INDIA’S FIRST FIVE YEAR PLAN covered the period from April 1951 through March 1956; the Second Five Year Plan covers the period from April 1956 through March 1961. The main objectives of planning in India are, broadly, to double real national income in less than 20 years and to double the per capita income in 25 years.
During the First Plan period, national income was expected to rise by 11–12 per cent; the actual increase was over 18 per cent, despite a shortfall in Plan outlays. The success of the First Plan, under conditions of economic and financial stability, prompted more ambitious goals and a bolder approach in formulating the Second Plan. The main objectives of the Second Plan are an increase of 25 per cent in real national income over the five-year period 1956–57 to 1960–61; a large expansion of employment opportunities; rapid industrialization; and reduction of economic inequalities. The emphasis on the development of industry and transport is greater than in the First Plan. The main problem is to step up the rate of investment in the economy. The total cost of the Plan has increased considerably since the estimates were presented, mainly because of two factors: the original costs were underestimated and prices have generally risen, especially prices of imported capital goods. But while difficulties have arisen currently in financing the Plan, particularly in regard to foreign exchange, it is important to stress the progress achieved so far. The technical and administrative tasks have been faced competently, by and large; major projects in steel, irrigation, and power are developing; and there is an unmistakable determination on the part of the Indian authorities to maximize tax resources, limit deficit financing, and take all possible measures to maintain the core of the Plan.