NITI Aayog - India’s Five Year Plans, Indian Economy | Indian Economy - B Com PDF Download

1.  Introduction to NITI Aayog in India:

NITI Aayog or National Institution for Transforming India Aayog is basically a policy think tank of Government of India and State Governments that replaces 65-year old Planning Commission. Union Government of India had announced formation of NITI Aayog on 1st January, 2015.

The NITI Aayog will have a governing council comprising all State Chief Ministers and Lt. Governors of Union Territories and will work towards fostering a ‘Co-operative federalism’ for providing a “national agenda” to the Centre and States.

The body is comprised of a CEO and a Vice Chairperson, to be appointed by the Prime Minister, in addition to some full-time members and two part-time members, while four Union Ministers would serve as ex-officio members. Besides, there would be specific regional councils, while experts and specialists from various fields would be called as special invitees nominated by the Prime Ministers.

NITI Aayog will serve as a “think tank” of the government as a “directional and policy dynamo” and would provide both to the governments at the centre and in the states with strategic and technical advice on key policy matters including economic issues of national and international importance.

Thus NITI Aayog will never plan, rather it will formulate policy. By following these policies, various Ministries of the Central Government will prepare developmental projects considering the need of long term development. NITI is in favour of cooperative federal structure where both the Centre and States jointly prepare developmental policies.

But NITI, at the same time, wants to promote healthy competition among the developing states.

Thus, the propulsive concept behind the new body would be “co-operative federalism” entailing that the states to have their say in framing plans and policies for development. The NITI Aayog has been envisaged as a kind of inclusive think-tank embracing the Centre and States to give strategic and technical advice on economic matters of national and global importance.

NITI Aayog will have regional councils to focus on developmental activities on specific areas and is patterned on the National Reforms Development Commission of China.

While the Planning Commission had the power to allocate funds to states for attaining regional development, the NITI Aayog will not have such powers. Rather, the task of allocating funds to states now being vested with the Finance Ministry’s Department of Expenditure.

Its primary job would be to undertake long term policy and design frameworks and take necessary initiatives for attaining faster development and finally to monitor these activities sincerely.

Thus, NITI Aayog will actively monitor and evaluate implementation of the Government programmes and initiatives. The Planning Ministry of present NDA Government is of the view that “with central plan expenditure of the order of Rs 5.75 lakh crore was being channelized per year for development, it was absolutely necessary that there is concurrent, comprehensive, credible and reliable evaluation”.

This step mainly focuses on strategies to spread awareness about and use of evaluation as a tool for enhancing result from policies and programmes of good governance. So it was time to consider developing a National Evaluation Policy that would provide direction to Monitoring and Evaluation (M & E) activities in the country, laying stress upon quality standards and sound ethical procedures and provide for appropriate institutional mechanisms.

NITI Aayog would therefore mean:

(a) A group of people with authority entrusted by the government to formulate/regulate policies concerning transforming India.

(b) It is a commission to assist government in both social and economic issues.

(c) It is an institute of think tank with experts in it.

(d) It is an body to actively monitor and evaluate implementation of government programmes and initiatives.

2. Formation of NITI Aayog:

The NITI Aayog comprises the following members and bodies:

1. Prime Minister of India as the chairperson.

2. Governing Council comprising the Chief Ministers of all States and Union Territories with legislatures and Lieutenant Governors of other Union Territories.

3. Regional Councils will be formed to address specific issues and contingencies impacting more than one state or a region. The aim of the Regional Councils is to amicably settle disputes between two or more states facing a common set of problems that usually delay the progress of developmental projects.

These councils will be formed for a specified tenure. The Regional Councils will be convened by the Prime Minister and will comprise of the Chief Ministers of States and Lt. Governors of Union Territories in the region for addressing specific issues. These Regional Councils will be chaired by the chairperson of the NITI Aayog or his nominee.

4. Experts, specialists and practitioners with relevant domain knowledge will be called as special invitees, to be nominated by the Prime Minister.

5. Full-time organizational framework (in addition to Prime Minister as the Chairperson) includes the following positions:

(i) Vice-Chairperson.

(ii) Members: Two (2) Full-time.

(iii) Part-time Members: Maximum of two from leading universities, research organizations and other relevant institutions in an ex-officio capacity. Part-time members will be on a rotational basis.

(iv) Ex-officio Members: Maximum of four members of the Union Council of Ministers to be nominated by the Prime Minister.

(v) Chief Executive Officer (CEO). To be appointed by the Prime Minister for a fixed tenure, in the rank of Secretary to the Government of India.

(vi) Special Invitees.

(vii) Secretariat as deemed necessary for its functioning.

