D E PA RT M E N T O F E C O N O M E T R I C S

UNIVERSITY OF MADRAS

EC O NO MI C PL A N N I N G
PR O C E SS I N TA MI L
NADU
INTERNSHIP REPORT

PRATISH P THOMAS
REG NO: 33150914
2009-2011
Table of Contents

A BRIEF INTRODUCTION ................................................................................................... 1

OBJECTIVES OF THE COMMISSION……………………………………………………………………………….2

ORGANISATIONAL STRUCUTURE ....................................................................................... 3

MAIN FUNCTIONS AND RESPONSIBILITIES OF THE COMMISSION ...................................... 6

THE PROCESS OF PLANNING (ANNUAL PLANS AND THE 5 YEAR PLANS) ......................... ……..7

CONCLUSION .................................................................................................................. 10

CLOSING REMARKS............................................................................................................. …..12

 ACKNOWLEDGEMENT

At the very outset, I would like to thank the Department of Econometrics for providing me

the opportunity to pursue the internship of my choice.

I found the timely support and council of Dr.R.Srinivasan (Associate Professor and member

of State Planning Commission), Dr.B.Viswanaathan (H.O.D of Plan Co-ordination),

Dr.P.Duraisamy ( Professor and Head, Department of Econometrics), and all other supporting

staff and heads of Department at the State Planning Commission most helpful, for without

which this report would not have come to fruition.

 A REPORT ON THE TAMIL NADU STATE

PLANNING COMMISSION

“Planning and applied evaluation is the key to

economic development.”
- State Planning Commission

A BRIEF INTRODUCTION:

The State Planning Commission was constituted on 25th May, 1971 under the Chairmanship

of the Chief Minister Dr. M.Karunanidhi, as the nodal body that facilitates in state planning

activities and acts as an advisory body to the state government on various plans and policies

that are being, or is to be pursued by the state.

The history of planning in our country can be traced to post-unionised India in 1951, where

the then Prime Minister, Pandit Jawaharlal Nehru had come to favour „Centralized State

Planning‟ as the means to spur rapid economic development and bridge the gap between the

various economic and social groups. This worked efficiently in most states due to a single

party at the helm at both the states and centre. This changed by 1967 with regional parties

emerging from the various states, in particular the ascent of the D.M.K in Tamil Nadu headed

by the erstwhile Perarignar Anna. This shift in the political setup between centre and state

posed a set of new challenges in the execution of the 5 year-plans. This required for the

setting up of various state level bodies to aid the centralized process of planning as well as to

project the needs of the state from a localised perspective.

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For this purpose alone, the state the Tamil Nadu instituted the State Planning Commission.

The Tamil Nadu State Planning Commission, unlike other planning bodies in the country has

a more structured and formal setup, thus laying more emphasis on the nature and the process

of planning. One may also note the striking similarities between the organisational structure

of The State Planning Board of Kerala and that of T.N.S.P.C.

Since the conceptualisation of the S.P.C which coincided with the 6th plan, we now are in the

midst of the 11th plan for the period 2006-2011.

OBJECTIVES OF THE COMMISSION:

The objectives of state planning are on the lines of the central planning objective, i.e. to

spear-head rapid growth and maintain sustainable growth of the economy, coupled with

social justice. Safeguarding the livelihood of the people through providing adequate

educational and employment opportunities, which is a major thrust area for the Eleventh

Plan.

In addition, the Eleventh Plan will aim to upgrade the quality of life of the urban and rural

population by providing essential infrastructure, thereby ensuring and enhancing the delivery

of basic civic services such as water supply and sanitation. The state has adopted a targeted

overall growth rate of 9% on par with the recommendations of the National Development

Council for the Indian economy.

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ORGANISATIONAL STRUCTURE:

The commission is headed by the Chairman which is by default, the Chief Minister unless

otherwise instructed by the Chief Minister himself to be replaced by a suitable head which in

most cases is an officer of the I.A.S. This setup however, was constituted only a few times.

Serving under the Chairman we have the Vice- Chairman who draws in his faculty which can

be observed from the organisational chart above.

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The full-time members, part-time members as well as the Ex-officio members are drawn in

from eminent public figures as well as experts and academicians.

The 7 departments under the Member Secretary perform various roles related to the

administration, planning process and other auxiliary functions of the state planning

commission. The library and computer centre is one such example of the auxiliary bodies.

These 7 divisions assist the part-time and ex-officio members in their respective works with

regards to planning.

It is the Technical Divisions that deal with the real aspect of planning and policy framing.

The areas of focus are:

1. Agricultural Policy and Planning

2. Industries, Power and Transport

3. Land Use

4. Rural Development

5. Health and Social Welfare

6. District Planning

7. Plan Co-ordination

Each Technical Division is headed by a senior officer drawn with relevant expertise from the

concerned development departments of the State or Union Governments; he is to be the Head

of Department. Supporting the H.O.D we have the Planning Officer (P.O), Technical

Assistants (T.A) and Planning Assistants (P.A).

