Second Five Year Plan ( 1956 - 1961 )
The Second Five Year Plan in India was a crucial period in the country's economic development, spanning from April 1956 to March 1961. Building on the foundations laid by the First Five Year Plan, it marked a significant shift in India's economic strategy.
Here are the key aspects of the Second Five Year Plan:
Focus on Industrialization: The primary objective of the Second Five Year Plan was rapid industrialization, with a particular emphasis on heavy and basic industries. This was a deliberate move away from the First Plan's focus on agriculture. The idea was to build a strong industrial base that would support long-term economic growth and reduce India's dependence on imports for industrial goods.
Mahalanobis Model: The plan was formulated based on the Mahalanobis Model, developed by the renowned Indian statistician Prasanta Chandra Mahalanobis. This model advocated for a strategy of investing heavily in the capital goods sector (industries that produce machinery and equipment) to stimulate overall economic growth in the long run.
Public Sector Dominance: The plan envisioned a significant role for the public sector in driving industrial development. Several public sector enterprises were established during this period, including major steel plants at Bhilai, Durgapur, and Rourkela, with assistance from the Soviet Union, the UK, and West Germany, respectively.
Key Initiatives:
Establishment of hydroelectric power projects.
Increase in coal production.
Expansion of railway lines.
Setting up of research institutes like the Tata Institute of Fundamental Research and the Atomic Energy Commission of India.
