making assessment of all resources of the country augmenting deficient resources, formulating
plan for the most effective and balanced utilization of resources and determining priorities.
Jawaharlal Nehru was the first chairman of the Planning Commission.
Keeping in view the large-scale import of food grains in 1951 and inflationary pressures on
the economy, the First Plan (1951-56) accorded the highest priority to agriculture including
irrigation and power projects. About 44.6 per cent of the total outlay of ₹ 2,069 crore in the
public sector (later raised to ₹ 2,378 crore) was allocated for this purpose. The Plan aimed at
increasing the rate of investment from five to about seven per cent of the national income.
The Second Five-Year Plan (1956-57 to 1960-61) sought to promote a pattern of
development, which would ultimately lead to the establishment of a socialistic pattern of society
in India. Its main aims were (i) an increase of 25 per cent in the national income; (ii) rapid
industrialization with particular emphasis on the development of basic and heavy industries; (iii)
large expansion of employment opportunities; and (iv) reduction of inequalities in income and
wealth and a more even distribution of economic power. The Plan aimed at increasing the rate of
investment from about seven percent of the national income to 11 per cent by 1960-61. It laid
emphasis on industrialization, increased production of iron and steel, heavy chemicals including
nitrogenous fertilizers and development of heavy engineering and machine building industry.
The Third Plan (1961-62 to 1965-66) aimed at securing a marked advance towards self-
sustaining growth. Its immediate objectives were to: (i) secure an increase in the national income
of over five per cent per annum and at the same time ensure a pattern of investment which could
sustain this rate of growth in the subsequent Plan periods; (ii) achieve self-sufficiency in food
grains and increase agricultural production to meet the requirements of industry and exports; (iii)
expand basic industries like steel, chemicals, fuel and power and establish machine building
capacity so that the requirements of further industrialization could be met within a period of
about 10 years mainly from the country’s own resources; (iv) fully utilize the manpower
resources of the country and ensure a substantial expansion in employment opportunities; and
establish progressively greater equality of opportunity and bring about reduction in disparities of
income and wealth and a more even distribution of economic power. The Plan aimed at
increasing the national income by about 30 per cent from ₹ 14,500 crore in 1960-61 to about ₹
19,000 crore by 1965-66 (at 1960-61 prices) and per capita income by about 17 per cent from
330 to 386 over the same period.
The situation created by the Indo-Pakistan conflict in 1965, two successive years of severe
drought, devaluation of the currency, general rise in prices and erosion of resources available for
Plan purposes delayed the finalization of the Fourth Five Year Plan. Instead, between 1966 and
1969, three Annual Plans were formulated within the framework of the draft outline of the