In the context of five-year plans, which of the following can be regarded as basic objective of planning in India?

I. A sizeable increase in the national income so as to raise the level of living in the country.

II. Reduction of inequalities in income and wealth and a more even distribution of economic power.

Correct option is C

The correct answer is (c) Both I and II

Explanation:

The basic objectives of Five-Year Plans in India have consistently focused on inclusive economic development. Two of the most fundamental goals across almost all plans were:

• I. A sizeable increase in national income:
  One of the core aims of planning was to increase the national income to improve the standard of living, promote employment, and foster economic growth. This aligns with the broader goal of achieving self-reliance and reducing poverty.
• II. Reduction of inequalities in income and wealth:
  Another major goal was to ensure equity and social justice by reducing disparities between the rich and poor, urban and rural areas, and different regions. A more even distribution of economic power was viewed as essential for the stability and sustainability of economic progress.

Hence, both statements are correct and reflect the twin goals of growth with equity.

Information Booster:

History and Concept of Five-Year Plans (FYPs) in India

Historical Background

• The idea of planned economic development gained traction in 1940s–50s, as a method to rebuild and modernize post-colonial economies.
• In 1944, prominent industrialists drafted the Bombay Plan, advocating for a planned economy in India.
• Inspired by global trends, particularly the Soviet Union’s Five-Year Plans initiated by Joseph Stalin in 1928, India adopted the model post-independence.
• Post-1947, planning was seen as essential for balanced development and nation-building.

Concept of Five-Year Plans

• Five-Year Plans are comprehensive documents outlining the Government of India’s economic goals, income, and expenditure over a five-year period.
• Government budgets were bifurcated into:
• Plan Budget – Allocated for development programs under the Five-Year Plan.
• Non-Plan Budget – Allocated for routine expenditures (e.g., salaries, subsidies).
• The plans focused on prioritizing sectors such as agriculture, industry, education, and health based on national needs.

Implementation and Institutional Framework

• From 1951 to 2017, India operated under a planned economic model, guided by Five-Year Plans.
• The Planning Commission, established in 1950, was responsible for formulating, implementing, and monitoring these plans.
• In 2015, the Planning Commission was replaced by NITI Aayog (National Institution for Transforming India).

New Planning Approach under NITI Aayog

• NITI Aayog shifted the planning paradigm from rigid five-year targets to flexible and adaptive frameworks.
• It introduced three key planning documents:
• 3-Year Action Agenda
• 7-Year Strategy Document
• 15-Year Vision Document

These changes reflect a shift from centralized planning to a more market-oriented, cooperative federalism-based approach to development.

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