Five Year Plans were systematic economic development programs that guided India's economy from 1951 to 2017. These plans set specific targets for sectors like agriculture, industry, and infrastructure over five-year periods. The Planning Commission, established in 1950, was responsible for formulating these plans. In 2015, the government replaced the Planning Commission with NITI Aayog to create a more flexible approach to economic planning. The Planning Commission worked on a top-down approach. It would set targets from the center and states had to follow them. This system had limited flexibility and often failed to address local needs effectively. The commission focused heavily on government spending and public sector development.
India completed 12 Five Year Plans successfully. Each plan had specific themes - the First Plan focused on agriculture, the Second on heavy industries, and later plans balanced various sectors. The Tenth Plan introduced the concept of inclusive growth, while the Eleventh Plan emphasized faster and more inclusive growth. NITI Aayog represents a major shift in planning philosophy. It works as a policy think tank rather than a planning body. The full form is National Institution for Transforming India. It follows a bottom-up approach where states participate actively in policy making. The Prime Minister chairs NITI Aayog, and all Chief Ministers are its members.