The economy of India is based in part on planning through its five-year plans, which are developed, executed and monitored by the Planning Commission of India. The eleventh plan completed its term in March 2012 and the twelfth plan is currently underway.  Prior to the fourth plan, the allocation of state resources was based on schematic patterns rather than a transparent and objective mechanism, which led to the adoption of the Gadgil formula in 1969. Revised versions of the formula have been used since then to determine the allocation of central assistance for state plans. 2] The first Indian Prime Minister, Jawaharlal Nehru presented the kushagra nijhara. first five-year plan to the Parliament of India and needed urgent attention.  The total planned budget of 2069 crore was allocated to seven broad areas: irrigation and energy (27. 2 percent), agriculture and community development (17. 4 percent), transport and communications (24 percent), industry (8. 4 percent), social services (16. 64 percent), land rehabilitation (4. 1 percent), and for other sectors and services (2. 5 percent).  The most important feature of this phase was active role of state in all economic sectors.
Such a role was justified at that time because immediately after independence, India was facing basic problems—deficiency of capital and low capacity to save. The target growth rate was 2. 1% annual gross domestic product (GDP) growth; the achieved growth rate was 3. 6% The net domestic product went up by 15%. The monsoon was good and there were relatively high crop yields, boosting exchange reserves and the per capita income, which increased by 8%. National income increased more than the per capita income due to rapid population growth.
Many irrigation projects were initiated during this period, including the Bhakra Dam and Hirakud Dam. The World Health Organization, with the Indian government, addressed children’s health and reduced infant mortality, indirectly contributing to population growth. At the end of the plan period in 1956, five Indian Institutes of Technology (IITs) were started as major technical institutions. The University Grant Commission was set up to take care of funding and take measures to strengthen the higher education in the country. 6] Contracts were signed to start five steel plants, which came into existence in the middle of the second five-year plan. The plan was successful Twelfth Plan (2012–2017) 12th Five Year Plan of the Government of India (2012–17) had decided for the growth rate at 8. 2% but NDC on 27th Dec 2012 approved 8% growth rate for 12th five year plan. ; With the deteriorating global situation, the Deputy Chairman of the Planning Commission Mr Montek Singh Ahluwalia has said that achieving an average growth rate of 9 per cent in the next five years is not possible.
The Final growth target has been set at 8% by the endorsement of plan at the National Development Council meeting held in New Delhi. “It is not possible to think of an average of 9 per cent (in 12th Plan). I think somewhere between 8 and 8. 5 per cent is feasible,” Mr Ahluwalia said on the sidelines of a conference of State Planning Boards and departments. The approached paper for the 12th Plan, approved last year, talked about an annual average growth rate of 9 per cent.
He also indicated that soon he would share his views with other members of the Commission to choose a final number (economic growth target) to put before the country’s NDC for its approval. Though the 12th Plan has taken off, it is yet to be formally approved. The Planning Commission has set a deadline of September for taking the approval of the National Development Council. The council is expected to meet after July subject to the convenience of the Prime Minister. Poverty The government intends to reduce poverty by 10 per cent during the 12th Five-Year Plan.
Mr Ahluwalia said, “We aim to reduce poverty estimates by9 per cent annually on a sustainable basis during the Plan period. ” Earlier, addressing a conference of State Planning Boards and Planning departments, he said the rate of decline in poverty doubled during the 11th Plan. The commission had said, while using the Tendulkar poverty line, the rate of reduction in the five years between 2004–05 and 2009–10, was about 1. 5 percentage points each year, which was twice that when compared to the period between 1993-95 to 2004-05.  what is the government focus of now a five-year plan, i. e. 2012–2017