India Replaces Nehru Era Economic Development Planning Body With New Think Tank

India on Thursday replaced its Planning Commission, a nearly 65-year-old economic policy-making body, with a new think tank. The move officially brings to an end a planned model of development that was put in place under the country's first prime minister, Jawaharlal Nehru, in 1950.

The NITI (National Institution for Transforming India) Ayog, as the new organization would be called, “will provide Governments at the central and state levels with relevant strategic and technical advice across the spectrum of key elements of policy,” the government said, in a release on the first day of the new year. The NITI Ayog, according to the government, will “provide a framework ‘national agenda’ for the Prime Minister and the Chief Ministers to provide impetus to.”

Ever since India started liberalizing its economy in 1991, it began discarding long-term economic planning in phases. On Aug. 15 last year, while addressing the nation on India’s independence day, Prime Minister Narendra Modi had announced that his government would wind up the Planning Commission and that a new organization would take its place.

This move is significant in that it renders obsolete a decades-old development model, which involved framing and implementing economic plans every five years, with little flexibility for course correction. Providing details about the role of the new think tank, the government said that the organization would advise it on “matters of national and international import on the economic front, dissemination of best practices from within the country as well as from other nations, the infusion of new policy ideas and specific issue-based support.”

NITI Ayog will be headed by the prime minister and have the chief ministers of all of India’s 29 states and governors of its federally administered territories as its members, along with some members of the federal cabinet. The new think tank would also have domain experts and academics from various fields in its ranks.

The government further said that the new organization, which seeks to provide greater participation to all of India’s federated units in its economic development, would also form regional councils within itself “to address specific issues and contingencies impacting more than one state or a region.”