There are certain necessary pre-requisites for its success as under-mentioned:
1. Central-Planning Authority:
The most significant conditions for the success of planning is the setting of central planning authority.
For instance, in India, there is Planning Commission and in Russia, there is Gosplan. This body carries a group of experts, economists, statisticians, engineers etc. who deal with the different aspects of the economy. They suggest measures for the proper implementation of the plan.
2. Reliable Statistical Data:
A pre-requisite for the sound and successful planning is the availability of reliable, adequate and accurate statistical data relating to various fields of the economy. For obtaining necessary statistical information, a survey of the existing and potential resources has to be undertaken like raw-material, capital, human and natural resources of the country.
3. Specific Objective:
Another imperative condition for the success of economic planning is the specific objective. The prescribed objectives should be definite and laid down in an order of priority keeping in view the urgency of economy’s problems. Moreover, objectives should not be too many in number but should be realistic, mutually compatible, flexible and feasible within means.
4. Fixation of Targets and Priorities:
It is equally necessary to fix the targets and priorities and further capability of their achievement. In other words, those schemes or projects which are required to be executed first, should be given top priority and less significant projects should have low priority. The programmes of priorities should not be much rigid: rather it may be changed according to the requirements of the economy. These targets should be mutually consistent for attaining a particular growth rate for the economy.
5. Suitable Economic Organisation:
For the success of planning there must be suitable economic organisation which promotes but do not hinder the progress of the country. In other words, socialistic economic organisation in which means of production are socialized is a basic condition for the realistic planning in a country. But on the contrary, the experience of capitalistic countries show that private enterprise never promotes planning.
6. Strong and Stable Government:
The success of economic planning also depends on the strong and stable government with a high degree of authority. Planning process is in danger in many underdeveloped countries due to frequent change in their governments. In this matter, India is fortunate enough as it enjoyed considerate political stability during the period of its planning process.
7. Fair and Efficient Administration:
The administrative machinery with a high degree of honesty and efficiency plays very pioneer role in the formulation and implementation of plans. Our country has a bitter experience in this regard. Even the best plans fail due to corrupt, inefficient, inactive and lethargic administration.
In most of the poor and backward countries there is a great paucity of trained and competent administration and technical personnel which is chief constraint in the development of the country. Prof. W.A. Lewis considers a strong competent and incorrupt administration as the first condition for the success of the plan.
8. Mobilization of Resources:
The success of planning, in fact, is based on the proper mobilization of financial resources of the country. In an underdeveloped country, resources are inadequate and irregular, ineffectively developed and mobilized to the required extent.