Previous Year Question

The Government of India established the National Institution for Transforming India—NITI Aayog to replace the Planning Commission.

NITI Aayog was constituted through a Union Cabinet resolution on 1 January 2015. Its purpose was to promote a more cooperative, participatory and bottom-up process of development between the Union and the States.

The Planning Commission had been established through a Government of India resolution on 15 March 1950. Like NITI Aayog, the Planning Commission was neither a constitutional body nor a statutory body created by an Act of Parliament.

The principal functions of the Planning Commission included preparing Five Year Plans, determining national priorities and playing a role in the allocation of resources connected with Plan Expenditure to States and Union ministries.

The major differences between NITI Aayog and the Planning Commission are:

• The Planning Commission followed a relatively top-down planning approach, whereas NITI Aayog emphasises a bottom-up approach and the participation of States.

• The Planning Commission prepared Five Year Plans, whereas NITI Aayog functions as a policy think tank that develops long-term policies, strategies and action agendas.

• The Planning Commission played a role in allocating plan-related financial resources; NITI Aayog does not allocate funds to States.

• NITI Aayog promotes cooperative federalism and, where appropriate, competitive federalism.

• NITI Aayog provides data, research, monitoring, evaluation and technical support for policymaking and to the States.

The Prime Minister serves as the Chairperson of NITI Aayog. Its Governing Council includes the Chief Ministers of States and Lieutenant Governors of the relevant Union Territories. Its structure may also include a Vice-Chairperson appointed by the Prime Minister, full-time members, ex-officio members and special invitees.

NITI Aayog replaced the Planning Commission, but it did not replace the Finance Commission. The Finance Commission is a constitutional body constituted under Article 280 of the Constitution. The National Human Rights Commission and the Law Commission also have different functions and institutional foundations.