Each division has on an average, 4-5 personnel involved in the preparation of the Plan

Documents and policy framing in their respective sectors.

The number of sectors per division varies from 2-3 till about 7 to 8 for some.

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For example:

1. We have the Land Use division that looks into:-

o Forest, Animals and Wildlife

o Irrigation

o Wasteland Management

2. The Agricultural Policy Planning Division looks into:-

o Animal Husbandry

o Fisheries

o Horticulture

o Fertilizers

o Soil Conservation and Watershed Management

o Agricultural Marketing and Quality Control

o Agricultural Research and Education

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MAIN FUNCTIONS AND RESPONSIBILITIES OF THE COMMISSION:

 To advise the Government on the priorities of the Eleventh Five Year Plan and

Annual Plan.

 To prepare and send the draft Eleventh Five Year Plan and Annual Plan to the

Government for approval and send the same to the Union Planning

Commission.

 To review the progress of implementation of projects and programmes

included in the Eleventh Five Year Plan on a periodical basis, with reference

to achievement of targets/goals envisaged in the Five Year Plan.

 To undertake Mid-Term review of the Eleventh Five Year Plan and advice the

Government on appropriate modification/restructuring of the schemes.

 To undertake evaluation of major plan schemes through the Evaluation and

Applied Research Department and recommend to the Government the

measures necessary to restructure or improve the schemes based on such

evaluation.

 To advise the Government on the effective implementation of Decentralised

District Planning (DDP) with reference to existing guidelines and

Government orders.

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THE PROCESS OF PLANNING:

From the above, one can have an understanding of the functions and responsibilities of the

S.P.C but most importantly, we must have an insight into the „Process‟ of planning.

The “Plan documents”, namely in this case would be referring to the Preparation of the

Annual Plan Documents as well as the coveted 5-year Plan documents. It is through the

manifestation of the various schemes and programmes outlined in the “Plan Document” that

serves out the objectives of planning.

The preparation of the 5-Year Plan is done once every 5 years and takes one whole year to

prepare, and is indeed a very laborious and intense process that requires the commissioning

of several “Steering Committees” and “Working Groups” as well as their close co-operation

so that no clash of interests arise, especially with regards to fund disbursement and

redistribution amongst several competing schemes and sectors. For the plan year 2007-11,

there have been 13 steering committees and 38 working groups.

. In addition to the Annual Plans for the five years from 2007-08 to 2011-12, it is proposed to

prepare a “Perspective Plan” for important development sectors during the Plan period. This

will serve as a “Mid-Term Review” of the plan schemes and help to identify the gaps in

implementation as well as resources for achieving the plan objectives.

The order of events is given below:

 5-YEAR PLANS:

1. At the first month of the final year of an On-going 5yr. plan, the preparations get

under-way to come up with a central theme for the Up-coming 5 yr. plan. Any

objectives not mete out in the previous 5yr. plan are to undertaken in the

subsequent plan document, if the urgency or the priority still arises.

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 Regional Consultation Workshops with various Stake holders are also first held,

i.e. elected representatives, M.P‟s M.L.A‟s Panchayat members and University

experts.

2. The main work-force and machinery that get employed into the rigorous process

of planning is achieved once the commissioning of the “Steering Groups” and the

“Working Groups” gets under-way. The former is the body that undertakes

streamlining and designing broad- policy objectives while the latter gets employed

to work upon the basic schemes laid forth by the Steering committee.

“One likens the relationship between the Working Group and the Steering

Committee as that of a Hammer and the Anvil. The working Group adds the

punch and irons out all differences and irregularities in the proposed plans while

the Steering Committee provides the solid foundation and support from where

such well-sounded ideas takes shape in the first place.”

3. By the month of January to February the plan document is sent to the Union

Planning Commission for approval of the allotted budget and the nature of the

schemes. Here apart from finances, nothing else is meddled with unless otherwise

found to be maligned or detrimental to the growth and security of the nation and

state as a whole.

4. By the 1st week of March, the final approved draft makes its way from the U.P.C

to the State Budget session for approval, where any other Fully State Sponsored

Schemes can be introduced at this time.

 And with the ratification of the Plan Document at the State Assembly Budget

Session, the fruition of the 5-Year Plan Document has come to be.

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The preparation of the Annual Plan document is a yearly phenomenon, consisting of what is

called Part I schemes (i.e. the on-going schemes) and the Part –II schemes (i.e. the newly

constituted scheme),which aims to carry forth the broad objectives and targets set forth in the

5-Year Plan documents.

