It is not first time any Prime Minister of
India talked about dismantle of Pllaning Commission. The commission was formed
by a resolution of the Government of India March 15,
1950, the commission started presenting the Five Year Plans from 1951 -- disrupted a few times by the India-Pakistan war and drought.
Currently, the panel is overseeing the 12th such plan, 2012-17. Prime Minister Nehru was its first chairman, with Gulzarilal Nanda
as the deputy and V.T. Krishnamachari, Chintaman Deshmukh, G.L. Mehta and
R.K.Patil as members.
High priests of the commission in the 1960s
and 1970s opposed every transformative initiative, including the Green
Revolution and Milk Revolution. Between 1960 and 1980, Malawi grew faster than
India. The political economy has witnessed multiple seizures and failures. The
concerns of the First Five-Year Plan continue to be voiced in the 12th Plan.
Yet the commission survived. Rajiv Gandhi called those at Yojana Bhavan “a bunch of jokers”, but he couldn't dismantle the commission or the “command economy”.
The irony is that the Planning Commission outlived license Raj and thrived two decades
after P V Narasimha Rao had liberated the economy
Milton Friedman who authored the first of
obituaries on the idea of a planned economy.
Friedman, who visited India to study the mixed economy at the invitation of
Jawaharlal Nehru, wrote, “A standard cliché is that India must compress into
decades what took other countries centuries. There is, of course, much merit to
this position.” His conclusion: “India will stretch into centuries what took
other countries decades.” And that is what transpired.
It would be tempting to blame Nehru, his
idealism, the romance of Fabian socialism. It was not just that. Nehru was also
swayed by fact—the defeat of industrialized Germany in World War II by a young
USSR which owed its success to central planning. The commission owed its
genesis to a blinding illusion of the times. Among the most globalized
economies till the 1800s, India’s rulers chose to place faith in the
religiosity of “government knows best” nurtured by high priests led by P C
Mahalanobis. Under Lal Bahadur Shastri, the Planning Commission was cut to size
but his successors restored authority. Thereafter, the commission—despite
failures—continued to define and decide the process of development.
It was a flawed construct. The Centre
allocated resources, the Planning Commission monitored/regulated/directed the
deployment, and the states were tasked with implementation. The Centre had no
responsibility to deliver, the commission no power to enforce and the states
who had little say or incentive felt dumped upon. The Planning Commission represented
a multi-polar disorder in the structure of governance.
The good news is that it has been declared
dead. The worry is that news of its death may be greatly exaggerated. One hears
the government is replacing the commission with a new alphabet soup called NDRF, the National Development and Reforms Commission. Would it be a clone of the Chinese NDRC? The Chinese avatar
has a 15-point charter of 1,180 words (http://en.ndrc.gov.cn/mfndrc/) and is charged with the responsibility of everything from
“strategies of national economic and social development, annual plans, medium
and long-term development plans” to “administration of the State Grain
Administration and the National Energy Administration”. Hopefully, the Modi
Sarkar is not inventing a mutant.
It is abundantly clear that top-down models
militate with the idea of federalism. The critical point here is that the think
tank must assimilate, fund, explore ideas—both bottom up and top down. The
needs are many… mentorship of large infrastructure projects, evaluation groups
that can objectively assess policy, auditors to produce outcome reports on
government spending, methods for real-time updating of social and economic
indicators. India also needs a body to rank states for unemployment, for
inflation management, delivery of services and investment so there is
competition.
There is also great case for sharing best
practices and new ideas. The Gujarat government set up a pilot project that
deployed satellite imagery and an SMS service to tell its fisherfolk where
schools of fish could be found. The induction of technology enabled better
incomes. Can this idea be replicated in all coastal states? Tamil Nadu has successfully
implemented policies that enable and encourage a higher ratio of women in the
workforce. Can other states follow? What are states in the Northeast doing
right to curb malnutrition? How is Himachal Pradesh ramping up literacy? Can
Uttar Pradesh learn horticulture from Maharashtra? There are global practices
too—in skills training—which need to be absorbed. One in four mariners in the
world is from the Philippines. Can India with a 7,500 km coastline learn?
