NITI Ayog

May 05, 2017

NITI Ayog

Introduction:

The National Institution for Transforming India (NITI) Aayog was established on 01 January 2015 and replaced the Planning Commission of India, which was abolished after 65 years of its functioning. Prime Minister Narendra Modi chaired a crucial meeting of NITI Aayog’s Governing Council on 23 April 2017. The meeting was attended by chief ministers of all the states, whom the PM addressed as ‘The Team India’. The vice-chairman of NITI Aayog, Arvind Panagariya presented the 15-year Vision Document, comprising the seven-year strategy document and the three-year action plan (2017-18 to 2019-20). In order to give stability to the funding estimates of both the Centre and states, the three-year action plan will be aligned with the 14th Finance Commission award period. Since its establishment, there have been two earlier meetings of the Governing Council of NITI Aayog, which were held on 08 February 2015 and 15 July 2015.

About Planning Commission

1. The history of the Planning Commission goes back to Meghanand Saha in 1938. He pursued his friend, the then congress President Subhash Chandra Bose, who encouraged the establishment of the National Planning Committee with Jawaharlal Nehru as its first chairman.

2. Upon Independence, the Planning Commission was set up by a resolution of the Government of India in 1950 with the ruling PM as the ex-officio chairman.

3. Deputy Chairman was mostly an economic expert or politician who enjoyed the rank of cabinet minister.

4. Centralized planning was the goal of the Planning Commission. It was a Socialist Era institution based on the Russian model of five-year plan. The main function of Planning Commission was to formulate and review five-year plans, and review and monitor their progress.

5. Fixing target for sectoral growth and allocate resources to state were important functions of the Planning Commission

Reasons why Planning commission became obsolete

1. The year 1991 changed the economic policy of India completely. India adopted the LPG (Liberalization, Privatization, Globalization) policy. As the view of the government changed, the role of planning also changed. It became indicative of the planning in a world of free market institutions.

2. Allocation of scarce resources was the biggest problem before the Planning Commission as different states have more knowledge about their local requirements. Allocation of resources by the central government and dictating terms to the states was not liked by them.

3. The Planning Commission suffered from accusations of discrimination if different parties were governing at the state and central levels.

4. The role of private sector has become crucial in increasing the growth rate as it can provide new knowledge and technology to develop the infrastructure.

5. Most of the 5 year plans failed to achieve their target, thereby raising questions against the Planning Commission.

Salient Features of the NITI Aayog:

NITI Aayog or the National Institution for Transforming India is an institution of the Government of India, which is responsible for formulating economic policy recommendations for the central, state and union territory governments of India. NITI Aayog serves as a ‘Think Tank’ of the Government and provides Centre and states with relevant strategic and technical advice across the spectrum of key elements of policy. The states have the liberty to tailor their plans to suit their needs under more than 40 centrally sponsored schemes. Hence, unlike the erstwhile Planning Commission, the NITI Aayog has adopted a ‘Bottom Up’ approach, where decisions are being taken at the local level and then endorsed at the Central level.

Organisational Structure:

Chairperson: Prime Minister Narendra Modi
Vice Chairman: Arvind Panagariya
Governing Council: CM's (States) & Lieutenant Governors (Union Territories).
Regional Councils: Formed on need-basis, incorporates CM's & Lt Governors of the region.
CEO: Appointed by PM for fixed tenure. Presently, it is Mr Amitabh Kant
Secretariat: Appointed by nomination.
Part-Time Members: Max 2, Rotational, from relevant institutions.
Ex-officio Members: Max 4 from council of ministers, nominated by PM.

Objectives:

Foster cooperative federalism through structured support initiatives and mechanisms with the states on a continuous basis, recognizing that strong states make a strong nation.
Develop mechanisms to formulate credible plans at the village level and aggregate these progressively at higher levels of government.
Pay special attention to the sections of our society that may be at risk of not benefitting adequately from economic progress.
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.
Provide advice and encourage partnerships between key stakeholders and national and international like-minded Think Tanks, as well as educational and policy research institutions.
Create a knowledge, innovation and entrepreneurial support system through a collaborative community of national and international experts, practitioners and other partners.
Offer a platform for resolution of inter-sectoral and inter-departmental issues in order to accelerate the implementation of the development agenda.
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.
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.
Focus on technology upgradation and capacity building for implementation of programmes and initiatives.
Undertake other activities as may be necessary in order to further the execution of the national development agenda, and the objectives mentioned above.

Highlights of NITI Aayog Governing Council’s Meet:

23 April 2017: NITI Aayog Vice Chairman Arvind Panagariya presented a draft of the ‘Three Year Action Agenda’ for the nation's development. The draft includes 300 specific action points that have been identified in consultation with the states and these action points cover all the important sectors. The Vice Chairman further informed the Governing Council that besides the ‘Action Agenda’, a ‘Seven Year Strategy’ and a ‘15-year Long Term Vision’ will replace the erstwhile Five-Year Plans for the nation's planning framework. Incidentally, the 12th Five-Year Plan ended on 31 March 2017. NITI Aayog CEO Amitabh Kant outlined the initiatives taken so far in areas like agriculture, poverty elimination, health, education, digital payments, disinvestment, coastal zone, and island development. He highlighted that the NITI Aayog is working very closely with the states to improve basic services and infrastructure, especially in districts and regions which require specific attention. Union Revenue Secretary Hasmukh Adhia made a presentation on the GST, explaining the benefits of the indirect tax collection system and the way forward. He also urged the Chief Ministers of states to expedite the legislation of State GST Bills. Madhya Pradesh Chief Minister Shivraj Singh Chouhan, who has said to have ‘revolutionised’ agriculture in his state, made a presentation on doubling farmers' income by focusing on irrigation, technology generation and dissemination, and policy and market reforms.

PM Modi during his address highlighted the following points:

Advised states to use Govt. e-Marketplace to reduce corruption, increase transparency in govt. procurement.
Asked the states to put in place, without any delay the legislative arrangements at state-level for GST to meet the July 01 deadline for country wide implementation of GST.
Reminded the states that with liberal use of technologies such as BHIM, Aadhaar, etc, significant savings for the states will accrue.
PM asked NITI Aayog to prepare roadmap for better utilisation of funds available with the states to enhance forest and tree cover and conservation and management of wildlife through mineral and Compensatory Afforestation Fund Management and Planning Authority (CAMPA).
PM asked states to speed up capital expenditure and put in dedicated efforts for infrastructure creation.
PM said that through NITI Aayog, the views of chief ministers on key matters such as Centrally Sponsored Schemes, Swachh Bharat, Skill Development and Digital Payments will be taken on board.