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Business News/ Politics / Policy/  Political divide on scrapping Planning Commission
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Political divide on scrapping Planning Commission

Arun Jaitley says most states agree on need to change system; Congress says panel should be reoriented, not buried

Prime Minister Narendra Modi pushed for an effective structure, which strengthens ‘co-operative federalism’ and the concept of ‘Team India’. Photo: BloombergPremium
Prime Minister Narendra Modi pushed for an effective structure, which strengthens ‘co-operative federalism’ and the concept of ‘Team India’. Photo: Bloomberg

New Delhi: Prime Minister Narendra Modi’s proposal to replace the Planning Commission with a new institution took a political turn on Sunday, after chief ministers of several non-Bharatiya Janata Party-ruled states told a meeting convened by Modi that they were strongly opposed to the idea, even though the centre promised states a greater say under a new setup.

Modi on Sunday met with chief ministers and representatives of nearly all the states in the National Capital as part of a consultation process following his Independence Day announcement that he intended to replace the Planning Commission with a new body to reflect changes in India’s economy—from a command-and-control economy to one that is globalized and market-led.

Addressing reporters after the meeting, finance minister Arun Jaitley said most states were in favour of a system that strengthens the ability to deliver, while Congress-ruled states were in favour of restructuring the present setup rather than replacing it.

“There was a larger consensus to the effect that the context has changed. There is a need to decentralize both power and planning. States have to be strengthened. Most CMs (chief ministers) felt that you cannot have a centrally conceived scheme and ask all CMs to implement it. The requirements of each states are different, and states know what suits them best. So, the strategy has to be to empower the states," he added.

Jaitley said most states favoured an alternative structure in which both the centre and states, plus experts, could participate and which should not be merely a central structure. “A few, while agreeing with the general principle of change, felt that the present Planning Commission could evolve into that structure," he added.

Meanwhile, taking strong exception to the centre’s move to dismantle the Planning Commission, the Congress party on Sunday said this will be an “unwarranted, short-sighted and dangerous" step as it will have a long-term effect on centre-state relations. The Plan panel needed “reorientation" and not “political burial", the opposition party said.

“Any move to rename or restructure is unwarranted in national interest and must be opposed. What the Planning Commission needs is reorientation and not renaming or a political burial," Congress party spokesperson Anand Sharma said.

Reflecting the view of their party, all Congress-ruled chief ministers opposed the move in their meeting with Modi.

Himachal Pradesh chief minister Virbhadra Singh said in a statement that the functioning of the Planning Commission in its present form should be strengthened by giving it additional functions in order to meet the challenges of the economy and the aspirations of the states. The body had played a pioneering role over the last six decades, having helped states formulate plans in a consultative manner, he said.

“The move to distribute the planning functions among the ministry of finance and respective ministries would result in loss of perspective and long-term view. The differences in approach between Planning Commission and ministry of finance were always useful in providing checks and balances, since the commission always considered states’ viewpoints in schemes and plans," he added.

Other Congress chief ministers including Tarun Gogoi of Assam and Oommen Chandy of Kerala also opposed the centre’s move to dismantle the body.

Also opposing the centre’s idea were some non-Congress, non-BJP ruled states including West Bengal and Bihar.

Bihar chief minister Jitan Ram Manjhi said the timing of the move to restructure the Planning Commission at this juncture was not appropriate as “we are in midst of the 12th Plan period and all of our developmental strategies are committed to this Five-Year Plan. Any substantial change now in our planning strategy will create confusion and disfunctionality in our developmental programmes and ongoing projects".

Manjhi said the appropriate forum to deliberate this issue would have been the National Development Council. “Furthermore, it would have been more fruitful and productive if the alternative structure and modalities that are being proposed could have been circulated beforehand to the states, so that they could have firmed up their views on the issue. The manner in which this meeting has been convened, its agenda and format, is pointing to the fact that you have already made up your mind on the subject and the states are here merely to put their stamp on it," he added.

West Bengal chief minister Mamata Banerjee, who did not personally attend the meeting, wrote to the Prime Minister saying that instead of setting up a new body through an executive order, the decision-making responsibilities of the Planning Commission should be assigned to the Inter-State Council. “The council is a constitutional entity under Article 263 of the Constitution. It has a secretariat which will require suitable strengthening. In the same vein, the National Development Council should also be subsumed within the new dispensation," she added.

However, Biju Janata Dal-ruled Odisha chief minister Naveen Patnaik supported the centre, highlighting how inequitable distribution of resources in the past had caused imbalances in the development of states. “The neglect of Railways in Odisha is a classic example in this regard. I urged that states should be allowed the freedom to prepare their plan based on local felt need," he added.

To drive the point home to the Congress-ruled states, Modi cited his Congress party predecessor Manmohan Singh who before relinquishing office had advocated in April the need for “reinventing or rediscovering" the Planning Commission in the changed environment.

Citing the spirit of “cooperative federalism", Modi told the meeting that the Planning Commission should be replaced by a suitable body, “so that the strengths of the country can be suitably harnessed", a statement from the Prime Minister’s office said.

Asked about the fate of the Five-Year Plan, Jaitley said: “When finally the government takes a decision, the issue that you have raised will also be addressed. This was raised by the secretary, Planning Commission, in her presentation. The government will take a view on that."

Jaitley, however, said the government has not decided on a specific timeframe to replace the Plan body and is still in consultation.

The Planning Commission secretariat in a presentation said the new institution will evolve consensus on a national development strategy; foster cooperative federalism; define the reforms agenda; act as a platform for resolution of cross-sectoral issues before the centre and the states; act as an innovation hub and help in capacity-building; and act as a technology watch group.

PTI and Anuja contributed to this story.​

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Updated: 08 Dec 2014, 01:18 AM IST
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