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3rd, 4th, 5th, 6th, 7th, 8th and 9th FIVE-YEAR PLANS IN INDIA

OCTOBER 25, 2012

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3rd, 4th, 5th, 6th, 7th, 8th and 9th FIVE-YEAR PLANS IN INDIA


The 3rd FYP had the goal of a self-sufficient economy. The Plan showed clearly that agriculture was the mainstay of the economy and neglecting it would be dangerous for the economy. Hence, top priority was assigned to agriculture. Emphasis was also laid on basic industries. However, the Indo-China war in 1962 and the Indo-Pak war in 1965 shifted the focus from development to defence.

The target growth rate of GDP was 5.6% whereas the actual growth rate was only 2%.


The original draft of the 4th FYP in 1966 had to be abandoned after two years of drought, rupee devaluation and the stagflation. Instead three Annual Plans (1966-69), commonly called "Plan Holiday", were implemented. The fourth Plan (1969-74) had two principal goals namely "growth with stability" and "progressive self-reliance". The targeted rate of growth was 5.5% while the actual rate was 3.3%.



The 5th FYP was introduced when the economy was witnessing hyper-inflation due to hike in oil prices and the government failure to take over the wholesale wheat trade. The Plan set two goals i.e. removal of poverty (Garibi Hatao was the slogan given by Mrs. Indira Gandhi, the then Prime Minister) and attainment of self-reliance through better growth, better income distribution and higher domestic savings. The Fifth Plan was terminated by the newly elected Janata Government in March 1978. The targeted growth rate was 4.4% while the actual growth rate was 4.8%.


There were two Sixth Plans. The Janata 6th Plan (1978-83) focused on employment generation potential in agriculture and allied activities, encouragement to small scale industries producing mass consumer goods and better incomes for the lowest income groups through a Minimum Needs Programme.

The new 6th FYP ((1980-85) introduced by the Congress government rejected the Janata Plan and reintroduced the Nehruvian growth model by aiming at directly attacking poverty by creating an expanding economy. The targeted growth rate was 5.2% whereas the actual growth rate was 5.66%.



The 7th FYP was introduced in April 1985. During the earlier Plan, the country had enjoyed a reasonable growth in food grains production, employment opportunities and productivity. The Plan had a long-term objective of achieving self-sustaining growth by the year 2000. The targeted growth rate was 5%, while the actual growth rate was 6%.


During 1989-91, India witnessed political instability and so between 1990-1992, there were only Annual Plans. Finally, the 8th FYP (1992-'97) was finalized when the country faced a serious balance of payments crisis, rising debt, widening budget deficit, mounting inflation and industrial recession. The Narasimha Rao government initiated the process of fiscal reforms and economic reforms with a view to reviving a near bankrupt nation.


The Plan began privatization and liberalization in India. The major goals of the Plan were modernization of industry, control of population growth, poverty reduction, employment generation, strengthening of infrastructure, tourism management, human resource development etc. Energy was given priority with 26.6% of the total outlay. An annual average growth rate of 6.78% against the target of 5.6% was achieved.


The 9th FYP focused on "Growth with Social Justice and Equity". The Plan gave priority to agriculture and rural development to generate adequate employment and eradicate poverty. It also aimed to stabilize the prices to accelerate economic growth and to ensure food security. The targeted rate of growth was 7% per annum but the actual growth rate came out to be 5.35% only.


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