Unit 2: Economic Planning in India (JAIIB-Module A)

1. What is the primary objective of economic planning in India?

• A. Increase only industrial production
• B. Promote foreign investment exclusively
• C. Achieve balanced economic growth and social welfare
• D. Focus only on agricultural production

Economic planning in India aims to ensure balanced growth of all sectors and improve social welfare, not just focus on one sector.

2. Who is responsible for formulating Five-Year Plans in India?

• A. Ministry of Finance
• B. Planning Commission (now NITI Aayog)
• C. Reserve Bank of India
• D. Finance Commission

Earlier, the Planning Commission formulated Five-Year Plans. Now, NITI Aayog performs a similar policy planning and advisory role.

3. When was the first Five-Year Plan launched in India?

• A. 1951
• B. 1947
• C. 1961
• D. 1970

The first Five-Year Plan in India was launched in 1951, focusing primarily on agriculture and irrigation.

4. Which of the following is NOT a feature of economic planning in India?

• A. Resource mobilization
• B. Balanced regional development
• C. Social welfare promotion
• D. Focus only on profit maximization of private firms

Economic planning in India aims at overall development, not solely private profit maximization.

5. What was the major focus of the first Five-Year Plan (1951-1956)?

• A. Heavy industry development
• B. Agriculture and irrigation
• C. IT and services sector
• D. Foreign trade expansion

The first Five-Year Plan prioritized agriculture and irrigation to ensure food security and increase productivity.

6. Which of the following is a primary objective of economic planning in India?

• A. Reduce regional disparities
• B. Increase only industrial profits
• C. Focus solely on urban development
• D. Restrict employment opportunities

Economic planning aims to reduce inequalities across regions, promote balanced development, and ensure inclusive growth.

7. One of the key objectives of economic planning in India is to:

• A. Limit agricultural production
• B. Promote only private sector growth
• C. Provide full employment and reduce unemployment
• D. Increase inflation deliberately

Planning in India focuses on creating job opportunities and reducing unemployment through public investment and sectoral development.

8. Which objective of economic planning emphasizes improvement in the standard of living of people?

• A. Industrialization
• B. Economic welfare and social justice
• C. Capital accumulation only
• D. Export promotion

Economic planning aims to improve people's living standards through equitable income distribution, social welfare schemes, and inclusive growth.

9. Balanced growth as an objective of economic planning refers to:

• A. Focusing only on metropolitan cities
• B. Increasing foreign investment exclusively
• C. Concentrating on a single sector of economy
• D. Simultaneous development of all sectors and regions

Balanced growth aims to prevent regional and sectoral disparities by developing agriculture, industry, infrastructure, and services together.

10. Which objective of economic planning focuses on reducing inequalities in income and wealth?

• A. Social justice
• B. Capital formation
• C. Export growth
• D. Industrial profit maximization

Economic planning ensures equitable income distribution, reduces poverty, and promotes social justice for inclusive development.

11. Which type of planning in India focuses on development targets for the entire country as a whole?

• A. Perspective planning
• B. Rolling plan
• C. Centralized/National planning
• D. Indicative planning

Centralized or national planning sets development targets for the entire country and allocates resources across sectors and regions.

12. Which type of plan sets long-term goals, usually spanning 15–20 years, for guiding the country's overall development?

• A. Perspective plan
• B. Annual plan
• C. Rolling plan
• D. Short-term plan

Perspective plans provide a long-term vision, usually for 15–20 years, and guide short-term and medium-term plans.

13. Which type of planning is prepared annually and approved by the government for implementing specific targets?

• A. Perspective plan
• B. Annual plan
• C. Rolling plan
• D. Indicative plan

Annual plans set yearly targets for sectors and regions, based on the guidelines of the ongoing Five-Year Plan.

14. Rolling plans are characterized by:

• A. Fixed long-term goals without changes
• B. Planning only for agriculture
• C. Annual review without revision
• D. Continuous revision based on performance and circumstances

Rolling plans allow flexibility by reviewing and revising targets periodically based on progress and changing economic conditions.

15. Indicative planning primarily aims to:

• A. Guide investment decisions without mandatory targets
• B. Set compulsory production targets for all sectors
• C. Control private sector activities strictly
• D. Focus only on rural development

Indicative planning provides guidelines for investment and resource allocation, especially for the private sector, without making them mandatory.

16. Which of the following is considered a major achievement of economic planning in India?

• A. Complete elimination of poverty
• B. Green Revolution and increased agricultural productivity
• C. Full industrialization in all regions
• D. Total eradication of unemployment

One of the key achievements of planning in India is the Green Revolution, which significantly increased agricultural output and ensured food security.

17. Planning in India has contributed significantly to which sector through the development of large-scale projects like dams and irrigation?

• A. IT sector
• B. Services sector
• C. Agriculture and infrastructure
• D. Textile industry only

Economic planning facilitated the construction of dams and irrigation projects, improving agricultural productivity and supporting rural development.

18. Which achievement of planning helped India attain self-sufficiency in food grains by the 1970s?

• A. Establishment of stock markets
• B. Growth of IT exports
• C. Privatization of banks
• D. Green Revolution

The Green Revolution introduced high-yielding varieties and modern agricultural techniques, helping India achieve food self-sufficiency.

19. Planning in India has played a role in promoting:

• A. Industrial growth and modernization of heavy industries
• B. Exclusive dependence on imports
• C. Complete elimination of regional disparities
• D. Restriction of private sector development

Economic planning supported the establishment and growth of heavy industries, infrastructure, and modernization of manufacturing.

20. Which of the following is considered an achievement of planning in India regarding employment?

• A. Complete elimination of unemployment
• B. Creation of numerous job opportunities through public sector projects
• C. Guarantee of employment for every citizen
• D. Restriction of labor mobility

Planning has helped generate employment via public sector undertakings, rural development programs, and infrastructure projects, though not full employment.

21. What is the primary source of funds for financing Five-Year Plans in India?

• A. Foreign loans only
• B. Private sector investments only
• C. Public savings, taxes, and borrowings
• D. Donations from international organizations only

Five-Year Plans are primarily financed through public savings, tax revenues, and government borrowings, supplemented by loans and foreign aid.

22. Which of the following is a domestic financial source for Five-Year Plans?

• A. Foreign direct investment
• B. Public sector savings and government taxes
• C. International monetary fund grants
• D. External commercial borrowings

Domestic financing of Five-Year Plans comes mainly from public savings, taxes, and internal government borrowings.

23. External resources for financing Five-Year Plans include:

• A. Loans and aid from foreign governments and international agencies
• B. Only private domestic savings
• C. Taxes collected from rural areas only
• D. Revenue from state lotteries

External resources include foreign loans and aid from international agencies to supplement domestic funds for Plan implementation.

24. Which method was used by the government to raise funds from the public for Plan financing?

• A. Export subsidies
• B. Import duties
• C. Privatization of industries
• D. Public saving schemes like National Savings Certificates

The government mobilized public savings through instruments like National Savings Certificates, postal savings, and small saving schemes.

25. Which financial source ensures stability and continuity in the funding of Five-Year Plans?

• A. Short-term foreign loans
• B. Government taxes and budgetary allocations
• C. One-time grants from international agencies
• D. Private charitable donations

Government taxes and budgetary allocations provide a reliable and continuous source of funding for Five-Year Plans.