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Consequently, although planning implies an extension of the economic responsibilities and activities of the state , the mainspring of economic growth remains the private sector.

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Only rarely does the state intervene directly in the affairs of individual firms. Economic planning remains indirect and takes the form of collaboration between the public and the private sectors. Producers and consumers are free to adapt their activities to changes in market conditions and relative prices.

In the s there was a general trend for governments to sell state-owned enterprises to the public and to reduce the extent of public regulation of particular sectors, such as air transport. Communist methods of planning after the mids entered a state of flux, and the highly centralized administrative type of planning inherited after World War II from the Soviet Union by all the newly established communist states underwent considerable modifications.

In Yugoslavia planners followed policies very different from those of the Soviet model, and differences also emerged in the practice of other eastern European countries. In the Soviet Union itself, a debate concerning the most appropriate means for implementing plans went on for some years, but, despite numerous efforts on the part of the government to reorganize the machinery of planning, the fundamental drawbacks of central economic planning were never overcome. By the early s the postcommunist governments of eastern Europe and of the states of the former Soviet Union had begun making a painful transition to the diversified economic structure typical of the economies of western Europe.

There was consequently no settled planning doctrine in the developing countries, and the approach of governments remained empirical. In practice, this meant that the state played a major role in setting up new industries and in modernizing agriculture, particularly in countries of recent independence. The state budget was a major source of savings, supplemented frequently by the local currency counterpart of foreign aid. But the absence of a highly qualified civil service placed limits upon the extent and efficacy of state action.

Thus, in urban areas, privately owned businesses continued to supply most local consumer goods. The larger family concept leads to division of family land into several divisions. These lands besides being small and unproductive fail to generate adequate surplus also. Measures to improve agricultural production and productivity have come to be termed as agrarian reforms. Broadly two sets of measures are adopted. They are linked intricately with land ownership, tenancy and distribution measures.

With reference to land reforms, it was necessary to have a land ownership pattern that is socially just and economically viable. The measures adopted for land reform were:. At the time of independence, three different types of land tenure system were prevailing in India — Zamindari, Mahalwari and Ryotwari. After independence the first important step that the government taken up was the abolition of intermediaries. The state Governments enacted legislations to take over the intermediary rights from zamindars. The abolition of intermediaries was effected by March and fully implemented in several states.

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It is said that about 30 million tenants benefited from the zamindari abolition. Tenancy reforms in India had been conferred the benefit of security of land tenure by preventing large-scale eviction of tenants. Resumption of land by the owner for personal cultivation only, assuring a prescribed minimum area of land to the tenants has been provided for in the legislations.

Payment of rent by the tenants to the landlord had now been regulated. Provisions have been made in the tenancy legislation for conferment of ownership rights to tenants. Land holdings were limited on a minimum as well as a maximum ceiling. The maximum limit has been fixed to do social justice. The minimum has been fixed to prevent uneconomic unit of cultivation. The ceiling on land has been enacted in most of the states in the post independence period.

Those possessing land beyond the maximum limit would have to surrender the surplus land to the state. People with uneconomic units, evicted tenants and landless workers are usually distributed these surplus lands. Through this ceiling of land the Government intends to minimize the concentration of economic power and wealth.

It would ensure fuller utilization of workforce in agriculture and shall also enhance the social status of the rural poor. In order to solve the problem of fragmented holdings, consolidation is one of the best measures. It means pooling together in one compact block all the plots of land of a farmer that are scattered all over the village.

Not only does the cultivator get a compact portion of land but the total land or unit also remains the same. This kind of operation not only makes agricultural production economic but also reduces the area of wasteland. By about It has led to more productivity and increase in the cultivable area by removal of boundaries. About fifteen states had passed laws on consolidation of land and this has led to the full utilization of agricultural land for cultivation.

The main problem of agriculture in India is the practice of subsistence farming. Economic farming is far beyond the imagination of the Indian cultivator. A remedy in this regard is cooperative farming. Its essence lies in the retention of the rights of the individual cultivator in his own land, at the same time carrying on the agricultural operations jointly.

The main features of this kind of method are the following:. Net profits are distributed amongst members but some of it is held back for building up reserves and resources. In return the state offers its assistance to such a society by advancing loans for purchase of seeds, supply of manures and other necessary implements for cultivation. This has solved the problems of uneconomic farming to a great extent. The initial plans did not provide any facility for improvement in farming techniques.

National Economic Planning: What Is Left?

Agricultural efficiency depends to a great extent on the input and method of cultivation practiced. The various branches of technological measures are:. Adequate supply of water is the primary necessity for good agriculture. Geographically India receives substantial rainfall but that is often uncertain in volume, time and place and is not enough to sustain a stable agricultural base.

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Artificial irrigation thus becomes a necessity to improve agricultural production. Irrigation being a key factor in agriculture helps to extend the net sown area in regions that receive scanty rainfall. It also promotes multi-cropping by making it possible to raise a second crop during dry seasons.

It increases the gross cropped area. The main sources of artificial irrigation are canals, wells and tanks. During the seventh plan rapid expansion in irrigation facilities is considered to be a key element in agricultural procedures. In order to increase agricultural productivity, fertilizers and manures played an important role. Previously animal dung, compost and bones and other organic manures were used to restore the nutrients of the soil. The land was also left fallow to rebuild its nutrients. In recent years the uses of chemical fertilizers have greatly added to agricultural productivity.


The consumption of fertilizers increased from 69, tonnes of nutrients in the first plan to 9. This varied use of improved fertilizers has increased the crop area and led to better productivity.

Top 4 Stages of Economic Planning

To increase consumption of fertilizer the sixth plan aimed at ensuring equitable and efficient fertilizer distribution and to see that its benefits are received by all sectors of the farming community. To ensure the fuller benefits of such manures adequate measures were taken to protect the crops from rodents and pests.

Plant protection measures were also an important component of increasing crop yield. A great amount of improvement can be brought about by the use of better seeds in agriculture. The yield from better seeds is larger and the crop too sells for a better price. To promote the use of better seeds the Government has set up the National Seeds Corporation. Download preview PDF.

The nature of economic planning

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