Indian Economy
🔒 Log in to trackFive Year Plans and NITI Aayog
🔒 Log in to trackFive Year Plans (1951-2017)
| Plan | Period | Highlight / model |
|---|---|---|
| 1st | 1951-56 | Agriculture priority; based on Harrod-Domar model |
| 2nd | 1956-61 | Mahalanobis model — heavy industries |
| 3rd | 1961-66 | Self-reliance; wars and drought derailed it |
| Plan Holiday | 1966-69 | Three Annual Plans (after 1962/1965 wars) |
| 4th | 1969-74 | "Growth with stability"; 14 banks nationalised (1969) |
| 5th | 1974-79 | Garibi Hatao; terminated early |
| Rolling Plan | 1978-80 | Janata government concept (D.T. Lakdawala) |
| 6th | 1980-85 | Poverty removal focus; IRDP/NREP start |
| 7th | 1985-90 | Food, work, productivity |
| Annual Plans | 1990-92 | Transition years |
| 8th | 1992-97 | Ran against LPG reforms (1991 crisis) |
| 9th | 1997-2002 | "Growth with social justice" |
| 10th | 2002-07 | 8% target |
| 11th | 2007-12 | "Faster and more inclusive growth" |
| 12th (last) | 2012-17 | "Faster, more inclusive, sustainable growth" |
NITI Aayog (since 1 January 2015)
Replaced the Planning Commission (set up 1950, Nehru). Created by a Cabinet resolution — neither constitutional nor statutory. PM chairs it; Governing Council of CMs/LG administrators; Vice-Chair A.K. Lahiri (since May 2026); CEO Anurag Jain (since Aug 2026). Works through a 15-year Vision, 7-year Strategy and 3-year Action Agenda; runs indices like the SDG India Index, Composite Water Management Index and Aspirational Districts Programme.
Detailed notes
From plans to NITI
India adopted planning after independence; the Planning Commission was set up on 15 March 1950 by a Cabinet resolution (not a statute) with the Prime Minister as chairman. It steered twelve Five Year Plans from 1951 to 2017. From 1 January 2015 a Cabinet resolution replaced it with NITI Aayog (National Institution for Transforming India) — a think tank, not a fund-allocating plan body.
The plan ladder — who believed in what
| Plan | Period | Signature idea |
|---|---|---|
| 1st | 1951-56 | Harrod-Domar model; agriculture and irrigation priority |
| 2nd | 1956-61 | P.C. Mahalanobis model; heavy industry and capital goods |
| 3rd | 1961-66 | 'Gadgil strategy'; self-reliance; broken by wars and drought |
| Plan Holiday | 1966-69 | Three annual plans after the 3rd failed |
| 4th | 1969-74 | 'Growth with stability'; family planning pushed |
| 5th | 1974-78 | Poverty removal ('Garibi Hatao'); terminated early |
| Rolling plan | 1978-80 | The rolling plan concept (D.T. Lakdawala) |
| 6th | 1980-85 | Poverty eradication first; IRDP, NREP begin |
| 7th | 1985-90 | Food, work, productivity; Jawahar Rozgar Yojana (1989) |
| Annual plans | 1990-92 | Transition years, economic crisis |
| 8th | 1992-97 | Launched alongside the 1991 reforms (LPG) |
| 9th | 1997-2002 | 'Growth with social justice and equality' |
| 10th | 2002-07 | 8% growth target; monitoring |
| 11th | 2007-12 | 'Faster and more inclusive growth' |
| 12th | 2012-17 | 'Faster, more inclusive and sustainable growth' — the last plan |
Memory hooks: 2nd plan = Mahalanobis = machines; 8th plan began with liberalisation; 11th = inclusive; 12th = sustainable; the words 'plan holiday' and 'rolling plan' belong to 1966-69 and 1978-80 respectively.
NITI Aayog — structure and work
The Prime Minister chairs NITI Aayog. Its Governing Council brings together all Chief Ministers and Lt Governors of UTs; a Vice-Chairperson and full-time members are appointed by the PM; a CEO runs day-to-day work. Its design philosophy is cooperative federalism (states as partners) and competitive federalism (states ranked and nudged). Instead of plans it produces planning documents: a 15-year vision, a 7-year strategy and a 3-year action agenda. Its visible products are the indices and programmes exams quote: the SDG India Index, the Multidimensional Poverty Index (MPI) for states, the Aspirational Districts Programme (2018, 112 districts), the Composite Water Management Index, and school/health innovation reports. Contrast lines asked in exams: Planning Commission allocated plan funds and made five-year plans; NITI Aayog is advisory, does not allocate funds, and works through indices, evidence and monitoring.
Why this subtopic scores
Questions stay at the level of models, years, themes and NITI structure — all stable facts. Learn one phrase per plan, the two annual-plan interludes, and the three NITI documents, and you can crack any match-the-column on this page.
Quick revision
- Planning Commission: 15 March 1950, Cabinet resolution, PM as chairman; 12 plans, 1951-2017.
- 1st = Harrod-Domar/agriculture; 2nd = Mahalanobis/heavy industry; Plan Holiday 1966-69; Rolling plan 1978-80.
- 8th = LPG reforms era; 11th = inclusive growth; 12th (2012-17) = last plan, 'sustainable'.
