[Mission 2024] STATIC QUIZ, 26 October 2023 – Economy

Solution: b)

Statement 1 is incorrect.

• Planning, in the real sense of the term, began with the Second Five Year Plan. The Second Plan, a landmark contribution to development planning in general, laid down the basic ideas regarding goals of Indian planning; this plan was based on the ideas of Mahalanobis. In that sense, he can be regarded as the architect of Indian planning.
• Industrial Policy Resolution 1956 (IPR 1956): In accordance with the goal of the state controlling the commanding heights of the economy, the Industrial Policy Resolution of 1956 was adopted. This resolution formed the basis of the Second Five Year Plan, the plan which tried to build the basis for a socialist pattern of society.

• In the first seven plans, trade was characterised by what is commonly called an inward-looking trade strategy. Technically, this strategy is called import substitution. This policy aimed at replacing or substituting imports with domestic production.

Solution: a)

Only Statement 2 is correct.

The First Five-year Plan was launched in 1951 which mainly focused in development of the primary sector. It was the second FYP that chose heavy industries as the Central plank of development planning.  

At the end of the plan period in 1956, five IITs were started as major technical institutions. The University Grants Commission (UGC) was set up to take care of funding and take measures to strengthen the higher education in the country.

The Bombay Plan is the name commonly given to a World War II-era set of proposals. It was published in 1944/1945.

Solution: b)

Statement 1 is incorrect.

In 1934, Sir M. Visvesvaraya had published a book titled “Planned Economy in India”, in which he presented a constructive draft of the development of India in next ten years. His core idea was to lay out a plan to shift labour from agriculture to industries and double up National income in ten years.

In the light of the basic principles of Gandhian economics, S. N. Agarwal authored ‘The Gandhian Plan’ in 1944 in which he put emphasis on the expansion of small unit pro­duction and agriculture. Its fundamental fea­ture was decentralisation of economic struc­ture with self-contained villages and cottage industries.

The Bombay Plan emphasizes the importance of basic industries, but also calls for the development of consumption goods industries in the early years of the plan.

Solution: b)

The Gadgil formula was evolved in 1969 for determining the allocation of central assistance for state plans in India. It was adopted for distribution of plan assistance during Fourth and Fifth Five Year Plans.

Solution: b)

Statement 1 is incorrect.

The people’s Plan:

In 1945, yet another plan was formulated by the radical humanist leader M.N. Roy, Chairman of the Post-War Reconstruction Committee of Indian Trade Union.

The plan was based on Marxist socialism and advocated the need of providing the people with the ‘basic necessities of life’. Agricultural and industrial sectors, both were equally highlighted by the plan.