Economic planning in India
Finally, on 15th August 1947, India got independence. We all got the freedom we were seeking from Britishers for more than 200 years. Now, the biggest challenge appeared in front of India to run its economy. After Independence, India adopted a socialist society with a strong public sector along with the private sector, which will help in the growth process of India. Economic planning in India started with the planning commission in 1950.
What is economic planning?
Economic planning in India is a process under which a central authority defines a set of targets to be achieved within a specified period.
Types of Economic system
Capitalism: It is an economic system in which major economic decisions includes
- What goods and services are to be produced.
- How goods and services are to be distributed are decided by the market.
Socialism: It is an economic system in which major economic decisions are taken by the government, keeping in view the collective interest of the society as a whole.
Mixed Economy: It is an economic system in which major economic decisions are taken by the Central Government authority, and some decisions are left for the market forces of demand and supply.
Goals of Five Year Plans
A plan should have some specified goals. The goals of the five-year plans are:
- Growth: Economic growth implies a consistent increase in GDP or a consistent increase in the level of output or a consistent increase in the flow of goods and services in the economy over a long period.
- Modernization: To increase the production of goods and services to producers with the adoption of new technology.
- Self-reliance: It means avoiding imports of those goods which could be produced in India itself. This policy was considered a necessity to reduce our dependence on Foreign countries, especially for food.
- Equity: It implies the equitable distribution of income so that the benefits of growth are shared by all sections of the society.
Read more about the economic planning in India.