The dismantling of the Planning Commission
offers an opportunity to create a platform for ideas, for evolving solutions to
seemingly intractable issues, for designing systems to enable implementation.
HOW INDIA CAN DO BETTER WITHOUT PLANNING
COMMISSION
1) It is good to get rid from a Planning Commission where the likes
of Montek Singh spent lacs on building toilets for selected few in hi staff
with security systems, and decided that Rs.27/day was enough to live on!!
2) Planning for short medium and long term is indispensable.
Planning for nation building must happen at grassroots level across the country
and not vested in a body which has their head in the clouds
3) Finally get rid of dynasty created bodies. The license raj and
planning commission with corruption and dynasty rule has failed India.
4)
The
Planning Commission itself is not what it was in the era of highly centralized,
predominantly public sector-led planning.
5) The Commission’s role is now largely limited to
formulating long-term growth plans, devising sectoral targets for meeting
these, and acting as an intermediary between the States and Central Ministries.
6) Its approach, too, has changed to one of
‘indicative planning’; aiming at indirectly influencing decisions by market
players rather than fixing mandatory production quotas.
7)
It will
respect the country’s federal structure and emphasize public-private
partnerships (PPP)
8) The internal situation of the country has
changed, global environment has changed... If we have to take India forward,
then states will have to be taken forward. The importance of federal structure
is more today than it was in last 60 years
9) Creative thinking is required for building a
new India with public private partnership and optimum utilization of resources
and power to the states.
10) It is very good idea. Planning has become
outdated concept now. There is a need to modernize it. We have to see the
blueprint of the new concept. But change was very much required as former
Planning Commission member Bimal Jalan said.
11) Several states have complained that the plan
panel, which more or less approves their annual plans, misuses its
discretionary powers, even acting and taking biased politically motivated
decisions.
12) It is clear the Planning Commission in its
current form and function is a hindranc
13) It is not easy to reform such a large ossified
body. It would be better to replace it with a new body that is needed to assist
states in ideas, to provide long-term thinking and to help cross-cutting
reforms," it said.
14) Planning Commission has defied attempts to
reform it to bring it in line with the needs of a modern economy and the trend
of empowering the states, it is proposed that the Commission be abolished
15) India is a complex and diverse country and the
need of the hour are convergent solutions that take a holistic view of problems
while ensuring India’s development and growth are aligned with the interests of
every State, city and village.
16) The need of the hour is also to engage
intellectual talent from outside the system of government so out-of-the-box
ideas can emerge.
17) This new institution should be tasked to come
up with solutions that reflecting convergent thinking that put India’s
interests above partisan and parochial considerations.
18) This new institution should also be challenged
to ensure the solutions it comes up with reflect the interests of the States
keeping with the Federal Spirit of our Constitution.
19) This new institution could also bring about a
marked change in the culture of governance where Ministries and Departments
will cease to operate in silos or at cross purposes
20) It could also mark the end of centralized
planning and one-size-fits-all solutions being scripted from Delhi
21) It could factor local conditions and
constraints to recommend solutions best suited to local needs for different
parts of India.
22) India though does need to
engage stakeholders and innovators in governance in policy, on one platform
Narendra Modi should make the
radical decision that the new institution will not be headquartered in Delhi
while imbuing with fresh blood and younger thinking. He should also ensure it
has a federal organizational structure so that a solution design is
decentralised while learning and sharing of best practices happens without any
barriers.
Lastly, this new institution
should aspire to take a long-term view of India’s challenges and think out of
the box to bring innovation and best practices from across India and across the
globe while adapting them to Indian conditions.
Sources: The Hindu, Niti Central, the Citizen, Indian Express, Times
of India.
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