In economic planning, Nehru was the architect of modern India. He wanted to eradicate poverty and industrialize the country to improve the lot of millions of trialise people in India.

Planning- a historic necessity:

After independence, Nehru tried to develop the lot of the poor in India. The growing unemployment and mass poverty allured his attention. It was a legacy of the British rule. The gross economic exploitation through ‘the drain of wealth’ had ruined our country.

Nehru came forward to eradicate the evils which were the legacies of the British rule by introducing planning in the country. So, it was historic necessity.


Democratic socialism:

Nehru’s economic planning was based on the idea of Democratic Socialism., in his own words- “I must frankly confess that I am a socialist and a Republican”. He combined socialist philosophy with democratic value. Removal of poverty; reduction of inequalities of income and wealth; provision of equal opportunities to all; social gain in place of private properties etc. were some of the features of socialistic pattern of society which Nehru wanted to implement in his planning.

Aims of planning:

Through planning, Nehru wanted to raise the standard of the’ people. He also wanted to see the growth of national income. He ‘also aimed at the growth of science and technology which will modernize India. Through planning, Nehru wanted to bring co-operative movement in India. Through Reserve Bank, Nehru provided concessional finance for promoting rural industrial co-operative societies. This provided support to rural artisans and cottage industries. Through co-operative societies he practically helped the weavers for promoting handlooms.


Nehru is considered as the father of public sector in India. He viewed that it was the public sector which would help for capitalist development. Having command over public resources of the State relating to production, consumption, distribution and investment, the goal of modernizing India will be fulfilled. His aim of increasing national income was fulfilled due to planning.

The national income during First Plan (1951-1956) increased by 18% against original expectation of 11%. During the Second Plan (1956-1961), national income increased by 20% over the base year 1955-1956. The over all increase in national income during these two early Five Year Plans was 42%.

However, the increase rate of national income became low in the Third Five Year Plan (1961-1966) due to Indo-Pak war.

Thus, Nehru’s economic planning based on the principle of Democratic Socialism bore fruit. It modernized an industrialized India. It was also successful to eradicate poverty by generating employment- The co-operative movement was still another novel feature of the economic planning of Nehru.