Lesson 02: Economic Planning in the Light of Five Year Plans

Lesson 53/61 | Study Time: 30 Min
Lesson 02: Economic Planning in the Light of Five Year Plans

(A Survey of the Development Plans) 



FIRST FIVE YEAR PLAN (1955-60) 



Strategy: Development of the rural and agriculture sectors was placed on top priority, a balanced approach between the agricultural and industrial sector was stressed. Twenty nine percent of the total expenditure during the plan was earmarked for the development of water and power resources. Major part of the expenditure required for development schemes was to be generated from indigenous resources. 



Targets: Following development targets were set for the First Five Year Plan. 



i. To improve the general living standards of the people. 



ii. To improve balance of payments by increasing exports. 



iii. To create more job opportunities and reduce unemployment. 4. To improve health, education and other social services. 



Failures and Successes:



i. National income was increases by 11 percent; the target was set at 15 percent. 



ii. Increase in annual per capita income was recorded at 1.6 as against the anticipated target of 7 percent. 



iii. On million acres of barren lands were reclaimed for cultivation against the target set at 1.5 million acres. 



iv. New industries were established. 



v. Commendable ale improvement was made in railway and transport sectors. 



vi. No mentionable success was achieved in the field of mineral development except in the field of natural gas. 



 



SECOND FIVE YEAR PLAN (1960-65) 



The plan was launched in July 1960. 



Strategy: Based on the lessons learnt from the shortfalls of the First Five Year Plan the Plan was designed with the main purpose of consolidating the successes achieved during the First Plan. Its strategy was based on the principle of maintaining a balance of growth between different sectors. It was expected that with the passage of time economy will achieve an automatic development level. Schemes yielding quick results were given priority. 



Targets: 



i. Twenty Four percent increase in national income. 



ii. Twelve percent increase in the annual per capita income.' 



iii. Twenty one percent increase in the production of food grains. 



iv. Twenty percent increase in the production of medium and large industries. 



v. Creating three million additional job opportunities. 



vi. Increasing foreign exchange earnings by 15 percent during the five years of the Plan. 



Failures and Successes: 



i. National income increased by 37 percent against the stipulated target of 24 percent.



ii. Level of internal saving was recorded at 1145 crore against the target of 1880 crore. 



iii. Increase in the per capita income was 14 percent which was higher than the target i.e. 12 percent. 



iv. Target of increase in the production of food grains was recorded 27 percent against the target of 21 percent. 



v. Industrial production increased by 61 percent, higher than the set target 40 percent. 



vi. Target to enhance foreign exchange earning was set at 3 percent per year, but it actually increased at a commendable rate of 7 percent per year. 



 



THIRD FIVE YEAR PLAN (1965-70) 



Strategy: Third Five Year Plan was launched as the first phase of 20-year Perspective Plan (1965-85). The planners noted with concern that although notable progress was achieved during the last two Five year plans, yet due to certain shortcomings of the development strategy the gap between the incomes of different income groups kept widening with the passage of time. To reduce disparity between the incomes of different groups was an important target set for the Third Five Year Plan. 



Targets: 



i. Development target was set at 6.5 percent against 5.2 percent of the Second Five Year Plan. 



ii. Target of development in the agriculture sector was reduced to 3 percent per year as compared to 3.4 percent per year of the Second Plan. 



iii. Average of Savings during the Second Five Year Plan was 10 percent per year; this was targeted at 13.6 percent per year. 



iv. It was planned that imports will be reduced and exports increased at the rate of 9.5 percent per year. 



v. It was said that unemployment will be reduced at the rate of 17 percent and to meet this target 5.5 million new job opportunities will be created. 



Failure and Successes: 



Third Five Year Plan could not achieve the stipulated targets for certain reasons i.e. 



i. 1965 Indo-Pakistan war. 



ii. Suspension of American aid due to war. 



iii. Damages caused by drought, floods and hurricanes. 



In spite of all these adversities 5.8 percent increase was recorded in the GNP and approximately about 4 percent increase in the agriculture produce. The plan failed to achieve almost all the targets set, for example only 6 percent increase in the savings was achieved against the target set at 20 percent. 



