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Economic planning is a time-bound programme to achieve certain objectives by allocating available resources under the control of a central planning authority.
Prof. H. D. Dickinson defines economic planning as – “Economic planning is the making of major economic decisions such as what and how much is to be produced how, when and where it is to be produced, to whom it is to be allocated, by the conscious decision of the determinate authority, on the basis of a comprehensive survey of the economy as a whole.”
On the basis of the above definition, its main characteristics are:
Central Planning Authority (CPA): There is a central planning authority that formulates the plans. In India, this authority is known as Planning Commission.
Survey: There is a complete survey of the economy regarding the availability and use of natural and human resources.
Objectives: It lays down certain objectives which are realistic and flexible.
Priorities: Priorities are fixed according to the importance of each sector for its development.
Mobilization of resources: Resources are mobilised through various sources like taxation, deficit financing, savings, etc.
Plan period: Each plan is for a specific period, usually five years.
Evaluation: From time to time, an assessment of the plan objectives is done to make changes if necessary.
Continuous process: Economic planning is a continuous process which aims at the economic development of a country.
Co-ordination: In India, economic planning is implemented by the Centre and State Governments together.
Flexibility: There is flexibility in India’s economic planning so it’s possible to make changes as per the need.