Thursday, 28 August 2014

RIP, Planning Commission!

In his maiden address to the nation on Independence Day, the Prime Minister Narendra Modi announced that the Planning Commission would meet its end and will promptly be replaced by a policy research think-tank which will be constituted of eminent luminaries in their respective fields. The abolition of the Planning Commission, is a bold step by the government, as it is one of the most important signals which indicate changing priorities as the narrative structure shifts from left-of-centre to a centre-right perspective. The Planning Commission is largely seen as a Nehruvian socialist regime and hence, the end of the Commission is a symbolic gesture to highlight the generational change within the country's polity.

While the media-driven public opinion was certainly that the Planning Commission is an ultimate example for policy paralysis, the reality is different from what the narration says. It is important to clarify that the idea of the new government is not to deride or demolish the legacy left behind by India's first Prime Minister, Jawaharlal Nehru but to fast-track development work in the country and empower the states as our current Prime Minister has consistently emphasised on the need for fast-track growth and development. 

The Planning Commission was initially set up in 1950 by the first Prime Minister Jawaharlal Nehru to optimise the scarce resource allocation in a newly-independent India. One of the main ideas that the Commission was to draw meticulously done five year plans which are done diligently but rarely implemented. However, India's economic policy underwent a paradigm shift with the 1991 Economic Reforms as we changed from a socialist to a semi-capitalist economy welcoming globalisation, liberalisation and privatisation. The methodology shifted from centralised investment planning to a more directional planning. Thus, the motives with which the Planning Commission was established in March 1950 was becoming redundant as the people quickly adapted to the new changes. 

Throughout the election campaign, the Prime Minister has consistently talked of empowering states by making them equal partners in the growth process. The constant emphasis on the word "federal" represented a key motivation which makes one believe that the abolition of the Planning Commission will mean in restoring the dignity of states and will also simultaneously mean release from the iron grip of the Central Government. The empowerment of states will mean in facilitating economic development within the states. 
The past ten years saw the Planning Commission becoming more of an embarrassment rather than an asset thanks to toilets being constructed, the outrageous debate on poverty lines. The Planning Commission became a political tool which was used conveniently to harass state governments which were ruled by opposition parties and was also seen as a symbol to counter the rise of regional parties. Eventually, the abolition of the Planning Commission comes to a point where states can facilitate regional development through self-sufficiency and proper resource allocation. 

The mandate for the new policy research think-tank should be a holistic vision for the country which could facilitate growth and development on a sustained basis. A state's future is for its government to perform and develop or perish, which is the fundamental point of the incumbent Prime Minister's view on federalism in an era beyond the Planning Commission.  

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