Economic planning is one of the distinctive features of the Socialist society.
Economic development is planned so that the economic resources of the state are used not for mere private profit – which means exploitation of man by man which is a denial of the dignity of man – but in the national interest. But, all states with a planned economy are not Socialist states. In many new countries, economic planning is being resorted to in order to develop the national economy and reduce reliance on foreign capital and investment. In this latter category fall the former dependent territories of south-east Asia.
It is customary for the upholders of private enterprise and the system of private profit to denounce state enterprise and economic planning as inefficient. But this is not borne out by the steady economic development of the countries of south-east Asia.
Since liberation from the imperialist yoke, India has gone in for a high degree of economic planning, allied with state control of industry. The national economy is being developed according to a series of Five-Year Plans; the First, 1951-56; the Second, to be published next year with a draft issue next month, 1956-61.
The targets proposed in the Second Five-Year Plan are a 25 percent increase in national income and employment for 10 to 12 million more people. Over the five year, Rs 63,000 million will be invested, two-thirds of it in publicly-owned industries. And what is the record of public ownership in India? Have Indian industries expanded, or are the supporters of private enterprise justified in condemning state control as inefficient? Let us see.
If industrial production in India was 100 in 1946, by the end of 1954 it had risen to 145 (135 at the end of 1953). In 1954, 371 licences were granted to establish or expand industrial undertakings; the 1953 figure had been 182. Over Rs 840 millions were newly invested in 1954 in various economic enterprises.
Already this year the Indian Government has set up Development Councils for the Sugar and Electrical (heavy and light) industries, and a National Industrial Development Corporation which will plan and carry out the establishment of new industries and the development of new lines of production.
Small scale industries also are not forgotten. The Government is contributing to their development, financially as well as organizationally. Only Rs 5 million were allotted to the development of small scale industries in 1952, as against Rs 86 million in 1954. In addition there are the Coir Development Board, the Small Scale Industries Board, and All-India Boards for Handlooms, Silk Handicrafts and Khadi and Village Industries. Under the encouragement of the Handlooms Board, home weavers stepped up production from 1100 million to 1200 million yards from 1952 to 1953. The 1955 target under the First Five Year Plan in 1700 million yards. The Board actively encourages and promotes co-operative effort among handloom weavers.
Already Indian industry has benefited from emancipation. No longer do Indian workers toil for the benefit and enrichment of foreign capitalists. Many, in state-owned industries, are actively working for the direct good of their own country; and further developments are planned.
The West Bengal Government, for example, is to build a coke oven plant, costing Rs 55 million capable of handling 1500 tons of coke a day. There will be many useful by-products. The new major port at Kandla, being built to relieve congestion at Bombay, went into use in April even though it is not yet complete. A new town, Gandhidam, is being built nearby (to resettle displaced persons from West Pakistan) to encourage commercial and industrial activity at Kandla.
The Minister of Communications recently gave figures to show the expansion of his department since Independence. The number of rural post offices has gone up from 18,000 to 41,000; of urban, from 4,000 to 5,500. Every village with a population of over 2,000 now has post office. Smaller villages are grouped into aggregations of 2,000 population to give a shared office. To-day a post office serves half the area and population that it did in 1947.
The present policy is to open a telegraph office wherever there is need. Previously the policy was to open one only where it would show a profit. Long-distance telephone facilities, internal and external, are rapidly increasing. By the end of 1957, the whole telephone system in Calcutta will have been converted to automatic working.
Other former colonial territories which have, since independence, developed enormously are Indonesia, Pakistan and the Philippine Republic. In all three countries, economic planning plays the major role in the industrial development of the state. Pakistan’s Finance Minister, Mr Chanra Mohammed Ali, introducing the Budget on 31.03.55, referred to Pakistan’s conversion, since emancipation, from an agricultural country to a semi-industrial one, with the industries developing to ensure self-sufficiency as far as possible, with its attendant benefit of freedom from external pressure and financial dependence. Pakistan’s industrial output has, in fact, trebled since 1950.
Indonesia and the Philippine Republic each have in hand Five-Year Development Plans, designed to develop particularly agriculture, mining, power and land settlement.