- NITI Aayog: 1 Jan 2015, Cabinet resolution; PM chairs; Governing Council = CMs + LGs; CEO + Vice-Chairperson.
- Documents: 15-year vision, 7-year strategy, 3-year action agenda; no fund allocation.
- Flagship indices: SDG India Index, state MPI, Aspirational Districts (2018).
Types of questions asked
Every way this subtopic shows up in exams — how to recognise it, the formula or logic to use, and a solved example.
Type 1: Plan ↔ model matchingvery common3 practice Q
'The Second Five Year Plan was based on', 'the Harrod-Domar model belongs to which plan', matching thinkers and plans.
- Two pairs carry all the marks: 1st plan — Harrod-Domar (agriculture focus) and 2nd plan — P.C. Mahalanobis (heavy industry).
- The 3rd plan's strategy is attributed to D.R. Gadgil.
- If the question names 'heavy industry' or 'capital goods', the answer is the Mahalanobis model of the 2nd plan (1956-61).
Example: The Mahalanobis model, emphasising heavy industry, was the basis of which plan?
The Second Five Year Plan (1956-61) — it pushed capital-goods and machine-building industries behind public-sector investment.
Type 2: Plan ↔ years ↔ themevery common3 practice Q
'Growth with stability was the theme of', 'which plan coincided with the 1991 reforms', ordering of plans or spotting the last plan.
- Theme hooks: 4th = growth with stability; 9th = growth with social justice; 11th = inclusive growth; 12th = faster, inclusive and sustainable — the last plan (2012-17).
- The 8th plan (1992-97) opened in the liberalisation era; its start was delayed by two annual plans (1990-92).
- Interludes: Plan Holiday 1966-69 (after the 3rd); Rolling Plan 1978-80.
Example: 'Growth with stability' was the stated objective of which Five Year Plan?
The Fourth Plan (1969-74) — it sought growth while controlling the inflation that followed the wars and droughts of the 1960s.
Type 3: NITI Aayog structure and documentscommon3 practice Q
'Who chairs NITI Aayog', 'the Governing Council consists of', 'the 15-year vision / 7-year strategy / 3-year action agenda', statements on NITI's powers.
- Chairs: the Prime Minister; day-to-day work by a CEO; think-tank headship by a Vice-Chairperson.
- Governing Council = all Chief Ministers + Lt Governors of UTs — the federalism showcase.
- Documents: 15-year vision, 7-year strategy, 3-year action agenda; NITI does not allocate plan funds.
Example: The Governing Council of NITI Aayog includes —
The Prime Minister (chair), the Chief Ministers of all states and the Lt Governors of Union Territories — making it the main centre-state planning forum.
Type 4: Planning Commission vs NITI Aayogcommon2 practice Q
Statement pairs: fund allocation, statutory vs executive origin, plan body vs think tank, year of replacement.
- Both were created by Cabinet resolution — neither is statutory or constitutional.
- Planning Commission (15 March 1950) allocated funds and made plans; NITI Aayog (1 January 2015) advises, monitors and builds indices.
- The Finance Commission — a constitutional body — is the body people confuse with both; it handles tax devolution, not planning.
Example: Which statement about NITI Aayog is correct?
It was set up on 1 January 2015 by a Cabinet resolution, replacing the Planning Commission as an advisory think tank — it neither allocates plan funds nor enjoys statutory status.
Type 5: Plan Holiday, rolling plan and annual plansoccasional2 practice Q
'The Plan Holiday occurred during', 'the rolling plan concept is associated with', which plans were cut short.
- Plan Holiday: 1966-69 — three annual plans after the 3rd plan collapsed under war and drought.
- Rolling plan: 1978-80 (concept credited to D.T. Lakdawala) — plans revised every year with a moving horizon.
- Annual plans also ran in 1990-92 before the delayed 8th plan; the 5th plan (1974-78) was terminated a year early by the Janata government.
Example: The 'Plan Holiday' in Indian planning refers to —
The years 1966-69, when three annual plans replaced the usual five-year plan after the third plan was derailed by wars and drought.
Shortcut tricks
⚡ Plan-era story line
1-farm (1951) → 2-machines (Mahalanobis) → 3-wars → holiday (66-69) → 4-stability + bank nationalisation → 5-Garibi Hatao → rolling (Janata) → 6-7 growth → 8-reforms (1992) → 9-12 inclusive → NITI (2015).
Example: Which plan coincided with the LPG reforms?
The 8th Plan (1992-97).
⚡ Plan-break tags
Two gaps: Plan Holiday 1966-69 (wars/drought) and Annual Plans 1990-92 (transition after the 8th was delayed).
Example: Why was there a 'Plan Holiday'?
1962 and 1965 wars plus drought deranged the 3rd Plan; 1966-69 ran as annual plans.
Where students lose marks
Saying NITI Aayog is statutory — it is a Cabinet-resolution body.
Crediting the 2nd Plan to Harrod-Domar — the 1st Plan's framework was Harrod-Domar; Mahalanobis belongs to the 2nd.
Assuming the 12th Plan ended early — it ran full term to 2017; NITI then took over.
Practice sets — 15 questions
Sets of 10, mixed across the question types above. Each answer comes with a step-by-step explanation.
Topic test · 10 questions
Suggested time 4 min · wrong answers go to your mistake notebook automatically.