The order of events is given below:

 ANNUAL PLANS

1. September to November: The preparation works commences and the plan meetings

are held among various concerned bodies right from the local level upwards, not to

mention the departments for the respective scheme and sectors. Intra-department

consultations at the S.P.C are conducted in tandem to prevent clashes of interests as

well as to have an idea of the finance and fund availability distribution for the

upcoming-yet-to-be proposed schemes.

2. January to February: Consolidation of the various plans is undertaken and once

compiled a draft document is prepared and submitted to the Union Planning

Commission. It is the Union Commission that approves the various developmental

schemes that are to have Centre-State funding or complete centre funding in the name

of special projects.

E.g.: The up-coming water Desalination plant in Nemmeli, Chennai

Also, any National Schemes to be carried out in the state is added into the document

at this point.

E.g.: the execution of the J.H.N.UR.M Scheme in Tamil Nadu.

3. March: The approved plan document is sent back to the state where it is approved in

the State Assembly Budget Session held in the month of March. Here any additional

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 state level scheme to be funded wholly by the state is brought up and added in the

Plan document.

E.g.: The “Kalignar Housing Scheme” is one such case where at the time of Budget

Session it was introduced as a special initiative welfare scheme by the D.M.K ruled

State government of Tamil Nadu

One can also note at this point, that in terms of “Expenditure”, the S.P.C focuses on two

aspects of it:

1. Plan Expenditure: The list of projects and schemes that require the respective funding

for such development activities to be carried out.

2. Non-Plan Expenditure: This aspect covers the Salaries, Subsidies (such as P.D.S) as

well Pensions issued to Staff and any other forms of Administrative Cost.

CONCLUSIONS:

 The nature of planning carried out by the Tamil Nadu State Planning Commission is

by any means, of repute and shows the presence of an able-bodied administration that

has been keen and prompt to develop many developmental schemes and programmes

for the state and its people.

The rather formal structure of the State Planning Commission clearly does justice to

itself as compared to the many other states where “Planning” is restricted to a

seasonal board or the division is incorporated and attached to another department.

 One of the main difference between the S.P.C and U.P.C lies in the fact that the

former is not constitutionally mandated, in the sense that whatever be the

recommendations of the S.P.C to the State Government, it is not binding to the State

Government. The fact lies on the matter that if the State Government comes up with

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 a Scheme that is not well-sounded or economically unviable but has the mandate of

the State Assembly and the people by and large , the S.P.C is not in a position to

discard it, rather it sees what best it can do to remedy the situation and incorporate

such a scheme into its plan

The above is by and large, the only structural difference between centre and state

planning commissions.

 From the 11th Plan period onwards, a new feature is now installed into the Planning

machinery, and that is the of “ Mid-Term Review or Appraisal” where after 2 and a

half years into the plan period, an “appraisal” is called for all the sectors to which

schemes have been formulated and put into effect.

The purpose of intent for such a “Mid-Term Review” would be to bring to light the

level of progress such priority sectors are making and prepare a “Performance

Report” on which necessary corrective action could be charted out so as to put it

back onto the original growth track.

 Tamil Nadu has exhibited one of the strongest growth index in all quarters in recent

times, i.e. in terms of health, education, std.of living and overall industrial growth,

given the size of the state and its associated problems.

Given the political will, the role of Planning no doubt, plays a very important role in

prioritising the broad-policy- objectives for the state once in every 5 years, thus

leading to a sound economic growth that wouldn‟t have resulted if banked on will

alone.

The primary focus of the S.P.C since its inception had been that of upliftment of the

rural class and a revival in the agricultural sector. Over time other pertinent matters

relevant of the time also came into focus (as with the case of non-farm sectoral

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 growth post 1990), such as the case of the development of Tamil Nadu into an

industrial power house.

 With the establishment of a very capable port in Chennai as well as the development

of auxiliaries at Ennore as well as Tiruchirapalli, the state is very well on its way on

map of economic importance and as a link to the south-east Asian Markets. Many of

the well-known foreign auto-mobile manufactures (Hyundai, Ford, Nissan-Renault)

have established their factories in Chennai, and many more are showing key interest.

 The 11th Plan strategy is drawn up based on the past developmental experience. The

main philosophy of the current plan is that of Inclusive Growth and that of utilizing

private investment being channelled towards the priority sectors, where they will be

economically productive and socially relevant.

E.g.: The case of Corporate Farming as well as the development of the I.T.E.S sector.

CLOSING REMARKS:

I thus conclude my report on the State of affairs that was, during my brief term spent at

the Tamil Nadu State Planning Commission (T.N.S.P.C) and have learned immensely as

well as nurtured a firm sense of appreciation towards an organisation dedicated in the

meticulous planning for the betterment of its people.

Planning is never a futile exercise is what one learns from the above, one may not have

all plans to the liking of the people, but one among the many will find its way through

and it is these plans that have foresight and a long-term welfare perspective in view, a

quality that is well characterized in the Tamil Nadu State Planning Commission.

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