Visvesvaraya Plan (1934)

Is one of India’s earliest modern economic planning ideas by M. Visvesvaraya (engineer & statesman, author of Planned Economy for India) in his book Planned Economy for India (1934). The plan came before the official Planning Commission era (pre-Independence). It aimed to transform India from an agricultural to an industrial economy and double national income in 10 years.

Key Points

1. Shift from Agriculture to Industry : Urged rapid industrialisation to absorb surplus rural labour and modernise the economy. Advocated building heavy industries, steel plants, machine tools, engineering goods.
2. Doubling National Income in 10 Years : Suggested a 10-year plan to raise productivity and national income to improve living standards.
3. State-Led Industrialisation : Wanted government to play a central role in establishing basic & heavy industries (since private capital was weak).
4. Infrastructure Development : Suggested public investment in power, transport, irrigation. Emphasised electric power, railways, roads, dams & irrigation as foundation for growth. Focus on hydro-electric projects and efficient transport systems.
5. Education & Technical Training : Stressed science & engineering education to create skilled manpower for industry.
6. Import Substitution : Reduce dependence on imported manufactured goods by building domestic industries.
7. Planned & Coordinated Economy : Proposed a central planning authority to set targets and guide industrial & agricultural growth.

Significance

1. First systematic, quantitative plan for India’s industrialisation.
2. Inspired later planning models — especially the National Planning Committee (1938) and the post-independence Five-Year Plans.
3. Showed the vision that India must industrialise to overcome poverty and backwardness.

The Bombay Plan 

Drafted in January 1944 by eight leading Indian industrialists J. R. D. Tata, G. D. Birla, Ardeshir Dalal, Lala Shri Ram, Kasturbhai Lalbhai, Purushottamdas Thakurdas, A. D. Shroff, John Mathai. The plan's official title was "A Plan of Economic Development for India". It was prepared when India was still under British rule; aimed to show that Indian business leaders supported planned economic development, not just free-market growth.

Key Points of the Bombay Plan

1. Time Frame & Investment : Proposed a 15-year plan with public & private investment of ₹10,000 crore (huge at that time). Focused on heavy spending in the first 5 years to kickstart growth.
2. Strong Role of the State : Surprising for big business: asked for state-led industrialisation in basic and heavy industries, transport, power, and infrastructure (since private capital alone was insufficient). Advocated nationalisation of key industries if needed.
3. Mixed Economy Model : Private enterprise in consumer goods and light industries. Government control in heavy industries, mining, defence production, railways, and power.
4. Agriculture & Rural Development : Emphasised irrigation, soil conservation, land reforms to boost productivity. Wanted credit and marketing support for farmers.
5. Employment Generation & Social Goals : Aim: full employment and doubling per capita income in 15 years. Focus on education, healthcare, social security to reduce inequality.
6. Self-Sufficiency & Import Substitution : Reduce dependence on British imports by developing domestic industries.
7. Planned Economy — Not Socialism : Supported planning & government control, but did not want full socialism; wanted a strong but business-friendly state.

A COMPARISON