An extra-constitutional, non-statutory body set up by a Union Cabinet resolution in March 1950 to formulate India's Five-Year Plans and allocate plan resources; it was replaced by NITI Aayog on 1 January 2015.
The idea of economic planning in India predates independence. The Indian National Congress set up a National Planning Committee in 1938 under Jawaharlal Nehru, industrialists published the Bombay Plan in 1944, and there were Gandhian and People's Plans as well. After independence, the Directive Principles in the Constitution called on the state to secure a just social order, and planning was seen as the main instrument for rapid industrialisation, reduction of poverty and self-reliance.
The Planning Commission was set up in March 1950 with Nehru as chairperson. The First Plan (1951–56) focused on agriculture and irrigation; the Second (1956–61), based on the Mahalanobis model, emphasised heavy industry and the public sector. Plan holidays followed crises in the 1960s, and the Commission's role changed after the 1991 reforms towards "indicative planning" that guided rather than commanded investment. By the 2010s, its scheme-driven transfers to states and overlap with the Finance Commission drew criticism, and it was dissolved in 2014, with NITI Aayog taking over from January 2015.
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