 



FOURTH FIVE YEAR PLAN (1970-75) 



This plan was also launched as a part of the Perspective Plan 1965-85. Its objectives, laid down by the Planning Commission of Pakistan are restated here: 



All our efforts are focused at establishing a just and equitable society. We may not have resources, enough for the total elimination of poverty, but we can at least, do something to alleviate some of its hardships. Each citizen, irrespective of his social status, should be given equal opportunity to give his children standard education, should be given just and favorable remuneration of his work and shall have full opportunity to apply his potentials for the attainment of a status equal to his efforts. Opportunities in all walks of life should be provided on the basis of equality and justice. 



Since this Plan could not be carried out due to the political crisis that resulted in the creation of Bangladesh in 1971 and the Indo Pakistan War on the same issue, evaluation of its success and failures in not called for. 



 



FIFTH FIVE YEAR PLAN (1978-83) 



We have seen earlier that the Fourth Five Year Plan had to be called off due to the East Pakistan Tragedy of 1971. The new government tried to substitute the practice of five year planning with planning with planning on yearly basis. Since this practice failed to produce desired results, from 1978 onward the practice of five yearly planning was restored. 



Targets: 



i. Provision of the basic amenities of life to the people. 



ii. Creation of more job opportunities through rapid economic progress and increase in income. 



iii. Improvement of the facilities of health, education, transport and drinking water. 



iv. Developing the backward areas by providing basic amenities of life. 



v. Saying the foundations of long term development by establishing basic industries. 



Failures and Successes: 



i. GNP enhancement was targeted at 7 percent; only 6 percent could be achieved. 



ii. Ninety-five percent of the targets regarding agriculture sector were achieved. 



iii. Targets regarding industrial sector were nearly achieved. 



iv. Annual per capita income was increased. 



v. Ninety-three percent targets regarding energy sector were also achieved. 



vi. Success rate in the transport sector was 106 percent. 



vii. Public sector investment came down by 33 percent. 



 



SIXTH FIVE YEAR PLAN (1983-88) 



Sixth Five Year Plan was launched in July 1983. 



Strategy: 



i. Social consciousness is a pre-requisite for evolving a solid development base. 



ii. Fruits of economic progress can be made available to the common man only by ensuring his active participation in economic activity. 



iii. Participation of the private sector is to be maximized. 



Objectives and Targets: 



i. Provision of the basic needs of life like health, drinking water and primary education to be placed on top priority. 



ii. Provision of the basic infrastructure in the rural areas. 



iii. Backward and underdeveloped areas like Balochistan to be developed on priority basis. 



iv. Uplift and security of the most poor and the deprived section of the society. 



v. Mother and child care. 



vi. Expansion of the employment facilities. 



vii. Nearly 13 percent of the total development budget was earmarked for social uplift i.e. health, education and population welfare. 



Failures and Successes: 



i. Target of increasing the GDP was achieved. 



ii. Agriculture sector showed signs of improvement but the targets could not be achieved. 



iii. Progress made in the energy sector was commendable. 



iv. Education sector development indicators were also positive, 12 thousand new primary schools and 17 thousand Masjid schools were opened. 



v. Literacy rate could not be enhanced. Target was set to achieve 48 percent literacy rate but it could not cross the limit of 30 percent. 



vi. Number of doctors at rural and urban levels was increased but other targets set for health sector were not achieved. 



vii. Ratio of inflation was kept lower as compared to the previous Five Year Plan. 



According to the economists, the Plan was generally successful in achieving its targets. 



 



SEVENTH FIVE YEAR PLAN (1988-93) 



Strategy: 



Seventh Five Year Plan was based on the concept that in order to improve the living standards of the people it is necessary to enhance production. It was also stipulated that the Rs. 95 billion gap between savings and expenditure will be met through foreign resources. 



Targets: 



i. Increase in the GDP and the per capita annual income. 



ii. Development of the surface and sub-soil water resources. 3. Increase in the production of electricity. 



iii. Increase in savings. 



iv. Enhancement of the production of the industrial sector. 



v. Improvement of the basic social services i.e, health, education and drinking water etc.



