Tag Archive | Planning Commission

Why is India better off without Planning Commission?

Planning Commission

Planning Commission

  • Planning commission is an advisory body with wide budgetary powers where members are appointed without any specific criteria.
  • Deputy Chairman of the planning commission holds the rank of a cabinet minister without being subject to any parliamentary control unlike the other ministers of cabinet.
  • There is overlapping of functions with other specialized agencies like Finance Commission, National Development Council. (for instance preparation of reports)
  • Dominant status of private players now, unlike the time when the commission was set up and a huge amount of gross investment came from solely government sources.
  • While allocating funds at ground level, Planning Commission often overlook the requirements and concerns of the local area or people.
  • There is an unscientific distinction between plan and non-plan expenditure used by the commission.

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Industry Vs. Agriculture: Prime Moving Force Debate

Soon after the independence, the Indian government selected industry to be the prime moving force of the Indian development. However, there was a great debate over this choice, as agriculture was thought to be more suitable for the role of the prime moving force in India.

The selection of industry as the prime moving force was also questioned as:

  1. There was almost an absence of infrastructure sector, like- power, transport, and communication, in India;

  2. There was also a negligible presence of infrastructure industries, like Iron & Steel, Cement, Coal, Crude Oil, Oil Refinery and Electricity;

  3. Lack of investible capital;

  4. Absence of required technology to support industrialization. There was also no R&D in India;

  5. Lack of skilled manpower;

  6. absence of entrepreneurship among the Indian masses;

  7. Absence of the market for the industrial goods.

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14th Finance Commission: Some Challenges

The Constitution provides for a Finance Commission under Article 280, in order to facilitate the mechanism of transfer of funds and resources between the Centre and states. The Finance Commission is to address the vertical imbalance- between Centre and states- as well as the horizontal imbalances- the one between the states with varying degree of fiscal capability but similar responsibilities.

The 14th Finance Commission was announced in 2013, with Y. V. Reddy as its Chairman. It’s recommendations would be applied for the period 2015-16 to 2019-20.

An important issue, which has given birth to several debates, is the growing dominance of the centre at the cost of the autonomy of the states. Read More…