Question

In which five year plan India opted for a Mixed Economy?

• A. Second Five Year Plan
• B. First Five Year Plan
• C. Third Five Year Plan
• D. None of the above

Answer 1

Answer:

A. Second Five Year Plan

• The Second Five Year Plan (1956-1961) was formulated under the leadership of Prime Minister Jawaharlal Nehru and was based on the P.C. Mahalanobis model. This plan marked a significant shift in India's economic strategy by formally adopting the concept of a mixed economy.

• Key features of the mixed economy approach in the Second Five Year Plan:

• Coexistence of public and private sectors: The plan established a framework where both government-owned (public) and privately-owned businesses would operate side by side.

• Socialist pattern of society: The plan aimed to establish a "socialist pattern of society" through economic planning.

• Focus on industrialization: Heavy emphasis was placed on rapid industrialization, particularly heavy industries like steel, mining, and machine manufacturing.

• Public sector dominance: The plan assigned a leading role to the public sector in developing strategic industries, while allowing the private sector to operate in consumer goods and other areas.

• Mahalanobis model: Named after statistician P.C. Mahalanobis (as noted in the similar questions section on the webpage), this model emphasized self-reliance and import substitution.