A three-year medium term fiscal plan may be a befitting successor to India's long cherished Five-Year Plan for the years to come, Arvind Panagariya, the vice chairperson of the National Institute for Transforming India (NITI Aayog), said in his post-budget online media interaction Wednesday.
NITI Aayog was established a year ago by the Narendra Modi government after bringing down the edifice of Planning Commission â€” a relic from the Nehruvian-era. It was expected that the now-defunct commission's coveted Five-Year Plan would also be dispensed with soon.
"One direction seems to be clear that perhaps we will not be doing Five Year Plans," Panagariya said during the interaction, putting speculations to rest.
As 2016-17 would be the last year of the ongoing 12th Five Year Plan, it would also ensure an end to most things Planning Commission is associated with. India's annual financial statement's (budget) two-pillared classification of Plan and Non Plan will be its first target. This was made clear by the finance minister in his budget speech.
Spelling out the possibilities of what could come out of the new three-year MidTerm Planning, Panagariya expressed "a framework which may entail some sense of prediction on the next two or three years; what revenues could be garnered, and how the resulting expenditure will be allocated across different ministries."
The think tank's No. 2 boss (with the prime minister being the ex-officio chairperson) emphasised, "Somebody must do the planning of expenditure while the Finance Ministry finances and other ministries implement it." But such an expenditure-planning alone is not sufficient but a timely assessment would be required to reache its logical conclusion, he opined.
As the Aayog moves away from its predecessor's "planning-tag" and grows to become an external body facilitating the government functioning, Panagariya prefers to strengthen its new role to monitor and support policies.