Failures and Successes: 



Due to abrupt governmental changes and uncertain international conditions the Plan failed to achieve most of its targets, but if judged in view of the objective conditions it was made to operate in, its achievements were satisfactory. 



 



EIGHTH FIVE YEAR PLAN (1993-98) 



Strategy: 



The Plan was based on the following basic concepts: 



i. Individual capabilities shall be strengthened. 



ii. Private business activity shall be encouraged. 



iii. Market system and techniques shall be improved. 



iv. Poverty alleviation programme shall be carried out with the help of the public sector. 



TARGETS: 



i. Forty percent increase in the GDP and 22 percent increase in the annual per capita income. 



ii. Five percent increase in agriculture produce and 10 percent expansion of the manufacturing sector. 



iii. Reduction of the budget deficits. 



iv. Enlargement of the volume of national savings. 



v. Creation of more employment opportunities 



vi. Enhancement of the level of literacy from 35 percent to 45 percent. 



vii. Creation of better health facilities. 



Failures and Successes: 



i. Economic growth rate was targeted at 7 percent per annum but actual growth rate achieved was 5 percent. 



ii. In certain other sectors growth rate achieved was higher than the target. 



iii. According to the target set, population growth rate was to be brought down from 2.9 to 2.7 percent, the target was achieved. 



According to the expert's overall performance of the Plan was unsatisfactory. 



 



Natural Resources: Conservation and Development 



Resource is simply defined as a "mean of comfort or help; something one turns to when one is in need or difficulty". Incidentally, human population itself makes a part of the resources and in modern economics these are studied under the title of 'human resources'. Following table depicts different kinds of resources. 



Natural resources play a key role in the development of a country. Evaluated on the basis of explored mineral resources, Pakistan is a backward country. Due attention was not paid to the exploration of the natural resources in the past. Only one percent of the national income was earmarked in our budgets for mineral development and research. This is an extremely meagre amount when compared with the developed countries but this does not mean that the land of Pakistan has poor natural resources. In fact we have not yet been able to explore and exploit our mineral wealth properly. The Quaid-e-Azam once said that Providence has endowed Pakistan with abundant resources; it was for the people now to explore and exploit these resources to their benefit. This was not an easy task; it demanded honesty and tireless labour. 



Economical and modest use of the available resources and protecting these resources from going waste is a matter which is by no means less important than exploration itself. For this a term "Conservation of Resources" is used. Human population is growing day by day, and with this, available resources are falling short of human needs. Natural resources are the common heritage of humanity, if we squander them; we squander them at the cot of our coming generations. 



Economic experts of the modern age predict that the Third Great War will be fought for water. Hazrat Muhammad Rasool Ullah once said that one should not waste water even if he is making ablution (wuzoo) from a canal full of water. Hazrat Muhammad Rasool Ullah actually wanted to impress upon us that the natural resources are nobody's personal property; nobody has a right to misuse them. The only course open for a grateful man is to take the bare minimum share for him or herself from the dainties of Allah and leave the rest for the rest of humanity. 



 



Health and Education for All 



Human Development Report for the year 2000 has defined Human Development as the process of improving human capabilities for the purpose of enhancing the production of commodities, most desired by the human beings. What are these desired commodities are? Income is certainly one of these, but "income" is not the only thing that matters in human life. The report takes a very realistic view and observes that good health, education, comfortable environment and the freedom of thought and action are the things that matter a lot in human life. These things are now considered to be the basic factors of human development and are more valuable and sustainable than material progress pure and simple. By improving public health we lay the foundations of healthy nation of the future. By educating people we spur an action which flourishes expands; and progresses with the passage of time. 



HDI is a comparatively new concept, the term became popular through the efforts of the United Nations Organization, it stands for Human Development Index, the United Nations Organization has been publishing HDI's on the basis of yearly progress made by all countries of the World on three prounds. 



i. Level of health and average life expectancy. 



ii. Level of literacy (quality and quantity of the level of education acquired by the people). 



iii. Good standards of living (measured on the basis of annual per capita income of the people). 



