On the 13th of August, 2014, the Modi Government scrapped the 65-year-old Planning Commission and announced that it would be replaced by a new body. Accordingly, on January 1, 2015, the NITI Aayog (National Institution for Transforming India) was established as the successor to the planning commission.
However, it must be noted here that the NITI Aayog, like that of the Planning Commission, was also created by an executive resolution1 of the Government of India (i.e., Union Cabinet). Hence, it is also neither a constitutional body nor a statutory body. In other words, it is a nonconstitutional or extra-constitutional body (i.e., not created by the Constitution) and a non-statutory body (not created by an Act of the Parliament).
NITI Aayog is the premier policy ‘Think Tank’ of the Government of India, providing both directional and policy inputs. While designing strategic and long-term policies and programmes for the Government of India, NITI Aayog also provides relevant technical advice to the Centre and States.
The centre-to-state one-way flow of policy, that was the hallmark of the Planning Commission era, is now sought to be replaced by a genuine and continuing partnership of states.
In a paradigmatic shift from the command and control approach of the past, NITI Aayog accommodates diverse points of view in a collaborative, rather than confrontationist, setting. In the spirit of federalism, NITI’s own policy thinking too is shaped by a ‘bottom-up’ approach rather than a ‘top- down’ model.
While explaining the reason for replacing the Planning Commission with the NITI Aayog, the Union Government made the following observation: “India has undergone a paradigm shift over the past six decades—politically, economically, socially, technologically as well as demographically. The role of Government in national development has seen a parallel evolution. Keeping with these changing times, the Government of India has decided to set up NITI Aayog (National Institution for Transforming India), in place of the erstwhile Planning Commission, as a means to better serve the needs and aspirations of the people of India.”
The new institution will be a catalyst to the developmental process; nurturing an overall enabling environment, through a holistic approach to development going beyond the limited sphere of the Public Sector and Government of India. This will be built on the foundations of:
1. An empowered role of States as equal partners in national development; operationalising the principle of Cooperative Federalism.
2. A knowledge hub of internal as well as external resources; serving as a repository of good governance best practices, and a Think Tank offering domain knowledge as well as strategic expertise to all levels of government.
3. A collaborative platform facilitating implementation; by monitoring progress, plugging gaps and bringing together the various ministries at the Centre and in States, in the joint pursuit of developmental goals.
In the same context, the Union Finance Minister Arun Jaitley said: “The 65-year-old Planning Commission had become a redundant organisation. It was relevant in a command economy structure, but not any longer. India is a diversified country and its states are in various phases of economic development along with their own strengths and weaknesses. In this context, a ‘one-size-fits-all’ approach to economic planning is obsolete. It cannot make India competitive in today’s global economy.”
The Resolution observed: “Perhaps most importantly, the institution must adhere to the tenet that while incorporating positive influences from the world, no single model can be transplanted from outside into the Indian scenario. We need to find our own strategy for growth. The new institution has to zero in on what will work in and for India. It will be a Bharatiya approach to development.”
The composition of the NITI Aayog is as follows:
(a) Chairperson: The Prime Minister of India
(b) Governing Council: It comprises the Chief Ministers of all the States, Chief Ministers of Union Territories with Legislatures (i.e., Delhi and Puducherry) and Lt. Governors of other Union Territories.
(c) Regional Councils: These are formed to address specific issues and contingencies impacting more than one state or a region. These are formed for a specified tenure. These are convened by the Prime Minister and comprises of the Chief Ministers of States and Lt. Governors of Union Territories in the region. These are chaired by the Chairperson of the NITI Aayog or his nominee.
(d) Special Invitees: Experts, specialists and practitioners with relevant domain knowledge as special invitees nominated by the Prime Minister.
(e) Full-time Organisational Framework: It comprises, in addition to the Prime Minister as the Chairperson:
(i) Vice-Chairperson: He is appointed by the Prime Minister. He enjoys the rank of a Cabinet Minister.
(ii) Members: Full-time. They enjoy the rank of a Minister of State.
(iii) Part-time Members: Maximum of 2, from leading universities, research organisations and other relevant institutions in an ex-officio capacity. Part-time members would be on a rotation.
(iv) Ex-Officio Members: Maximum of 4 members of the Union Council of Ministers to be nominated by the Prime Minister.
(v) Chief Executive Officer: He is appointed by the Prime Minister for a fixed tenure, in the rank of Secretary to the Government of India.
(vi) Secretariat: As deemed necessary.
NITI Aayog houses a number of specialised wings, including5:
1. Research Wing: It develops in-house sectoral expertise as a dedicated think tank of top notch domain experts, specialists and scholars.
2. Consultancy Wing: It provides a market-place of whetted panels of expertise and funding, for the Central and State Governments to tap into matching their requirements with solution providers, public and private, national and international. By playing match-maker instead of providing the entire service itself, NITI Aayog is able to focus its resources on priority matters, providing guidance and an overall quality check to the rest.
