4.2        ndian    onom
                                                         and income distribution, in accordance with
        IntroductIon                                     social objectives set by bodies representative of the
     In order not to limit the discussion on economic    nation. Such planning is not only to be considered
     planning to just an academic exercise, we need to   from the point of view of economics, and raising
     discuss it taking real life examples from different of the standard of living, but must include cultural
     economies. Without a historical background to       and spiritual values, and the human side of life.”1
     planning, we would not be able to understand the         By the late 1930s, there was an almost
     meaning and role of planning in India. This small   political consensus that independent India will
     chapter intends to introduce the reader to all the  be a planned economy. As India commenced
     whats, hows and whys of the concept of economic     economic planning by the early 1950s, the
     planning with due recourse to the experiments by    planning commission of India also went on to
     different countries from time to time, including    define planning. According to the Planning
     India. It could also be considered a theoretical    Commission, “Planning involves the acceptance
     backgrounder for the next chapter, Planning in      of a clearly defined system of objectives in terms
     India.                                              of which to frame overall policies. It also involves
                                                         the formation of a strategy for promoting the
        defInItIon                                       realisation of ends defined. Planning is essentially
                                                         an attempt at working out a rational solution of
     A number of definitions have been forwarded by      problems, an attempt to coordinate means and
     different economists from time to time since the    ends; it is thus different from the traditional
     term ‘planning’ entered the domain of economics.    hit-and-miss methods by which reforms and
     To make us develop a clear understanding of         reconstruction are often undertaken”.2
     planning, we need to see only a few of them which        In the post-War period, a large number of
     will enable us to draw out a working definition     the newly independent countries were attracted
     that fits contemporary time.                        towards planning. Many new forces of change
          A large number of economists and experts       kept refining the very idea of planning due to the
     have agreed that perhaps the best definition is     compulsive necessities of industrialisation or the
     given by H. D. Dickinson, according to whom,        issue of sustainability of the development process.
     economic planning is, “the making of major          But to carry forward our discussion, we need a
     economic decisions—what and how much is to          working as well as a contemporary definition
     be produced and to whom it is to be allocated by    of planning. We may define it as a process of
     the conscious decision of a determinate authority,  realising well-defined goals by optimum utilisation
     on the basis of a comprehensive survey of the       of the available resources.3 While doing economic
     economic system as a whole.”                        planning the government sets developmental
          It was the National Planning Committee,        objectives and attempts to deliberately coordinate
     set up in 1938 by the Indian National Congress
                                                            1.   S. R. Maheshwari, A Dictionary of Public
     which, for the first time, tried to define planning         Administration, orient longman, New Delhi, 2002,
     (in 1940, though, its final report was published in         p. 371.
     1949) in India. It could be considered the broadest    2.   Planning Commission, First Five Year Plan (1951–56),
     possible definition of planning: “Planning, under           Government of India, New Delhi, 1991, p. 7.
     a democratic system, may be defined as the             3.   After the emergence of the concept of Sustainable
                                                                 Development (1987) experts across the world started
     technical coordination, by disinterested experts            using the term ‘optimum’ in place of the hitherto used
     of consumption, production, investment, trade,              term ‘maximum’.