Economy on the Eve of Independence

Agriculture	Saddled with Surplus labor and extreme poverty
Industries	Crying for modernization, diversification, capacity building, increase public investment
Foreign trade	Oriented to feed industrial revolution in Britain
Infra	Needed upgradation, expansion and public orientation
Demography	Low population rate and social indicators are not good

Social and Economic challenges before the country are huge

Economic Growth

2% in aggregate growth rate in 1900-1950, <0.5% percapita output growth

Zamindari System	57% of total agri land	Prominent Bengal & Bihar, Odisha	Outsourced revenue collection to Zamindars
Ryotwari System	38% of total land	Madras, Bombay, Assam	Farmers direct tax payment to British
Mahalwari system	5% of total land	Punjab, NW provinces, Parts of Central India	Tax collected from village as a unit. Mahal-brotherhood

Agricultural land ownership scenario
75% of total agri land	7% villagers who are richest, zamindars, intermediaries
25% of total agri land	48% tenants and subtenants
No land ownership	45% villagers (agricultural laborer)

Economy from 1950-1990

Goal: Growth, Modernization, Self-reliance, Equity

Agriculture	Achieved Self-sufficiency but partial success in land reforms. Failed to reduce dependency of work force in agriculture
Industries	Diversified; Dissatisfied PSUs performance; Misuse of License raj, foreign protection; no focus on exports
Foreign trade	Inward looking policy, failed to develop exports
Infra	Inadequate
Demography	Population explosion with increased food grain production

Good start but not sufficient enough to face the existing social and economic challenges.

Achieved Food Security and growth, diversity in agricultural sector

Economy post 1991

LPG reforms

Agriculture	Growth decelerating and reforms not benefitting agriculture. Still high occupational dependency
Industries	Inadequate investment. Slow growth. Still unable to provide sufficient employment
Services	High growth. India became the service provider of the world
Foreign trade
Infra	Inadequate
Demography	Huge unemployment

Mixed results that aggravated inequalities

Overview

GDP Scenario	1950-51	1990-91	2019-20
Agriculture	59%	34.9%	14.8%
Industries	13%	24.6%	21.8%
Services	28%	40.5%	63.4%

Occupational Structure	1950-51	1990-91	2019-20
Agriculture	72.1	66.8
Industries	10.7	12.7
Services	17.2	20.5

Dadabhai Naoroji, Grand Old Man of India prepared the first estimates of National income in 1876.
Scientific procedure in estimating the national income was Dr. VKRV Rao in 1931

Five year plans in India

Concept of planning borrowed from USSR
Developed, executed, and monitored by the Planning Commission (1951 - 2014) and the NITI Aayog (2015 - 2017)

NITI Aayog Three Year Action agenda from 2017-18 to 2019-20

First	1951 to 1956	Agricultural development	Successful and achieved growth rate of 3.6% (more than its target)
Second	1956 to 1961	Industrial development	Achieved growth rate of 4.1%. Mahalanobis strategy
Third	1961 to 1966	Self-reliance	Due to china war, this plan could not achieve its growth target of 5.6%
Plan Holiday	1966 to 1969		Indo-Pakistan war & failure of third plan; No growth target Green revolution; Rupee devalued to make exports competitive
Fourth	1969 to 1974	Stable Growth and progressive achievement of self-reliance.	failed and could achieve growth rate of 3.3% only against the target of 5.7%.
Fifth	1974 to 1979 Stop 1978	Top priority was given to agriculture, next came to industry and mines	Growth of 4.8% against the target of 4.4%.
Rolling plan	1978-79
Sixth	1980 to 1985	Poverty eradication and technological self-reliance	Growth of 5.7% against the target of 5.2%
Seventh	1985 to 1990	Self-sufficient economy, opportunities for productive employment First time the private sector got the priority over public sector	Growth of 6% against the target of 5%
Annual plan	1990-91 1991-92
Eighth	1992 to 1997	Development of the human resources i.e. employment, education, and public health. New Economic Policy of India	Growth of 6.8% against the target of 5.6%
Ninth	1997 to 02	Growth with justice and equity	Failed to achieve the growth target of 7% and achieved 5.6%
Tenth	2002 to 07	Double the per capita income of India in the next 10 years. Reduce the poverty ratio 15% by 2012	Growth target was 8.0% but it achieved only 7.2%.
Eleventh	2007 to 12	faster and more inclusive growth	Growth rate target was 8.1% but it achieved only 7.9%
Twelfth	2012 to 17	Faster, More Inclusive and Sustainable Growth	Growth rate target is 8%

Indian Economy Evolution since Independence