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Encyclopedia > Planning Commission

The rise of Yojana Bhavan

A K Bhattacharya | September 07, 2004

One of Montek Singh Ahluwalia's favourite ideas when he was Planning Commission member in the Vajpayee government was that Yojana Bhavan should also have the powers to put policy proposals on sectoral and macro-economic issues before the Cabinet. His argument was that the Planning Commission had a battery of experts on key sectors of the economy, which the government hardly used because their proposals were invariably ignored by the administrative ministries.

What does the Planning Commission do?

So why not allow Yojana Bhavan to approach the Cabinet directly on policy changes, he would argue, particularly when forcing the economic ministries to seek the Planning Commission's views was next to impossible.

And if the administrative ministry had a different point of view from the Planning Commission's suggestions, the issues could be discussed threadbare inside or outside the Cabinet, he would suggest as a solution.

Ahluwalia left the Planning Commission before he could persuade the Vajpayee government to agree to his proposal, which was not without merit.

Three years later, Ahluwalia is back, this time as deputy chairman of the Planning Commission. And officials in Yojana Bhavan have already begun to sense increasing clout in policy-making. They no longer regard themselves as members of an irrelevant organisation.

True, the Planning Commission has not yet acquired the powers to send policy proposals directly to the Cabinet. But at least one circular issued by the Cabinet Secretariat recently has come close to that at least in spirit.

It has stipulated that all ministries must send all their proposals entailing an expenditure of more than Rs 50 crore (Rs 500 million) to the Cabinet only after they get the Planning Commission's concurrence.

Old timers point out that the Cabinet Secretariat's circular is not a new initiative, but a reiteration of an old system. It had originally been envisaged that all proposals that required the government to spend money must get the Planning Commission's endorsement.

But over the years, central ministries began sending proposals directly to the Cabinet. There have been occasions when the proposal sent to the Cabinet have reached the Planning Commission on the same day the Cabinet was scheduled to meet. The latest circular is expected to end such practices.

What has also helped enhance the Planning Commission's profile and clout in official circles is the manner in which Prime Minister Manmohan Singh has chosen its members.

Each member is a reputed expert in his or her discipline -- be it Kirit Parikh, Abhijit Sen, Anwar-ul Hoda or B N Yugandhar. The Planning Commission is no longer an institution for parking ruling party leaders who cannot be accommodated elsewhere.

The choice of Ahluwalia as deputy chairman was also a clear signal from the prime minister to everyone in the government about the Planning Commission's increasing importance and role in governance.

Today, Ahluwalia is not just advising the government on how the Tenth Plan is to be implemented. Along with Finance Minister P Chidambaram and Reserve Bank of India Governor Y V Reddy, he is a member of the team that advises the prime minister on key economic issues like managing inflation.

A week ago, the government put together a team of experts to monitor infrastructure projects and remove obstacles to their implementation. Again, it was Ahluwalia who headed the team.

This committee's brief is quite comprehensive and Ahluwalia today is entrusted with the critical responsibility of giving the country's infrastructure a badly-needed push.

In the mid-1980s, Rajiv Gandhi, who was then the prime minister, had brought in Manmohan Singh as deputy chairman of the Planning Commission.

The move was widely acclaimed and there was hope that the Planning Commission would become an important and effective think-tank for the government.

But a sharp comment from Gandhi, in which he suggested that the Planning Commission members were "a bunch of jokers," marked the beginning of the decline of Yojana Bhavan that continued till a few weeks ago.

There is no doubt that the Planning Commission is set to regain its lost glory. And given the close equation between Manmohan Singh and Ahluwalia and the manner in which the new team has been selected, no sharp comment from the prime minister on the competence of the Planning Commission members is expected.

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