Facts about Five Year Plans in India

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First Five Year Plan (1951-1956)

  • First plan was based on Herold-Domar Model.
  • Its immediate goal is the cure of refugees, speedy agricultural expansion so as to get food self-sufficiency in the shortest probable time and control of inflation.
  • Plan achieved the growth rate of 3.6%, which was more than its aim.
  • Increase 18% growth in national income and 11 % growth in per capita income.
  • Introduction of First Five Year Plan prepared by Dr. K.N. Raj
  • National Development Council implemented during First Plan.
  • A number of river valley and multipurpose projects were undertaken like Bhakra Nangal, Damodar Valley, Hirakud Valley Projects etc.

Second Five Year Plan (1956-1961)

  • This plan was based on P.C. Mahalanobis Model Development.
  • Industries and Minerals were on top priority.
  • Second priority: Transport & Communication.
  • Plan achieved 4.1% rate of growth.
  • Three important Steel Plants of 10 lakh tonnes capacity established during this period - Rourkela, Bhilai and Durgapur Steel plants.
  • Green Revolution started during this Plan.

Third Five Year Plan (1961-1966)

  • This plan is also called Gadgil Yojana.
  • It is emphasized on Agricultural production and Industry in order to secure self sufficiency in food grains and to meet the requirements of exporting industry. This plan could not achieve its aim of 5.6% growth rate.
  • The main reason for failure of this plan is Indo-China war, Indo-Pakistan war and unprecedented drought.
  • Plan Holiday (1966-67 to 1968-69). The down of the Third Plan forced the Indian Government to announce 'Plan Holiday.
  • Three Annual Plans were drawn in this intervening period.
  • The main reason of plan holiday is Indo-Pakistan War, lack of resources, devaluation of currency and increase in price level.

Fourth Five Year Plan (1969-1974)

  • Objectives: to achieve growth with stability, to raise standard of living, to raise investment, increasing of agricultural production, to promote social justice and equality.
  • Nationalisation of banks (1969) and India's first nuclear explosion (1972) were the major steps during this period.
  • It achieved only 3.3% annual rate of growth as against its aim of 5.7%

Fifth Five Year Plan (1974-1979)

  • This plan is associated with 'Indira Gandhi's slogan of ‘Garibi Hatao' (remove poverty).
  • Growth rate target was fixed at 5.5%, however, it was amended to 4.4% later on.
  • Indira Gandhi launched the 20 point programme during this plan. The plan was terminated by the Janatha Government in the year 1978.
  • Rolling Plan (1978-1980): It is the continuation of the terminated Fifth Plan. The concept was introduced by Gunnar Myrdal in his famous work, Asian Drama. It was implemented by Janata Party Govt. The First country to adopt this plan is Sweden.

Sixth Five Year Plan (1980-1985)

  • The Janata Government originally introduced this plan for the period 1978-1983, but later a new Sixth Plan replaced it, for the period 1980-85.
  • During this period the Indian economy made all round progress and most of the targets fixed by the Planning Commission were realised. During the last year of the plan (1984-85) many parts of the country faced severe drought conditions.
  • The target growth rate: 5.2% and it achieved 5.7% of annual rate of growth.
  • Integrated Rural Development Programme (IRDP), Minimum Needs Programme (MNP) were started during this plan period.

Seventh Five Year Plan (1985-1990)

  • There was increase in per capita income at the rate of 3.6% per annum.
  • Private sector was given priority during this plan.
  • Employment generating programmes like Jawahar Rozgar Yojana were started during this plan.

Annual Plans:

  • The Eighth Five Year Plan (1990-95) didn’t take off due to the rapid changing political circumstances.
  • The new government (June 1991) decided that the Eight Five Year Plan would commence on Ist April, 1992. 1990-91 and 1991-92 should be considered as separate Annual Plans.

Eighth Five Year Plan (1992-1997)

  • In this plan, top priority was given to 'Development of Human Resources' i.e, Employment, Education and Public Health. As well as to this, the key goal made in this plan was to reinforce the basic infrastructure by the end of the decade.
  • This plan achieved 6.5% annual rate of growth, which was more than its target of 5.6%.
  • Pradhan Mantri Rozgar Yojana (PMRY) was set up in 1993.

