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P LANNING P ARADIGM
nomic growth rate. According to a
source, by 2008, India had established
itself as the world's second-fastest
growing major economy. However, the
year 2009 saw a signifi cant slowdown in
India's Gross Domestic Product (GDP)
growth rate to 6.8% which was largely
because of world economic slowdown.
Planning Commission where the ma-
jority of experts are economists, since its
inception has undergone sea changes. It
has present-continuous aim and humble
functions, broadly, to assessment of resources
of the country; formulation of
fi ve-year plans for effective use of these
resources; determination of priorities,
and allocation of resources for the Plans;
determination of requisite machinery for
successful implementation of the Plans;
periodical appraisal of the progress of the
Plan; to formulate plans for the most effective
and balanced utilization of country's
resources, to name a few.
Proximate Cause to Nosedive and
Characteristic Shifts
The low productivity in India is a result
of many instances, viz. agricultural subsidies,
overregulation of agriculture, inadequate
infrastructure and services and
lastly but not the least, over-enthusiasm
of politics sans polity.
The above blackheads in functioning
of the Planning Commission are because,
in practice, it takes a forced backseat
while welcoming always politics minus
welfare-state policy. More so, the government’s
thirst for intervention in all
spheres of economic and social activity
has far exceeded its ability to achieve
positive outcomes in any of them. The
government sought to eat more than it
could swallow. It is often felt that there
has been a large gap between the theory
70 THE IIPM THINK TANK
of Government intervention and the
practice of governance in India. The experts
put it “theoretical accountability of
politicians to voters is often thwarted in
practice by sharing misappropriated
public resources with special interest
groups whose vote is critical to re-election”.
All interventions are justifi ed by
the ministers and bureaucrats as in the
public interest or in the name of the Aam
Aadmi or both. The long-term natural
victim is Planning Commission.
Lesson From the Past
As the economists put it, a prima facie
lesson of Indian experience is that government
monopoly is, in a low income
democracy, more inimical to effi ciency
and growth than a private monopoly because
regulatory capture is much easier
in the former. This is because either
policy, regulation and ownership functions
are vested in the same government
department (monolith) or regulation and
ownership functions are overseen/ controlled
by the same department. In contrast,
in the case of private monopoly,
regulatory capture can be impeded by
two layers of accountability; First an independent
professional regulator and
then the government department (to appoint
& over see the regulator). So, deregulation/decontrol
is often cried for in
a right perspective.