Five Year Plans: Piecing India Back Together

The top priority of a newly independent India was to put the economy on track. British rule had drained India of its wealth, caused famines, and left the country among the poorest in the world.

India needed to build infrastructure, set up factories, improve productivity and create jobs. Three quarters of the population was engaged in agriculture, which had low productivity. To drive economic growth, a Planning Commission was set up on 15th March 1950.

Influenced by socialist ideas, the Planning Commission adopted the Five Year Plan model based on the Soviet model. It saw a big role for governments in setting economic agendas. These Five-Year Plans were centralised and integrated national economic programmes.

Since India was then dealing with the post-Partition refugee crisis, food shortages and rising inflation, the first Five Year Plan allocated 45% of its budget to irrigation, energy, agriculture and community development projects.

The government incorporated three major hydroelectric projects under this plan. These were the Bhakra Nangal Dam in Punjab, Hirakud Dam in Odisha and Nagarjuna Sagar Dam in Andhra Pradesh. Jawaharlal Nehru famously called large dams the ‘temples of modern India’.

India also worked with the World Health Organization to address children’s health and reduce infant mortality. The First Five Year Plan had set a target to achieve 2.1% GDP growth; India ended up achieving 3.6% growth.

Cover Image: Wikimedia Commons

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