Large Or Small Plan?

The infrastructure constraints, the continuing problems with restraining the fiscal deficit and the likelihood of the run of good monsoons being interrupted are all strong reasons for staying within the realms of possibility.

The bigger question has to do with the planning exercise itself. Till the mid-1970s, the public sector component of the plan was more than half the total; now it is down to barely a third (because governments have little money to invest, and most investment therefore takes place in the private sector). Of the public sector's one-third, the Centre accounts for a little over half. In other words, the Centre controls less than a fifth of the plan investment figures that are worked out so laboriously. The rest of the proposed investment is outside the Centre's control, and amounts to little more than what is called indicative planning. The approach paper tries to deal with this by discussing what it calls "cooperative federalism": the state plans will not be scrutinised in quite the same way as in the past. And there is a third tier of government (panchayats) which has to be brought into the whole process. Exactly how remains vague. In many ways, the approach paper suggests that the planning process has to change quite radically, but it stops short of suggesting that it be dropped altogether. Perhaps that will be done once the reform process and privatisation drive proceed for another five years.

 

This suggests that the Planning Commission is now in search of a role. Individual commission members seem to be finding their own solutions (one might want to be re-designated member-offshore). The fact is that the commission could be of some use as a forum for addressing centre-state-panchayat issues, for giving new life and form to the federal spirit, in framing the issues that face the economy, working out the macro-economic numbers, and looking at institutional issues that need to be addressed. In short, Yojana Bhavan could seek to provide intellectual leadership in a society where developmental and economic issues will remain central concerns for some decades to come. But the very idea of the Planning Commission providing intellectual leadership seems laughable today, since its ambitions seem to be limited to skirmishing with the finance ministry in entirely unproductive ways.