Economic Planning-Plan Holiday (From 1966 – 1967 to 1968 – 1969)
Economic planning- Plan Holiday was developed due to the failure of the Third Five Year Plan. This period marked the establishment of annual plans of 1966-1967 and 1968-1969. In this study, we will know more about this topic.
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Plan Holiday of economic planning is also known as the Three Annual plan in which development plans and strategies were made on an annual basis. In these plans, vital priorities were given to the agriculture sector and industrial sector of India. Plan Holiday was developed due to the miserable failure of the Third Five Year Plan. In this plan three annual plans were made such as from 1966-1967, 1967-1968 and 1968-1969. These plans mainly focused on improving the economic fallout caused due to failure of the third plan. This post will be helpful to identify various factors related to Plan Holiday and will also highlight some specific reasons for the development of these annual plans.
Economic planning- Plan Holiday (1966-1967)
Developing an economic framework that allows the smooth functioning of a country’s economy is one of the major concerns of a nation that supports its development and flourishing. Effective planning of economic growth can be achieved with the utilisation of resources available to the government. Besides, proper utilisation of resources present to a nation can be drawn by fetching an effective plan for economic growth. An effective economic plan guides a nation and its leaders to make appropriate decisions for the significant economic growth of the country. The annual economic development plan of 1966-1967 was established after the failure of Gadgil Yojna or the Third Five Year Plan. This plan was claimed to be a contingency plan or situational plan that was developed to recover the economic downfall caused during the period of the third plan.
The aim of the third plan was to develop an economic growth rate of 5.6 percent which was not developed due to several reasons. Plan Holiday initially was established to meet the requirements of the nation to mitigate the negative impacts caused during the third plan. Drought caused due to poor monsoon continued to be a crucial part of this annual plan due to which its objectives were not completely achieved. However, during this period a Green Revolution was commenced in 1966 in order to ensure an increase in the production of food grains using HYV seeds (High Yielding Variety Seeds).
Economic Planning- Plan Holiday (1968-1969)
Plan Holiday of 1968-1969 was the third annual plan of these three contingency annual plans. These annual plans were executed from 1966-1969 with a budget of around 1600 crores. These plans not only focused on the agricultural development of the nation but also emphasised the development of a community. Moreover, this plan puts focus on the development of industries that produce chemicals, fertilisers to produce high quality seeds and also to improve the quality of irrigation. Unfavourable monsoon conditions were limited to the beginning of 1966 and eventually the weather conditions were improved that favoured the growth of agriculture. This played a vital role in the successful achievement of all the objectives of this development plan. The Favorable monsoon in 1968-1969 of Plan Holiday period can be considered to be one of the greatest reasons responsible for yielding economic growth objectives of these contingency annual plans.
What are the reasons to establish a Plan Holiday?
Plan Holiday in terms of the Indian Economy is referred to as a gap between two to five years. These plans are usually created at the time of government change or during uncertainties in order to develop locked economic objectives or priorities. Some of the major reasons responsible for the development of Plan Holiday are wars and conflicts between India, Pakistan and China which has increased the inflation rates in India. The Government Of India decided to formulate three annual plans naming the Plan Holiday before proposing the fourth plan considering the prevailing economic condition of the country. In order to improve exports, the Indian government has declared devaluation of Indian currency during this period. These annual plans were made on more realistic grounds and the scrutiny of these plans were modified to meet the objectives of Plan Holiday.
What was the role of Plan Holiday in the economic development of India?
Plan Holiday plays a vital role in developing the economy of India. This contingency plan has helped the country to achieve a growth rate that is politically acceptable in terms of the economy. Effective management of resources and economics improves the growth rate in India during this period. According to estimations, the annual growth rate of India touched the mark of 6.9 percent while the country failed to achieve 5.9 percent of growth during the third plan period. Moreover, the agricultural production rate that decreased from 82 million tons to 72 million tons during the Third Five Year Plan also touched the mark of 95 million tons per annum in the 1968-1969 period of Plan Holiday. These improvements have significantly helped the country to develop a profitable economic condition that favoured the establishment of the Fourth Five Year Plan in India.
Conclusion
The study concludes that Plan Holiday was established to amend the economic gaps created during the Third Five Year Plan. The situational plans achieved their objectives of agricultural and industrial developments significantly along with the growth of community and social sectors. From the findings of this analysis, it can be stated that this plan has a significant role in the economic development of India.