Present Members of NITI Aayog:

Presently, following members are included in the NITI Aayog in different capacities:

1. Chairperson: Prime Minister Narendra Modi.

2. CEO: Amitabh Kant

3. Vice Chairperson: Rajiv Kumar

4. Ex-officio Members: Rajnath Singh, Arun Jaitley, Suresh Prabhu and Radha Mohan Singh.

5. Special Invitees: Nitin Gadkari, Smriti Zubin Irani and Thawar Chand Gehlot.

6. Full-time Members: Bibek Debroy and V.K. Saraswat.

7. Governing Council: All Chief Ministers and Lieutenant Governor of Union Territories.

3. Aims and Objectives of NITI Aayog:

The following are some of the important aims and objectives of NITI Aayog:

1. NITI Aayog sets its aims to provide a critical directional and strategic input into the development process of the country.

2. NITI Aayog aims to serve as a “think tank” of the government both at central and state levels with relevant strategic and technical advice on key policy matters including economic issues of national and international importance.

3. NITI Aayog now seeks to replace the centre-to-state one way flow of policy framed by the Planning Commission by an amicable settled policy framed by a genuine and continuing partnership of states.

4. The NITI Aayog will also seek to put an end to slow and tardy implementation of policy by fostering better Inter-Ministry co-ordination and better centre-state co-ordination. It will help evolve a shared vision of national development priorities, and foster co-operative federalism, in order to focus on the view that strong states make a strong nation.

5. The NITI Aayog has set it objectives to develop mechanisms to formulate credible plans to the village level and aggregate these progressively at higher levels of government. This Aayog will ensure special attention to the sections of society that may be at risk of not benefitting adequately from economic progress.

6. The NITI Aayog, will create a knowledge, innovation and entrepreneurial support system through a collaborative community of national and international experts, practitioners and partners. The Aayog will offer a platform for resolution of inter-sectoral and inter-departmental issues in order to accelerate the implementation of the development agenda.

7. The NITI Aayog will monitor and evaluate the implementation of programmes, and focus on technology upgradation and capacity building.

Undertaking the above activities, the NITI Aayog will aim to accomplish the following objectives and opportunities:

(i) An effective administration paradigm in which the Government is an “enabler” rather than a “provider of first and last resort”.

(ii) Attaining progress from “food security” to focus on a mix of agricultural production as well as attain actual returns that farmers get from their produce.

(iii) To ensure that India is an active player in the debates and deliberations on the global commons.

(iv) To ensure that the economically vibrant middle-class remains actively engaged, and its potential is fully utilized.

(v) Leverage India’s pool of entrepreneurial, scientific and intellectual human capital.

(vi) Incorporate the geo-economic and geo-political strength of the non-resident Indian Community.

(vii) Use urbanization as an opportunity to create a wholesome and secure habitat through the use of modern technology.

(viii) Use technology to reduce opacity and potential for misadventures in governance.

Moreover, the NITI Aayog aims to enable India to face complex challenges in a better way through the following measures:

(i) Leveraging of India’s demographic dividend and realization of the potential of youth, men and women through imparting education, skill development, elimination of gender bias and also by providing employment.

(ii) Elimination of poverty, and the enhance the chance for every Indian to live a life of dignity and self- respect.

(iii) Redressal of inequalities based on gender bias, caste and economic disparities.

(iv) To integrate villages institutionally into the development process of the country.

(v) To provide policy support to more than 50 million small business which are considered as a major source of employment generation.

(vi) To safeguard our environmental and ecological assets.

Thus the NITI Aayog will try to frame a proper development policy for the country and will also seek to put an end to slow and tardy implementation of policy, by fostering better inter-ministry coordination and improve Centre-State coordination. It will also evolve a shared vision of national development priorities, and foster co-operative federalism, recognizing the motto that strong states make a strong nations.

Critics of this new set up criticised it and some termed it as an old wine in a new bottle. However, some critics have also argued positively in its favour.

Arun Maira, former Planning Commission member, observed that “The idea to create an institution where states’ leaders will be part and parcel of the collective thinking with the Centre and the other stakeholders in formulating a vision for the development of the country is right one as compared with previous structure, where a handful of people formulated the vision and then presented it to the National Development Council (NDC). This was not entirely absorbed and adopted by the latter”.

However, it is too early to comment on the efficacy of the new institution related to planned development, something possible when it shifts gears and moves into operation seriously. However, the present move to decentralize planning and allowing inputs from states to guide it, appears to be a positive and effective steps.

Another positive side of these institutions is to establish a dynamic institutional mechanism where eminent individuals outside the government system could contribute towards policy making. Moreover, one of the major tasks of the NITI Aayog is to actively monitor and evaluate implementation of programmes and initiatives which is something new under the present setup.