Planning Commission to NITI Aayog

The transition from Planning Commission (1950-2014) to NITI Aayog (2015-present) marks a fundamental shift in India's governance architecture. The Planning Commission allocated plan funds with financial powers; NITI Aayog is a policy think tank without allocation authority. The shift reflects the move from centralized planning to cooperative federalism, from Five-Year Plans to three-year action agendas, and from Gadgil Formula to Finance Commission devolution.[TOPIC CLASSIFICATION]

• Topic type: Economy - Planning and Governance
• PYQ frequency: Medium
• Exam stage: Prelims + Mains
• Primary GS paper: GS 3

[EXAMINER REASONING]

1. Trap: Attributing financial powers to NITI Aayog. NITI is advisory; the Finance Commission and Finance Ministry allocate funds. Many aspirants confuse NITI with the Planning Commission's allocation role.
2. Most confused: The Plan/Non-Plan distinction (abolished 2017). Plan expenditure was Planning Commission allocated; Non-Plan was maintenance. The merger simplified budgeting but removed the investment-maintenance tracking.
3. Key anchor: The three shifts: (1) Allocation to advisory, (2) Centralized to cooperative federalism (Governing Council of CMs), (3) Five-Year Plans to 15-year Vision + 7-year Strategy + 3-year Action Agenda.
4. Current affairs hook: NITI Aayog 9 years (2024): Aspirational Districts 2.0, SDG India Index 4.0, Composite Water Management Index. 15th FC (2021-26) replaced Plan grants with 41% tax devolution. The 'Plan holiday' lessons (1966-69, 1990-92).
5. Mains hinge: Evaluate: Did the Planning Commission build state capacity or create dependency? The NITI model's lack of financial teeth vs the Planning Commission's centralized control is the Mains tension.

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Core Concept

Planning Commission (1950-2014): Cabinet Resolution, PM Chair. Five-Year Plans (12, 1951-2017). Gadgil Formula (1969) for Plan assistance: 60% population, 25% per capita income, 10% performance, 5% special problems. Plan vs Non-Plan expenditure. Achievements: industrial base, Green Revolution, space, nuclear. Shortfalls: low growth, license raj, centralized.

NITI Aayog (2015-present): National Institution for Transforming India. Cabinet Resolution. Chair: PM, Vice Chair, CEO, members. Governing Council: all CMs + LGs. NO financial powers. Mandate: cooperative federalism, competitive federalism (indices), evidence-based policy, monitoring, think tank.

Key documents: 15-year Vision (2030), 7-year Strategy (2022-23 to 2028-29), 3-year Action Agenda (2017-20). Indices: Aspirational Districts (112), SDG India Index, Water Index, Health Index, Education Index, Export Index.

Transition: 2017 Plan/Non-Plan merger. 15th FC (2021-26) vertical devolution 41%, performance incentives. NITI's role: monitoring SDGs, Aspirational Districts, state rankings, policy advice.