The new body did not have powers to allot funds to the states and approve central schemes and the Prime Minister's decision would be final in such matters, PMK founder leader S Ramadoss in a statement here said.
With Modi pitching for private role in policy-making, there were chances that the new body could have a sizeable number of part-time or full-time members from the corporate sector, he said, adding such members were generally opposed to subsidy, which could affect education, health and agriculture sectors.
"Besides if all powers are rested with the Prime Minister, it will only pave way for authoritarian rule... Overall, it seems the Prime Minister has brought about such a change to achieve his twin objectives of greater corporate role in government administration and wresting all authority," he charged.
The new measure will affect Centre-state relations, he claimed. While it was a fact that the Planning Commission had to be 'reformed', there was no need to completely replace it with a new body, said Ramadoss, whose party has been critical of several decisions of NDA government such as those on language and the Sri Lankan Tamils issue.
The government should not "tread a dangerous path" as the proposed measure taken up in the name of reforms and "lacking any foresight" would cause more "damage" than any benefit,he said.
He demanded that the government withdraw NITI Aayog and revert to a revamped Planning Commission that did its job of addressing national development.
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