CM KCR’s speech at meet on Planning Commission

Highlights of CM K Chandrashekar Rao’s speech at the meeting of State Chief Ministers and PM on the Review and Restructuring of Planning Commission

I. Introductory Remarks

I thank the Hon’ble Prime Minister for holding this meeting with the Chief Ministers. The proposal to form “Team India” with the Council of Chief Ministers and the Hon’ble Prime Minister as the chairperson to weave the economic agenda of the country together is welcome. I wholeheartedly compliment the Prime Minister for taking such a path breaking initiative. The development of India lies in the development of States. The country cannot be strong if States remain weak.

Photo: A group photo taken after the meeting of Chief Ministers with PM

II. Issues for Discussion

1. Cooperative Federalism: Platform for Interface between the Centre and the States
So far, there is no effective platform to enable the States to express their views at regular intervals and to participate in the formulation of national policies. The platform that is now proposed will have to be effective to move towards the goal of cooperative federalism.
For effective interaction and to promote a sense of involvement, the Council of Chief Ministers under the chairmanship of the Prime Minister may participate as members of “Team India” to deliberate and decide on all the general and important policy issues concerning the entire country. However, for issues specific to a region or a few States, such as the ‘Ganga Action Plan’ or ‘Left Wing Extremism’, Chief Ministers of States concerned may be grouped into Sub-Groups to deliberate on issues specific to them.

A Permanent Secretariat, with representation from each State, may be put in place to assist “Team India” in its deliberations. The Secretariat may seek policy briefs and expert advice from the proposed “Think Tank” or even co-opt other experts. All the papers relating to policy issues may be circulated by the Secretariat well in advance to facilitate an informed discussion.

2. Strategic and Perspective Planning

The “Team India” comprising the Council of Chief Ministers and the Prime Minister shall envisage a Vision and a Perspective Plan for the States and the country as a whole at least for a decade. The present plan cycle of five-years does not look beyond the short and medium term and the Plan gets prepared only after the completion of one or two years in the five year cycle.

The needs of States differ widely depending on the levels of development in different sectors. In addition, there are state-specific problems which need to be addressed at the State level. In view of this, States may be given the freedom to prepare their action plan within the broad parameters laid down in the Perspective Plan. These dynamic action plans may be for a period of three to five years and integrated fully with the annual budgets.

The Perspective Plan should be indicative and also facilitate the participation of the private sector in nation building. With the private sector providing close to three- fourths of investment, it needs to be provided with an enabling environment to thrive and to play a complementary role to the public sector.

The indicative planning with a longer perspective will provide an opportunity to States to implement decentralized planning as provided for in Article 243 ZD of the Constitution. In fact, the new State of Telangana has already taken the initiative of taking planning to the doorstep of people by launching “Mana Vooru – Mana Pranalika” or “Our Village-Our Plan” and moving up to “Our Block-Our Plan”, “Our District –Our Plan” and ultimately to “Our State-Our Plan”. This will result in a paradigm shift in the planning process by converting it from a bureaucratic to a democratic exercise.

The top down approach to planning and increase in the number of centrally sponsored schemes along with the allocative role of the Planning Commission has reduced the space available to States.

Despite the focus on balanced development, inter-state and intra-state differences have been increasing. The planning process should assume an effective redistributive role than in the past.

The present system of annual plan discussions with the Centre may be dispensed with.

3. Innovation and Knowledge Hub

The new institution’s primary role should be that of a “Think Tank”. The “Think Tank” should minutely examine present and future implications of each policy proposal and the new schemes. While the decision making will be done by “Team India”, “Think Tank” should provide technical inputs and will act as a friend, philosopher and guide.

The “Think Tank” will consist of experts in different subjects with proven track record. If necessary, experts from outside the country can also be inducted into the “Think Tank” selectively. Linkages may also be established with reputed global think tanks.
The Think Tank or the Knowledge Hub should be the repository of best practices and success stories pertaining to States and assist other States to adopt them depending on their suitability and adaptability. Necessary guidance to States and handholding them in new innovative practices may be provided.

The “Think Tank” may provide assistance and technical inputs to States to optimize the utilization of their resources and to achieve their potential.

4. Flow of Funds

In future, all transfers from the Centre may be based on the recommendations of the Finance Commission. The allocative role of the Planning Commission may be dispensed with. This will be in the true spirit of the Constitution and will result in doing away with the artificial distinction of transfers and expenditure into plan and non-plan. The Constitution does not provide for such a distinction.

Most of the Expert Committees have recommended such a system of transfers from the Centre. The Finance Commission transfers have been found to be transparent, formula based and equitable as compared with the present system of plan transfers.

Though there has been a reduction in the number of centrally sponsored schemes, it has not resulted in any increase in untied block grants to States. This can be done by drastically reducing the number as well as allocations under the centrally sponsored schemes and transferring the resultant savings to states through untied grants. The present practice of tied grants has impinged on the freedom of States and ignores diverse situations across States and even within a State. This will provide greater flexibility to States to cater to the felt needs of the people, which differ widely from State to State.
When the emphasis is on social justice and inclusive and sustainable growth, there is an imperative to realign resources in favour of States because the services and programmes which are at the core of more equitable social order come within the purview of States.

5. Concluding Remarks

I once again thank the Hon’ble Prime Minister for convening this meeting with the Chief Ministers to discuss the restructuring of the Planning Commission. In the present context of nation building and making up for lost opportunities, I offer the Hon’ble Prime Minister my full cooperation. The initiative to make the States equal partners in progress and empowering them will make India a strong and vibrant Nation.


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