HDI covered 189 countries of the world during the report year 2003. Pakistan falls on 144th position according to this report. In the preceding year Pakistan was 138th in order. This is unfortunate to note that in 2020 HDI report Pakistan stands at 154th position out of total 189 countries reported. This means that more than 80 percent countries of the world are placed in better standards of education, health and general quality of life, as compared to Pakistan. This analysis is alarming and poses a serious challenge for our policy makers. 



 



 

Aamir Khan

Aamir Khan

Product Designer

Class Sessions

1- Lesson 01: Ideology 2- Lesson 02: Components of the Pakistan Ideology 3- Lesson 03: Pakistan: The Outcome of Sustained Muslim Efforts 4- Lesson 04: The Aligarh Movement 5- Lesson 05: Establishment of the All India Muslim League 6- Lesson 06: The Khilafat Movement: Events and Outcomes 7- Lesson 07: Khilafat Movement: Results and Consequences 8- Lesson 08: The Pakistan Resolution 9- Lesson 09: The Cripps Mission 10- Lesson 10: Election 1945-46 11- Lesson 11: The Cabinet Mission Plan 12- Lesson 12: The Simla Conference 13- Lesson 13: The Third June Plan 14- Lesson 14: Indian Independence Act 15- Lesson 01: Background of Initial Problems 16- Lesson 02: Problems of the New Born State of Pakistan 17- Lesson 03: Accession of the Princely States 18- Lesson 04: Efforts for Resolving the Problems 19- Lesson 05: National Solidarity and Stability 20- Lesson 01: Location 21- Lesson 02: Temperature Zones 22- Lesson 03: Imbalanced Economic Growth and Regional Disparities 23- Lesson 05: Tourist Attractions in Pakistan 24- Lesson 06: Map-Reading 25- Lesson 04: Pakistan's Geo-Strategic Position 26- Lesson 01: The Objectives Resolution 27- Lesson 02: Islamic Provisions of the 1956 Constitution 28- Lesson 03: Islamic Provisions of the 1962 Constitution 29- Lesson04: Islamic Provisions of the 1973 Constitution 30- Lesson 05: Steps towards Islamization (1949-1977) 31- Lesson 06: Steps towards Islamization (Since 1977) 32- Lesson 07: Rights and Responsibilities (Duties) 33- Lesson 08: Human Rights 34- Lesson 09: Fundamental Human Rights Adopted by the UN 35- Lesson 01: Administrative Structure of Pakistan 36- Lesson 02: Organs of the Federal Government and their Functions 37- Lesson 03: Provincial Governments: Their Powers and Functions 38- Lesson 04: Concept of Good Governance in Islam 39- Lesson 01: Culture of Pakistan 40- Lesson 02: Important Ancient Sites of Cultural Significance 41- Lesson 03: Important Buildings of the Muslim Period 42- Lesson 04: Common Characteristics of the Pakistani Culture 43- Lesson 05: Gender Equity: Issues and Problems 44- Lesson 06: Rights of Women in Islam 45- Lesson 07: Policies for Women Participation In Socio-Political Affairs of Pakistan 46- Lesson 01: Languages of Pakistan 47- Lesson 02: CHARACTERISTIC FEATURES OF URDU 48- Lesson 03: Regional Languages of Pakistan 49- Lesson 01: MEANING OF NATIONAL INTEGRATION 50- Lesson 02: Significance of National Integration in an Islamic Democratic State 51- Lesson 03: Problems of National Integration in Pakistan 52- Lesson 01: What is planning? 53- Lesson 02: Economic Planning in the Light of Five Year Plans 54- Lesson 03: Economic Planning in Pakistan: a Bird's Eye View 55- Lesson 01: WHAT IS FOREIGN POLICY? 56- Lesson 02: Factors Determining the Foreign Policy of Pakistan 57- Lesson 03: Pakistan's Foreign Relations with China 58- Lesson 04: Islamic Republic of Pakistan and India 59- Lesson 05: Islamic Republic of Pakistan and Iran 60- Lesson 06: Islamic Republic of Pakistan and Afghanistan 61- Lesson 07: Islamic Republic of Pakistan and Saudi Arabia