Soon after India became independent in 1947, long-term economic plans were envisaged for greater development. Under the five year plans different programmes for development of the country have to be completed within stipulated period. These plans have clear aims and objectives and prepared with the intention of achieving all-round development of the country as well as self-reliance.
For this purpose a Planning Commission was set up in March 1950. The commission drew up the country’s first five year plan in April 1951. To coordinate its activities, the most important policy-making body was associated with the Planning Commission — the National Development Council set up by Govt. of India on 6 August 1952. The Council membership consists of the Prime Minister as Chairman, all Union Cabinet Ministers, and Chief Ministers of all states.
The Planning Commission has since been making five year plans taking into account the resources of the country which are to be used in the most effective and balanced manner. So far, we have eight five-year plans. The first one started in April 1951 and ended in March 1956. The second plan was from 1956 to 1961, the third from 1961 to 1966, the fourth from 1969 to 1974, the fifth plan from 1974 to 1979, the sixth from 1980 to 1985, the seventh from 1985 to 1990. The period 1966-69, however was the period of interim planning. During these years due to some economic and political problems, only annual plans were made instead of a full five year plan. Same procedure was also adopted for the period from 1979 to 1980.
Thrust in the 7th five year plan was an increase of agricultural production for self sufficiency in food, growth in employment, rapid industrial development.
The Eighth five year plan has started from 1992 and to be completed by March 1997. The Eighth plan emphasizes on employment generation, population control, eradication of illiteracy, provision of safe drinking water, poverty alleviation programmes and so on.
It is most important that Eighth Five Year Plan has been launched against the back-drop of significant changes taking place in India and other parts of the world. The policy of trade and economic reforms has been adopted. This makes a fundamental departure from the model of a controlled and centralized economy that has been pursued during the last three decades.
The idea of formulating five year plans was borrowed from the model of Gosplan of USSR which achieved tremendous success in the 30s and 40s. The logic was that a planned economy would bring growth and development for everybody. In recent years, some reforms were required in the modalities of our planning due to the changing national and international economic scene.