3. Team India Wing: It comprises of the representatives from every State and Ministry and serves as a permanent platform for national collaboration. Each representative:
(a) Ensures that every State/Ministry has a continuous voice and stake in the NITI Aayog.
(b) Establishes a direct communication channel between the State/Ministry and NITI Aayog for all development related matters, as the dedicated liaison interface.
NITI Aayog functions in close cooperation, consultation and coordination with the Ministries of the Central Government, and State Governments. While it makes recommendations to the Central and State Governments, the responsibility for taking and implementing decisions rests with them.
The objectives of the NITI Aayog are mentioned below:
1. To evolve a shared vision of national development priorities, sectors and strategies with the active involvement of States in the light of national objectives. The vision of the NITI Aayog will then provide a framework ‘national agenda’ for the Prime Minister and the Chief Ministers to provide impetus to.
2. To foster cooperative federalism through structured support initiatives and mechanisms with the States on a continuous basis, recognising that strong States make a strong nation.
3. To develop mechanisms to formulate credible plans at the village level and aggregate these progressively at higher levels of government.
4. To ensure, on areas that are specifically referred to it, that the interests of national security are incorporated in economic strategy and policy.
5. To pay special attention to the sections of our society that may be at risk of not benefitting adequately from economic progress.
6. To design strategic and long-term policy and programme frameworks and initiatives, and monitor their progress and their efficacy. The lessons learnt through monitoring and feedback will be used for making innovative improvements, including necessary mid-course corrections.
7. To provide advice and encourage partnerships between key stakeholders and national and international like-minded think tanks, as well as educational and policy research institutions.
8. To create a knowledge, innovation and entrepreneurial support system through a collaborative community of national and international experts, practitioners and other partners.
9. To offer a platform for resolution of inter-sectoral and inter-departmental issues in order to accelerate the implementation of the development agenda.
10. To maintain a state-of-the-art Resource Centre, be a repository of research on good governance and best practices in sustainable and equitable development as well as help their dissemination to stake-holders.
11. To actively monitor and evaluate the implementation of programmes and initiatives, including the identification of the needed resources so as to strengthen the probability of success and scope of delivery.
12. To focus on technology upgradation and capacity building for implementation of programmes and initiatives.
13. To undertake other activities as may be necessary in order to further the execution of the national development agenda, and the objectives mentioned above.
Through the above, the NITI Aayog aims to accomplish the following objectives and opportunities:
1. An administration paradigm in which the Government is an “enabler” rather than a “provider of first and last resort.”
2. Progress from “food security” to focus on a mix of agricultural production, as well as actual returns that farmers get from their produce.
3. Ensure that India is an active player in the debates and deliberations on the global commons.
4. Ensure that the economically vibrant middle-class remains engaged, and its potential is fully realised.
5. Leverage India’s pool of entrepreneurial, scientific and intellectual human capital.
6. Incorporate the significant geo-economic and geo-political strength of the Non-Resident Indian Community.
7. Use urbanisation as an opportunity to create a wholesome and secure habitat through the use of modern technology.
8. Use technology to reduce opacity and potential for misadventures in governance.
The NITI Aayog aims to enable India to better face complex challenges, through the following:7
1. Leveraging of India’s demographic dividend, and realisation of the potential of youth, men and women, through education, skill development, elimination of gender bias, and employment
2. Elimination of poverty, and the chance for every Indian to live a life of dignity and self-respect
3. Redressal of inequalities based on gender bias, caste and economic disparities
4. Integrate villages institutionally into the development process
5. Policy support to more than 50 million small businesses, which are a major source of employment creation
6. Safeguarding our environmental and ecological assets
In carrying out the above functions, the NITI Aayog is guided by the following principles8:
1. Antyodaya: Prioritise service and uplift of the poor, marginalised and downtrodden, as enunciated in Pandit Deendayal Upadhyay’s idea of ‘Antyodaya’.
2. Inclusion: Empower vulnerable and marginalised sections, redressing identity-based inequalities of all kinds—gender, region, religion, caste or class.
3. Village: Integrate our villages into the development process, to draw on the vitality and energy of the bedrock of our ethos, culture and sustenance.
4. Demographic dividend: Harness our greatest asset, the people of India; by focussing on their development, through education and skilling, and their empowerment, through productive livelihood opportunities.
5. People’s Participation: Transform the developmental process into a people-driven one, making an awakened and participative citizenry—the driver of good governance.
6. Governance: Nurture an open, transparent, accountable, pro-active and purposeful style of governance, transitioning focus from Outlay to Output to Outcome.
7. Sustainability: Maintain sustainability at the core of our planning and developmental process, building on our ancient tradition of respect for the environment.
Therefore, the NITI Aayog is based on the following seven pillars of
(i) Pro-people agenda that fulfils the aspirations of the society as well as individuals.
(ii) Pro-active in anticipating and responding to citizen needs.
