
Conclusion
In conclusion, while NITI Aayog has undeniably dismantled the traditional edifice of centralized planning, characterizing this as simply ‘breaking it into fragments’ is an oversimplification. The shift represents a fundamental change in the approach to development, prioritizing state autonomy, innovation, and cooperative federalism. The absence of a comprehensive national plan does pose challenges, but the increased flexibility and responsiveness of the new system offer potential benefits. The success of NITI Aayog will ultimately depend on its ability to effectively coordinate state efforts, address regional disparities, and provide a clear vision for India’s future development.
Answer Length
This is a comprehensive model answer for learning purposes and may exceed the word limit. In the exam, always adhere to the prescribed word count.