The Government has decided to abolish the Planning Commission, a 64-year-old apex policy-making body, and replace it with a new institution to address the emerging economic needs and strengthen the federal structure.

“We will very soon set up a new institution in the place of Planning Commission,” Prime Minister Narendra Modi said in his Independence Day address to the nation today.

The Planning Commission, he said, was set up to cater to the needs of earlier times and has participated in his own way in the development of the country.

However, Modi said: “The internal situation of the country has changed, global environment has changed... If we have to take India forward, then States will have to be taken forward. The importance of federal structure is more today than it was in last 60 years.’’

New shape to Plan panel

He further said there is a need to have a relook at the structure of the Planning Commission and give it a new shape.

“Sometimes it becomes necessary to repair a house. It costs a lot of money. But it does not give us satisfaction. Then we feel it is better to make a new house,” he said.

“We need an institution of creative thinking and for optimum utilisation of youth capability,” he said, asserting that the country has to push Public Private Partnership (PPP) model and strengthen federalism.

The Planning Commission was set up in March 1950 by India’s first Prime Minister Jawaharlal Nehru to promote a rapid rise in the standard of living of the people by efficient exploitation of the resources of the country, increasing the production and offering opportunities to all for employment in the service of the community.

Welcoming the decision, former Planning Commission member Bimal Jalan said: “It is very good idea. Planning has become outdated concept now. There is a need to modernise it. We have to see the blueprint of the new concept. But change was very much required.”