Politics Of Planning

‘‘Planning in India’’

Banhi Baran Ghosh

The Planning Commission did not wither away; it was obliterated; and the commissioning of NITI AAYOG has shrouded the avowed practice of economic planning. Be that as it may, it is prudent to judge India's economic plans not in terms of their 'promises' and "undoing" but, by an approximation of how far the germination of the idea of planning was conceivable in a situation in which alternative to planning was deemed irreconcilable. Further, the onus is on the posterior attempts towards making in appraisal of the devolution of the idea of planning in an environment epitomised by the stream of arguments about the techniques, philosophy and intention of planning—an environment within which planners had to take decisions since getting away with planning at that particular juncture did not withstand merit.

It may be recalled that when the Planning Commission was set up on March 15, 1950 following the final draft of the Cabinet resolution it strove to bear upon the preparation of a plan on the three premises, that the citizens, men and women equally, have the right to an adequate means of livelihood ; that the ownership and control of the material resources of the community are so distributed as best to subserve the common good and that the operation of the economic system does not result in the concentration of wealth and means of production to the common detriment.

It was the time when the Economy was haunted by the terrible experience of its just colonial past besieged by unbridled inflation, far-flung corruption, intensive black-marketing and abominable famine of 1943 inflicted upon by the Great War. Going back further, the beleaguered colonial economy was characterised by the less than 2% a year rate of growth of the aggregate output during the first hall of the 20th century and per capita output registering half a percent rate of growth. The rate of growth of GDP by primary, secondary and tertiary sectors was 0.4%, 1.5%, 1.7% respectively during 1900-01 to 1946-47. At the time of independence nearly 85% of the people lived in villages and earned their livelihood from agriculture and industries employed one sixth of the labour force; illiteracy was 84%, mortality rates were very high (27 per 1000) and the ‘Cambridge Economic History of India’ delineated that the unequal distribution of resources between groups and regions aggravated the problems relating to poverty, ignorance and disease.[1]

The idea of planning was bestowed upon the architects of modern India out of 'ideological mellowness' imbued with the inclination for democratic principle, inspiration derived from the Soviet Planning experience and these apart, to confer upon the State the central role to be played in resolving agenda for economic development, a role by which omnipotent character of the State had to be juxtaposed with the practice of democratic norms for transforming India from a 'civilisation of classical antiquity to a modern-nation state'. This was exacerbated by the growing antipathy, in the world, to the free-market private-enterprise economy that lent credence to evolving world of imperfect competition invoked through the works of Joan Robinson and E H Chamberlin and "General Theory of Employment, Interest and Money" of J M Keynes by which the neo-classical theory of economic policy was made redundant. In no time, the philosophy of planning became coterminous with the doctrine of industrialisation since it was felt that through industrialisation the country would gain the stimulus for moving along the growth path—the panacea for removal of poverty and inequality and improvement of standard of living of the masses. The incentive came almost certainly from Soviet style of industrialisation which was recognised, when the planning ushered in, as the only means to dispense with the individual enterprises having recourse to technical revolution in productive methods and to overcome the ravages caused by war. The ultimate objective was to raise national income that would eventually call forth an improved standard of living. However, the plans for Industrial reconstruction in the then Soviet Union were followed by the programme of agricultural collectivisation treated in the history as one of the dauntless economic revolutions the world had ever seen. The basic argument was that the industry could not have gathered momentum unless backed by increasing agricultural surplus in the form of food and raw materials that could supplement industrial population and also as export surplus for purchasing constructional equipment from abroad. The architects of planning in India flunked to espouse the prerogative. This might be attributed to the fact that Indian agriculture, on the eve of independence, was dominated by a few zamindars owning the major share of land most of which was exposed to unproductive use and secondly, the planners might have been obsessed with the 'dream' of establishing 'socialist' society only in line with ascribing the State the sole custodian of the commanding heights of the economy.

The believers in socialist path, mainly Subhas and Nehru, had to confront a serious debate on three premises: first, the implementation of the two-pronged strategy of invoking land reforms by which the excess land in the hands of the zamindars had to be taken away so that it could be distributed among the landless and tenancy rights of the latter had to be secured without which the incentive to grow more crops could not be provided; secondly, alongside the existence of various small scale industries it had to be assured that the commissioning of the large scale industries did not push these small units near extinction and thirdly, a few large industrial houses were already there in the economy before independence which should not be allowed to be handicapped while choosing the socialist path through building up of the public sector under the aegis of which the large scale industries were founded and planned to be directed.