(iii) Participative, by involvement of citizens.
(iv) Empowering women in all aspects.
(v) Inclusion of all groups with special attention to the SCs, STs, OBCs and minorities.
(vi) Equality of opportunity for the youth.
(vii) Transparency through the use of technology to make government visible and responsive.
Through its commitment to a cooperative federalism, promotion of citizen engagement, egalitarian access to opportunity, participative and adaptive governance and increasing use of technology, the NITI Aayog seeks to provide a critical directional and strategic input into the development process. This, along with being the incubator of ideas for development, is the core mission of NITI Aayog.
Hitting out at the government for its decision to restructure the Planning Commission and rechristen it as “NITI Aayog”, the Opposition said the move is just a “fluff” and mere “gimmickry”. They also expressed their apprehension that the new body will pave the way for discrimination, as “corporates will call the shots” in policy-making in the country.
CPI(M) leader Sitaram Yechury termed the renaming of the Planning Commission as aniti aur durniti (no policy and bad policy).
Mr. Yechury said, “just a change of nomenclature and gimmickry does not serve any purpose. Let us see what the government plans to do with it”.
“If the government wants to greet people with fluff and not substance on the first day of 2015, then there is nothing more that can be said... If the North Block or the Finance Ministry has a very short-term view of both fiscal and monetary objective and is going to be the final arbiter between the states and the Centre... it being the stakeholder in the process... I am afraid, is going to discriminate against the states,” Congress leader Manish Tewari said.
“After all, what was the Planning Commission doing? It used to plan policy. So by changing the nomenclature from Planning Commission to NITI Aayog what is the message this government is trying to send,” Mr. Tewari said, adding that Congress’ opposition to restructuring of the Planning Commission was based on “principles”.
“It’s not a question of fighting a war, it’s a matter of principle. The Opposition Bharatiya Janata Party used to go extra lengths talking about federalism and how the sanctity and sacrosanct of federalism has to be maintained. And now they are going exactly the reverse,” the Congress leader said.
Veteran CPI leader Gurudas Dasgupta said that dismantling of the Planning Commission and bringing in a new body in its place will lead to an unregulated economy. “It is not a change of name. The Planning Commission is being abolished because they (government) don’t believe in planning,” he said.
“The government would like to have a full-market economy (which is) totally unregulated,” Mr. Dasgupta said adding. “If this becomes the policy of the government to not help advance the country, control inflation and create job opportunities, it will not be good for the country”.
“Mere change of name from Yojana Aayog to NITI is not objectionable if it is coupled with real reform. Otherwise, it will be purely cosmetic like earlier naming ceremonies,” Congress spokesperson Abhishek Manu Singhvi said. He said the Congress would have supported constructive reform of the Planning Commission. But the “alteration of identity and basic structure”, he said, “is being done because of anti-Nehruvianism and anti-Congression.”
CPI(M) central committee member Md Selim, MP, said no meaningful purpose would be served by just renaming the Planning Commission. Alleging that the BJP government had decided to dissolve the planning commission “to dilute the planning process”, he said the government should have given more teeth to the National Development Council instead.
The National Institute of Labour Economics Research and Development (formerly Institute of Applied Manpower Research) is a subordinate office of the NITI Aayog.
The Institute of Applied Manpower Research (IAMR) was established in 1962 under the Societies Registration Act of 1860 as an institution that would function as a clearing-house of ideas and undertake policy research on human capital development to inform perspective planning and promote policy integration. The main object of the Institute is to advance knowledge about the nature, characteristics and utilisation of human resources through research, education and training, consultancy, etc.
IAMR has been renamed as National Institute of Labour Economics Research and Development (NILERD) on the 9th of June, 2014. NILERD is mainly funded by grants-in-aid from the NITI Aayog (formerly Planning Commission), and supplemented by its own revenue from contracted research projects, and education and training activities. The prime objective of NILERD has been to develop an institutional framework capable of sustaining and steering a systematic applied human resource planning research process.
Since its inception, the Institute has carved out its own trajectory to achieve academic heights, and in the process, developed a range of academic activities not only in the field of human resource planning and development, but also in monitoring and evaluation of public policies and programmes. During the past few years, the Institute has exhibited remarkable dynamism in addressing the issues of national priorities. The Institute has emerged as a pioneering institute in providing academic training on human resource planning and development for both international and national participants.
The Institute moved to its own campus at Narela in 2002. Narela is a developing urban and institutional hub declared as a special economic zone for knowledge in the National Capital Region.
ERSTWHILE PLANNING COMMISSION
The erstwhile Planning Commission was established in March 1950 by an executive resolution of the Government of India, (i.e., the Union Cabinet) on the recommendation of the Advisory Planning Board constituted in 1946, under the chairmanship of K.C. Neogi. Thus, the erstwhile Planning Commission was neither a constitutional body nor a statutory body. In India, it was the supreme organ of planning for social and economic development.