General Awareness Topic: Types of Planning's in Economic Planning in India
Economic Planning: [Meaning of Planning]
Economic Planning means the allocation of limited resources among different uses in such a way as to bring about the maximum welfare of the people. Economic Planning consists of two basic elements. One is the determination of objective and second is the provision of means for the achievements of the objectives. The detailed scheme is called Economic Plan. The planning may either be centralized or decentralized depending upon the national requirements and degree of involvement of different sectors. The centralized planning refers to complete central control over major parts of the economic activities. Some of the decisions are related to investments in different sectors of the economy, fixation of price structure, rate of wages and the amount of production of a particular commodity.
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Types of Planning:
1) Physical and Financial Planning:
( i ) Physical Planning pertains to the allocation of resources in terms of men, materials and machinery.
( ii )Financial Planning refers to the technique of planning in which resources are allocated in terms of outlay.
2) Sectoral Planning and Spatial Planning:
Sectoral Planning has bought into focus more and more the concept of area development, i.e.., development plans for each of the homogeneous units in which the country is demarcated.
Spatial Planing is helpful in geographic dispersal of the efforts and fruits of planning in a scientific manner.
3) Regional, National and International Planning:
( i )Regional Planning serves best the purpose of meeting regional aspirations, exploiting regional resources and capabilities and promoting the implementation of national plans.
( ii ) National Planning: Includes the whole of a country whose geographical area is determined politically.
( iii ) International Planning: refers to the planning of countries at the world level.
4) Centralised and Decentralised Planning:
( i ) Centralised Planning presumes complete central control over a major part of the economy.
( ii) Decentralised Planning is the kind of planning where decision making process is dispersed and the implementation of plans is carried through prices and incentives.
5) Structural and Functional Planning:
( i) Structural Planning involves changes in socio-economic institutes.
( ii ) Functional Planning involves no such changes in the socio-economic structure of the society but planning is done within the framework of existing institutions
6) Long-term, Medium-term and Short-term Planning:
( i ) Long-term Planning covers 10, 15, 20 and even more years. It clarifies the perspective and the vision of society.
( ii ) Medium-term Planning extends over 3 to 5 years up to 7 to 10 years. It concretes aspirations.
( iii ) Short-term Planning relates to as short a period as one year. It provides for action.
7) Fixed-term Plans and Rolling Plans:
( i ) Fixed-term Plans: Ordinarily a short-term Plan, say of five years, is divided into annual plans, each annual plan beginning from where the preceding plan left. This way it may be called fixed-term planning.
( ii) Rolling Plans: A variant of short-term plans is what has come to be know as "Rolling Plans" Two major aspects of Rolling Plans:
( I ) In a Rolling Plan, the central outlay allotment for major sectors within the overall five-year plan targets will be fixed on a yearly basis.
( II ) The five year horizon will be extended each year by changing the select central targets for an additional year.
8) Indicative and Imperative Planning:
( i ) Indicating Planning provides direction for the growth of the economy by spelling out clear goals and providing help in reaching them.
( ii ) Imperative Planning is essentially planning where in the implementation is provided for, along with its formulation. It not only plan what is desirable but ensures that the economy shapes itself as per plan requirements.
Important Links:
- Practice Paper Based on Indian Economy
- General Awareness about Committees in Our Parliament
- General Awareness about World Trade Organization for Competitive Exams
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