The concerted efforts of planning and industrialisation had to confront serious remonstration that came from Gandhi. The latter had a profound belief that this would weaken the foundation of Indian village community and the small and cottage industries would relinquish under the threat from the large scale and heavy industries. Gandhi believed that the economic progress based upon heavy industrialisation would eventually pave the way for exploitation. That the people of India should not get riddled with this stiff opposition from Gandhi and his followers Nehru pointed out that for welfare of the people of India it was necessary to develop the cottage industries in large scale but at the same time he did not miss the point that welfare depended on the achievement of the political as well as economic freedom of which there was no alternative to heavy industrialisation and without economic freedom the building up of the cottage Industries in large scale was a distant hope.

The long history of planning in India is a narrative of the struggle against not shirking but, contending with the odium and embarrassment stemming from the alleged critique of describing the effort of planned development in terms of the logic of pressure group, the establishment of the hegemonic projection of goals and aspirations of the bourgeoisie in a transitional economy to be accepted voluntarily by the rest of the society. At another remove, the state, while exercising planning, was alleged to be the instrument of primary accumulation of capital in its attempt to strengthen the industrial base (which centered on the modern urban sector) at the expense of extracting surplus from the rural sector. Alongside this, the unveiling of the metamorphic role of the state got pronounced that became evident by its will to get connected to the people-nation not simply by subscribing to the forms of representative government based upon adult suffrage but by dint of a crucial modality of power, expressed in directing a programme of economic development via planning.[2]

The fundamental ideology of planning that it would help the country achieve self-reliance was best reflected in a coherent form till the middle of the 1960s until the wars, droughts and subsequently the pressures from the propertied classes backed by the international lobbies associated with the US Government succeeded in abandoning the framework of planning which though, was reinstated, lost the vigour and spirit embedded in the past.[3]

Writing in the late 1980s Sukhamoy Chakravarty left a note of caution—"Neither the recently discussed virtues of the free market mechanism nor the earlier panacea of central planning would appear to carry much conviction today. Societies grow in historical time characterised by irreversibilities, and 'history does not perform controlled experiments for our benefit......... However, the need for flexible adaptable operating mechanisms is very much there.... there has to be a much greater degree of political consensus on what is attempted. India benefited from this in the first decade of planning. It is still greatly needed in the remaining years of this century. No facile conclusion is warranted".[4]

NITI AAYOG was inflicted upon as a means to better serve the needs and aspirations of the people of India in a changing environment surrounded by the blooming market economy, growing prospect of the Indian economy to contribute to the global dynamics and evolving States of the Union of India from being mere appendages of the Centre, to being the actual drivers of national development. Let us be hopeful yet the questions persist—'better' relative to what? Who are the 'people'? What are these 'needs' and 'aspirations'? Whose needs? Whose inspirations? Resolving these issues required meaningful discussion and debate, instead the country experienced sudden demise of planning in India although the history of planning in this country abounds with that archetype of discussion and debate.

An extended discussion is pending and it is not futile to remember what Richard S Eckaus remarked while writing about planning in India in the late 1960s—"Indian planning is an open process. Much of the controversy and the debates that accompany the preparation of the plans are public. The initial aggregate calculations and assumptions are either explicitly stated or readily deducible, and the makers of the plans are not only sensitive but responsive to criticism and suggestions from a wide variety of national and international sources. From original formulation through successive modifications to parliamentary presentation, plan making in India has evolved as a responsive democratic political process".[5]

1.      Cambridge Economic History of India (1983), Vol.2.
2       Chatterjee, Partha (1998): Development Planning and the Indian State in Partha Chatterjee (ed) "Slate and Politics in India", 271-298, Oxford University Press, New Delhi.
3.      Bagchi, Amiya Kumar (1984) : "Towards a Political Economy of Planning in India", Contributions to Political Economy, 3, 13-38.
4.      Chakravarty Sukhamoy (1987): Development Planning: the Indian Experience, Oxford University Press, New Delhi.
5        Eckaus, Richard S : Planning in India. 1967,

Vol. 50, No.23, Dec 10 - 16, 2017