PLANNING PROCESS: AN INTRODUCTION:

Economics Planning is the making of major economics decisions what and how much is to be produced and to whom it is to be allocated by the conscious decision of a determining authority on the basis of a comprehensive survey of economics system as a whole. Planning is a purposive adoption of resources of social ends. Economics Planning may be described as the conscious efforts of a central organization to influence, direct, and in some case, even control changes in principal economic variables (e.g. GDP, consumption, investment, saving etc.) of a certain country or region over the course of time in accordance with a pre-determined set of objectives.

PLANNING OBJECTIVES :
Chief objective of economic planning is full utilization of countrys natural resources. Every country is endowed with large number of natural proper use of the available resources is possible by the government through the mechanism of economic planning. Main objectives behind economic planning may be divided into: o Economics Objectives o Social Objectives o Political Objectives

PLANNING BY ECONOMICS OBJECTIVES: Each plan has the following economic

national income economic planning aims at developing different sectors of the economy like agriculture, industry etc. Simultaneously it seeks to reduce the growth rate of population so that per capita income is increased.Increase in per capita income leads to increase in investment, which will cause the production to increase. This will set in motion the spiral of rising nation income.
b) Reduction of Inequality in Income: Each welfare economy aims at reducing economic

disparities. Economic inequalities give rise to class struggle. As a result, an unjust

economic system comes into being. Economic growth with social justice is therefore an important objective of economic planning.
c) Reduction in Regional Inequalities: Regional imbalances are sought to be reduced

through economic planning. Special attention is paid to the development of backward and under-developed regions of the country. Specific facilities are provided for the development of industry and agriculture in these regions.
d) Price Stability: Another objective of planning is to bring about economic stability.

Attempts are made to prevent violent changes in prices and insulate the economy from inflation and deflation.
e) Economic Development: Main objective of economic planning in underdeveloped

economics is to achieve all round development of the economy by removing obstacles in the way of economic development. In order to break the vicious circle of poverty prevailing in these countries it becomes necessary to have balanced growth of the economy. Al sectors of the economy, viz, agriculture, industry, etc. are sought to be developed.
f) Full Employment: Another objective of economic planning is to augment the

opportunities of employment. Full utilization of manpower is a desirable and possible target of each country. Every plan seeks to provide employment to maximum number of people.
g) Full Utilization of Available Resources: Chief objective of economic planning is full

utilization of countrys natural resources. Every country is endowed with large number of natural proper use of the available resources is possible by the government through the mechanism of economic planning.
h) Self Sufficiency: Almost all countries of the world are inter dependent. But too much

dependence on the other countries can be detrimental. Hence, one of the objective of economic planning is to attain self-sufficiency in economic sector. To that end, increasing of production to meet the needs of the country is imperative. Economic planning also aims at achieving favourable balance of payments.

i) Reconstruction: Another significant objective of economic planning is to reconstruct the war

ravaged economy or an economy disrupted by natural calamities.

PLANNING BY SOCIAL OBJECTIVES: Many objectives of planning are therefore related

a) Social Security: In capitalist countries the feeling of social insecurity haunts poor people. They live under the perpetual fear of unemployment, accident, disease etc. The affluent class of the society exploits them. One of the main objectives of economic planning is to provide social security to the poor and exploited class of the society. To achieve this objective social insurance and social assistance programmes are introduced. b) Social Equality: Economic planning also aims at providing social equality to the people. Because of social equality every citizen enjoys equal opportunities for his or her development and progress. c) Establishment of Socialistic Pattern of Society: Economic planning seeks to establish socialistic pattern of society in the country. This society refers to a system based on equality wherein minimum needs of the people are fulfilled and there is no exploitation of man by man.

PLANNING BY POLITICAL OBJECTIVES:

of peace. It is now a common belief that poverty in any part of the world constitutes a major threat to the prosperity in other parts of the world. Developed countries are therefore offering large assistance to under developed countries to remove poverty, unemployment, backwardness etc
b) Defence: Another aim of economic planning is to strengthen the defence and freedom of

the country. Economic planning, development and defence are treated as supplementary to one another. Economic planning helps in making a country strong economically and self sufficient in matters of defence.

PROCESS OF PLANNING:

In order to make the Plan, the Planning Authority has to pass through several stages. The stages refer to process of planning. The process of planning has the following constituents: a) Formulation: First stage of economic planning is to formulate the plan. This function is performed by the Planning Commission in India. Planning Authority prepares the draft of the physical targets and financial resources. It is called draft of the plan. It should be comprehensive and detailed. In democratic countries, before preparing the draft, the planning authority prepare an Approach Paper to Plan in order to elicit public opinion. In India, Planning Commission published Approach to Seventh Plan. b) Adoption: The draft Plan is adopted by the Government of the country. After its adoption it becomes a legal document. The responsibility for its execution lies on the government. c) Execution or Implementation: After the adoption of the Plan, responsibility of its execution rests with different departments of the government. These departments implement the Plan with Cooperation of Planning Commission. Indeed, it is a difficult task calling for a competent, able and honest administration. Success of the Plan depends more on its execution than formulation. d) Supervision: Implementation of the Plan must be monitored properly to ensure whether the objectives are being materialized or not. Shortcomings of the Plan be accounted for. In India, the changes are made in the Plan.

Plans must enjoy full support of the public. When people Co-operate with the government in the execution of its policies, it becomes easier to implement the plans.