. Five Year Plans India followed the example of the USSR in planning for development through five year plans. The Planning Commission was set up in to formulate plans for developing the economy. Each Plan assessed the performance of the economy and the resources available for future development.
Targets were set in accordance with the priorities of the government. Resources were allocated to various sectors, like agriculture, industry, power, social sectors and technology, and a growth target was also set for the economy as a whole. One of the primary objectives of planning was to build a self- sufficient economy. The First Five Year Plan covered the period – .
Till now there have been twelve Five Year Plans in addition to three one year plans between and . The proposed outlays for a Plan take both private and public sector outlays into account. The total outlay proposed for the First Plan was ` crores. By the Eleventh Plan, it had crossed ` .
lakh crores, which is an indication of the extent to which the Indian economy had grown in less than sixty years. Between the Second and Sixth Plans, public sector accounted for to % of the total plan outlay. But since then, the share of the public sector gradually came down, and private sector began to dominate in total plan outlay. The First Plan ( – ) focused on developing agriculture, especially increasing agricultural production.
The allocation for Agriculture and Irrigation accounted for % of the total outlay. After this, the emphasis shifted to industry, and the share of agriculture in total outlay hovered between and %. the government began a programme of disinvestment of the loss-making and non- strategic units in . In spite of all the shortcomings, the strategy of industrialisation by concentrating on building up long-term industrial capacity through the establishment of heavy industries has been successful in making India into a modern, industrial economy.
(d) Liberalisation: Industrial Policy Statement Finally in the Indian government announced a shift in its industrial policy to remove controls and licences, moving to a