Ninth Five Year Plan (1997-2002)

  • It was launched in 50th year of India's independence.
  • It’s priority is given to agriculture and rural development.
  • Plan became unsuccessful to attain the GDP growth aim of 7%. It realized only 5.35% average GDP growth.
  • Main reason for failure of Ninth plan is Recession in international economy.

Tenth Five Year Plan (2002-2007)

  • Growth with human development is the main objective of Tenth Plan.
  • Set out to achieve 7.9% growth rate. It had to satisfy with an actual rate of around 7.7%.
  • The performance of the agricultural sector was not very encouraging. Regional inequalities had only increased and unemployment rate shot up.
  • On the whole, the tenth five year plan did not meet the objective of promoting growth with social justice.

The Eleventh Plan (2007 -12)

  • India's average annual growth rate was 8% compared to the targeted 9 percent.
  • Farm sector grew at an average rate of 3.7 percent as against the targeted 4 percent.
  • The average annual growth rate of the industry was 7.2% against the targeted 10-11 %.

12th Five Year Plan (2012-2017)

  • It had envisaged 9% annual average economic growth rate which was later fixed at 8% by the National Development Council.
  • Areas of main thrust: infrastructure, health and education.
  • The 12th plan seeks to achieve 4 percent agriculture sector growth rate.
  • The 12th plan plans to bring down the poverty ratio by 10 percent.

Models of Economic Development

Nehru-Mahalanobis Model:

  • Nehru-Mahalanobis model of development was adopted during Second Plan. It has continued right up to the eighties.
  • Objective: enlargement of opportunities for the less privileged sections of the society.

Gandhian Model of Growth:

  • The basic objective is to raise the material as well as the cultural level of the Indian masses so as to provide a basic standard of life.
  • It aims at the reform of agriculture.

National Development Council (NDC):

  • National Development Council (NDC) was formed on 6th August, 1952.
  • Ex-officio Chairman is the Prime Minister.
  • Ex-officio secretary is the Secretary of Planning Commission.
  • Members of National Development Council are Chief Ministers of all the states and the members of Planning Commission.
  • It is a constitutional body.
  • Its goal is to create co-operative environment for economic planning among the states and Planning Commission.

LPG Model of Development:

  • LPG: Liberalisation, Privatisation and Globalisation.
  • It was introduced in 1991 by the then Finance Minister Dr. Manmohan Singh.
  • This model was intended to charter a new strategy with emphasis on Liberalisation, Privatisation and Globalisation.
  • It emphasises a bigger role for the private sector.

PURA Model of development

  • PURA is termed as Provision of Urban Amenities and it was for Rural Areas.
  • The Union Cabinet on 20th January, 2004 accorded in principle approval for the execution of PURA.
  • Its objective is to propel economic development without population transfers. It emphasize the enlargement of employment to make use of rural manpower in various development activities.
  • Its concept is response to the need for creating social and economic infrastructure, which can create a conducive climate for investment by the private sector to invest in rural areas.

Planning at a Glance

  • 1951-56 - 1st Plan - Focus on Agriculture
  • 1956-61 - 2nd Plan - Focus on Industry
  • 1961-66 - 3rd Plan - Self Sufficiency in food grains
  • 1966-69 - Plan Holiday - Due to failure of 3rd Plan
  • 1969-74 - 4th plan - Growth, Stability Self reliance
  • 1974-79 - 5th plan - Garibi Hatao (Removal of poverty)
  • 1978 - Rolling Plan
  • 1980-85 - 6th Plan - Comprehensive Growth
  • 1985-90 - 7th Plan - Food grain production, Jawahar Rozgar Yojana
  • 1992-97 - 8th Plan - Economic reforms
  • 1997-2002 - 9th Plan - Developing Basic Minimum Services, Empowerment of women
  • 2002-2007 - 10th Plan - 8% GDP growth
  • 2007-2012 - 11th Plan - Towards faster & more inclusive growth
  • 2012-2017 - 12th Plan - 8% GDP growth