Some of the major drawbacks found in Indian Economic Plans are: 1. Unrealistic Plans, 2. Lack of Pragmatic Approach 3. Faulty Implementation 4. Over-Ambitious Plans 5. Natural Constraints 6. Rapid Growth of Population 7. Incoordination.
Drawback # 1. Unrealistic Plans:
The foremost drawback of Indian plans is that they are based on such assumptions which are invariably inaccurate.
For instance, assumptions of capital output ratio, rate of growth etc. all are over optimistic.
Again, estimates regarding the raising of financial resources from taxation and public borrowing have always proved wrong.
Drawback # 2. Lack of Pragmatic Approach:
Another shortcoming is that planning lacks the practical outlook. This has been formulated on the basis certain ideologies rather than keeping in view the actual problems facing the country. Each plan document contains the same hopes and aspirations. There is no hesitation to say that probably most of the time has been devoted to coin new phrases and slogans to attract the common masses than solving the various acute problems faced by the country.
Drawback # 3. Faulty Implementation:
Faulty implementation of various plans is one of the major obstruction in the path of its success. To Sixth Five Year Plan, the deficiencies in implementation are largely due to inadequate planning of projects at the initial stages. It causes slippages in schedule and poor performance. There are other factors which have been identified for the faulty implementation of plans.
Drawback # 4. Over-Ambitious Plans:
One of the reasons of failure of Five Year Plans is of unduly over ambition. Our plans have multiplicity of objectives. The planners never bothered about the fact that we neither have the adequate financial resources nor the requisite administrative capacity to implement such huge plans.
However, plans have been made just to accommodate the promises made by politicians to their electorate. This has resulted in somewhat a contradiction in target setting on one side and instrument of decision making on the other side.
Drawback # 5. Natural Constraints:
For the slow growth of Indian plans, natural factors are equally responsible. Despite our stern efforts made in agricultural sector, it still remains dependent on monsoon. Similarly, droughts and famines during the period of successive plans have added fuel to the fire by making adverse effect on the economy.
Drawback # 6. Rapid Growth of Population:
Rapid growth rate of population is also another retarding factor in the smooth working of the Five Year Plans. Consequently, most of the resources are utilised only for basic needs of the growing population and only a smaller portion is left for development activities. In this way, population is greatly responsible for slowing the pace of economic development during plan periods.
Drawback # 7. Incoordination:
There is also incoordination among central and state governments which is largely responsible for failure of plans. Moreover, private sector and public sector do not see eye to eye to each other.
The working groups are overwhelmingly dominated by bureaucrats while a sizable part of the economy is associated in the hands of private sector. Therefore, it is not surprising, both sectors lack in co-ordination which results in failure of achieving certain objectives within a limited time period.