NITI Aayog

Also called: National Institution for Transforming India · Topic: Regional Planning and Sustainable Development in India · NCERT: Class 12, Ch 6 "Planning and Sustainable Development in Indian Context"

Meaning

NITI Aayog (National Institution for Transforming India) is a policy think tank (a body that gives advice and ideas). It replaced the Planning Commission through a Union Cabinet resolution dated 1 January 2015 [2][3]. It gives strategic and technical advice to the Union and state governments, and it does not share out plan money.

It matters because it changed how India plans. Planning used to be top-down and run by the Centre, which also controlled the funds. NITI Aayog follows cooperative federalism, where the Centre and the states work together as partners.

Explanation

Why the Planning Commission was replaced

• The old model was centralised.
• The Planning Commission was set up on 15 March 1950 by a Cabinet resolution [4]. It made plans at the top and passed them down to the states.

• It divided plan money among Union ministries and states. This gave it strong financial power.

• One plan made in Delhi did not suit every region.

• Hills, deserts, drought-prone plateaus and tribal belts have very different needs.

• The gaps between regions grew wider. Over time, India moved towards decentralised multi-level planning (planning at the Centre, state and district levels).

• The result: in 2015, India set up an advice body instead of a body that controlled funds. The Twelfth Plan (2012-17) was the last Five Year Plan. After 2017, vision and strategy documents took the place of Five Year Plans.

How NITI Aayog works

• Policy think tank: it gives ideas and advice. It does not run large spending programmes.
• No plan funds: it does not allocate plan funds. This is the main difference from the Planning Commission.
• Cooperative federalism: it gives regular, organised support to states. Its idea is that strong states make a strong nation [2][3].

• Earlier, policy flowed one way, from the Centre to the states. NITI Aayog aims to replace this with a lasting partnership with the states [2].

• Governing Council: this is part of NITI Aayog's structure. It is the platform where the states and the Centre work on national development goals together [2][3].

• Advice: it gives strategic and technical advice on key areas of policy to both Union and state governments [2][3].

Legal status

• It was created by a Union Cabinet resolution, not by the Constitution or by an Act of Parliament [2].
• So it is non-constitutional (not created by the Constitution) and non-statutory (not created by a law passed by Parliament). The Planning Commission had the same status.

Tools it uses to push development

• Aspirational Districts Programme (2018): it works on the three Cs [6]:
• Convergence: Central and state schemes work together in the same district.
• Collaboration: Central and state nodal officers work together with District Collectors.

• Competition: districts are compared every month through a delta ranking (a score of how much each district has improved).

• SDG India Index: it ranks states on the Sustainable Development Goals (SDGs).

• Rankings in place of money: because it has no funds to give, it guides states mainly through advice, data and competition.

Where it occurs

• Level: it is a national body that advises the Union government and all state governments [2][3].
• Set up: 1 January 2015 by a Union Cabinet resolution, replacing the Planning Commission (1950-2014) [2].
• Aspirational Districts Programme: launched by the Prime Minister in January 2018. It aims to change the 112 least-developed districts of India quickly and effectively [6].
• The baseline ranking covered 115 districts [7].
• Many of these districts are tribal or affected by Left Wing Extremism.
• It uses 49 Key Performance Indicators (KPIs) under 5 themes [7]. Health and nutrition carries 30% and education carries 30%.

• Progress is shown on the Champions of Change dashboard [6].

• SDG India Index: compares Indian states on the Sustainable Development Goals.

Don't confuse with

• Planning Commission: it made and funded the twelve Five Year Plans (1950-2014). NITI Aayog only advises and does not allocate plan funds.
• National Development Council (NDC): it helped coordinate the Five Year Plans and approved them before they began [5]. The Governing Council of NITI Aayog is a platform where the Centre and states work together on development goals [2][3].
• Constitutional or statutory body: NITI Aayog is neither. It was created by a Cabinet resolution, not by the Constitution or an Act of Parliament.
• Sectoral planning vs regional planning: sectoral planning works on one sector, such as power or agriculture. Regional planning works on one area. NITI Aayog's Aspirational Districts Programme is a form of regional (area-based) planning.

Prelims Hooks

• NITI Aayog was set up on 1 January 2015 by a Union Cabinet resolution [2]. It is non-constitutional and non-statutory.
• Trap: "NITI Aayog allocates plan funds to states" is wrong. Only the Planning Commission did that.
• The Planning Commission was set up on 15 March 1950 by a Cabinet resolution [4]. The Twelfth Plan (2012-17) was the last Five Year Plan.
• NITI Aayog's guiding idea is cooperative federalism, and its Governing Council brings the Centre and the states together [2][3].
• Aspirational Districts Programme: launched January 2018; covers 112 districts; tracked by a monthly delta ranking [6].
• The programme uses 49 KPIs under 5 themes. Health and nutrition and education carry 30% each [7].

Mains Points

• From top-down planning to cooperative federalism (GS-I, regional development):
• A single national plan made the gaps between regions wider. This led to target area programmes and later to multi-level planning.

• NITI Aayog takes this shift further. It treats the states as partners instead of passing policy down from the Centre [2].

• Strengths and limits of NITI Aayog:

• Strength: states get more say in policy, and the Governing Council gives them a shared platform [2][3].

• Limit: without power over funds, it can influence states mostly through advice, rankings and indices such as the SDG India Index.

• Aspirational Districts as area-based planning (GS-I/GS-III):

• It focuses on the least-developed districts. It uses convergence of schemes, live data and competition between districts (delta ranking) to reduce gaps within states [6].
• It is a good example of planning that is measured by results and linked to sustainable development.

Related concepts

• Five Year Plans
• Planning Commission

Read more

• Planning in India: Five Year Plans, the Planning Commission and NITI Aayog