Q.Why were the Five Year Plans discontinued after the Twelfth Plan?

The Five Year Plan system was discontinued after the Twelfth Plan (2012-17) because its rigid, centralised model no longer suited a fast-changing, market-oriented economy.

The Five Year Plan system, in operation since 1951, was formally discontinued after the Twelfth Plan came to an end in March 2017. Several factors lay behind this decision.

First, the fixed five-year time horizon and the detailed, centrally fixed physical and financial targets that characterised the Plans were increasingly seen as too rigid for an economy that, after the 1991 reforms, was far more open, market-driven and fast-changing than the economy for which the planning framework was originally designed; a five-year target set at the start of a plan period could quickly become outdated.

Second, the Planning Commission's centralised, top-down method of allocating plan funds to states was increasingly at odds with India's evolving federal structure and the growing economic and political weight of the states, who wanted a greater and more institutionalised say in setting national priorities rather than simply receiving centrally decided allocations.

Third, the Commission had no real accountability to Parliament and no constitutional or statutory backing, and there was a broader push toward institutions that could combine long-term strategic thinking with the flexibility to adapt more quickly than a rigid five-year cycle allowed. …

A common slip is assuming NITI Aayog was created only after the Twelfth Plan ended; in fact NITI Aayog was set up on 1 January 2015, while the Twelfth Plan (2012-17) was still te …