Central Economic Planning and India' Economic Performance, 1951-1965

In: The independent review: journal of political economy, Volume 16, Issue 2, p. 199-219

Abstract

While India remained under colonial rule during the first forty-seven years of the twentieth century, its national income grew at the low rate of 1.3 percent per annum. From 1900 to 1914, the growth rate was 1.45 percent, and income per capita grew by 1 percent per annum. Economic performance worsened between 1914 and 1947. The national income grew at an average rate of 1.08 percent per annum, and income per capita was essentially stagnant, recording a growth rate of 0.06 percent per annum (Roy 2006, 78).[l] In stark contrast, the growth rates of gross domestic product (GDP) recorded for independent India during the first fifteen years of central planning were much higher. India's GDP growth rate was nearly 4 percent per annum during the first two Five-Year Plans (FYPs), spanning the years 1951-56 and 1956-61, respectively, and it was 4.5 percent per annum during the first four years of the Third FYP, from 1961 to 1965 (Panagariya 2008,23).[2]. Adapted from the source document.