Economic planning

1. Economic planning Introduction: “planning is deciding in advance what is to be done. When a manager plan, he project a course of action for the future, attempting to achieve a consistent,co-ordinated structure of operation aimed at the desired result.”

2. Nature , concepts and types of plan Planning is universal and every business unit has to plan its economic activity. Planning lays down the mean to achieve objectives. Planning is an intellectual process and requires mental exercise. Planning is always a continuous and perpetual process and if circumstances changes and modifications are regularly done in the planned course of action on account of changes in environment.

3. Features of planning • Democratic : India being the largest democratic country in the world has been maintaining such a planning set up where every basic issues related to its five year plan is determined by a democratically elected government. • Decentralised planning: decentralised planning is a kind of percolation of planning activities or process from the centre to the sub-state levels,district,sub-division,block and village level.

4. Existence of central plan and state plan :Central plan is under the exclusive control of the planning commission and the central government whereas the state plan is under the exclusive control of state planning board and state government which also requires usual approval from the planning commission. • Public sector and private sector plan:public sector investment and private sector investment amount is separately fixed,which comprises the total investment in each plan.india,being a mixed economy,it is quite natural that a separate investment outlay for public as well as the private sector is being maintained in each plan.

5. Periodic plan:this type of periodic plan approach is quite suitable for realising its definite targets.the system of annual plan has provided the facility for making necessary modification in the plan outlay,allocation and targets. • Basic objectives: the major objectives of economic planning in India mostly consists of economic growth,economic inequalities,full employment,modernisation,redressing the imbalance in the economic.

6. Unchanging priorties:India are determining its priorities considering the needs of the country.its is being observed that India giving too much priorities the development industry,power and agriculture with minor modification. • Balanced regional development: development of backward regions is one of the important objective of India planning.

7. Planning on basic issues: another important feature of Indian planning is that it has adopted the system of perspective planning on some basic issues of the country. • Implementation and eveluation:programme implementation machinery includes various government department which are usually involved for the implementation of the plan.there is evaluation machinery which usually conduct pre-project evaluation of every planning project of the country.

8. Objectives of planning • Economic growth: as the economy of the country was suffering from acute poverty, thus by attaining a higher rate of economic growth eradication of poverty is possible and the standard of living of our people can be improved. • Economic equality and justice: reduction of economic inequalities and eradication of poverty are the second group of objective.

9. Full employment:the generation of more employment opportunities was considered as an objective of both the 3rd and 4th plan of our country. • Economic self-reliance:when the plan aimed at elimination of the import of food grains under PL480.

10. Modernisation of various sector:our country was the modernisation of various sector and more specially the modernisation of agricultural and industrial sectors. • Redressing imbalances in economy: regional development mean economic development of all the regions by exploiting various natural and human resources and by increasing their per capita income and living standard.

11. Kinds of planning • Basic plan:the entire planning activity is geared into action through the formulation of objectives and strategies. • Standing planning:serves as a guide line to managerial action.it include policies and procedures which have application only in repetitive action. • Master plan:the complete course of action along with timing and strategy consideration.

12. Steps in planning • Objectives:objectives are the ends towards which the activities of an enterprise are directed. Objectives are the action commitments through which is received universal attention of the planning. • Targets production, consumption and distribution:timing is an essential consideration in economic planning. The starting and finishing time are fixed for each piece of work so as to indicate a good production.

13. Securing participation: the participation of the subordinates has been found to be of extreme importance. participation improves the quality of planning through the knowledge facts. • The use of strategy:startegy involves as to how available resources will be used to achieve objectives. it also mean a particular kind of policy.

14. Techniques of planning • Democratic planning: this is also known as planning by inducement. democratic plan need not be a comprehensive plan. under democratic planning technique, objective may be achieved by techniques of persuasion and not by order, command and threat. India has a very complex mixed economic system, here democratic plan plays a vital role. The government authority interferes with the working of the price system only to promote social welfare.

15. Planning by direction: it involves the system of orders, commands which shall be observed. here, determine policies for the group without consulting them and dose not give detailed information about future plan but simply tell the group what immediate steps the member must take. production targets for every industry is fixed. this technique of planning can also be positive because the production unit may use his power to disperse rewards to group. this may be effective in getting higher productivity in many situations and developing effective human relationship.

16. Planning commission The planning commission of India was set up for the first time in march 1950 with pt. Jawaharlal Nehru as its chairman. • The commission is composed of 8 member • prime minister • Four full time members • Minister of planning • Minister of finance • Minister of defence

17. Function of planning commission • Making real assessment of various resources • Formulation of a plan • Determining plan priorities • Economic growth • Determining plan machinery at each stage of planning process • Finally making ancillary recommendations as and when necessary.

18. National development council It is working as the highest national forum for economic planning in India since 6th august 1952.it representatives of both the central and state government sit together to finally approve all important decision relating to planning. • Members are: • Prime minister of India • All state chief minister • Members of planning commission.

19. Function of NDC • To make periodical review of the national plan at different time. • To consider important question related to social and economic policy affecting national development. • It also taking a final decision regarding allocation of central assistance for planning among different states. • NDC approves the draft plan prepared by planning commission of our country.

20. Thanking you Submitted by: Chandan Verma BBA II 734 Submitted to: Sarabjeetmam