Think Learn & Perform (TLP)

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Day 46 – Q 3.The NITI Aayog has altered the philosophy and meaning of planning for development. Do you agree? Critically comment.

3. The NITI Aayog has altered the philosophy and meaning of planning for development. Do you agree? Critically comment.

नीति आयोग ने विकास के लिए योजना के दर्शन और अर्थ को बदल दिया है। क्या आप सहमत हैं? समालोचनात्मक टिप्पणी करें।


The National Institution for Transforming India, also called NITI Aayog, was formed via a resolution of the Union Cabinet on January 1, 2015. It has replaced the erstwhile Planning Commission established in 1950. NITI Aayog is the premier policy ‘Think Tank’ of the Government of India, providing both directional and policy inputs.


Uniqueness of NITI Aayog:

  • Bottom-up approach: NITI Aayog policy making is shaped by bottom-up approach rather than top-down approach followed by Planning Commission.
  • Co-operative federalism: NITI Aayog has fostered co-operative federalism through structured support initiatives and mechanisms through states.
  • Competitive federalism: NITI Aayog has put the onus of making states an attractive investment destination and timely implementation of implementing projects on the Chief Ministers, thus promoting competitive federalism among the states.
  • Customized approach: NIT aayog engaged in outcome-based monitoring with states in sectors such as healthcare, education and water supply. It is now mooting the idea of ranking each state based on health, education and water index, and identifying “champion states”.
  • Target specific: approach of measuring and monitoring progress through ranking and encouraging competition among states is akin to the approach adopted in promoting ease of doing business reforms. Example: composite water management index.
  • Fund allocation: Moving of fund allocation responsibilities to the ministry of finance, it has been empowered with the allocation of funds to central ministries, apart from overseeing fund flow from the Centre to the states.

NITI Aayog is old wine in new bottle:

  • Difficulty in implementation: Capacity constraints, inadequate resources, lack of incentives to perform, no disincentives for non-performance, absence of policy and regulatory clarity among others.
  • Practical vs theory: NITI Aayog has written a couple of policy papers on issues that involve the Centre and states; it’s unclear how effective it has been in changing policy.
  • Customized approaches are difficult: Differ with sector, geography and demography
  • Statistics and data: Data plays a key role in identifying causes and designing solutions. Agencies grappling with implementation should not be burdened with additional responsibilities of data collection and analysis.


It is high time that NITI Aayog realizes that it needs to metamorphose into an organization which can transform implementation of policy reforms in the country. It should be in a position to garner available independent expertise and capacity to objectively analyse specific governance or development challenges in a non-partisan manner, and design and implement solutions at different levels of governance

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