NITI Aayog

The concept of a planned economy in India originated in the 1930s, influenced by the socialist philosophy. Over the years, significant developments were implemented to push India’s economy forward.  The current economic planning is managed by the NITI Aayog. Civil Services Aspirants preparing for UPSC CSE exam must be well aware about the objectives, functioning, structure, power and key initiatives of NITI Aayog as question related to it can be asked in UPSC Prelims as well as in GS Paper-3 Economy of UPSC Mains exams.

Table of Content

• What is NITI Aayog?
• Objectives of NITI Aayog
• Structure of NITI Aayog
• Verticals of NITI Aayog
• Specialized Wings in the NITI Aayog
• Guiding Principles of NITI Aayog
• Documents Published by NITI Aayog
• Indices published by NITI Aayog
• Difference between NITI Aayog and Planning Commission
• Key Initiatives of NITI Aayog during 2022-23
• Relevance of NITI Aayog
• Criticisms of NITI Aayog
• Conclusion
• Frequently Asked Questions on NITI Aayog

What is NITI Aayog?

• The National Institution for Transforming India (NITI) Aayog was established in 2015 by replacing Planning Commission. 
• NITI Aayog serves as the apex public policy think tank of the Government of India, and the nodal agency tasked with catalysing economic development in India.
• It is a non-constitutional or extra-constitutional body (i.e., not created by the Constitution) and a non-statutory body (not created by an Act of the Parliament).
• NITI Aayog replaced Planning Commission which was marred by the absence of robust engagement mechanism, lacklustre expertise, failure of making states/UTs answerable for not achieving the targets etc.
• In 2022–23, as India has entered into Amrit Kaal, the 25-year-long leadup to India@100, NITI Aayog has taken a lead to enhance “macro-economic” level growth along with its focus on micro-economic level all-inclusive welfare.
• 7 pillars of NITI Aayog are: Pro-People (2) Pro-Activity (3) Participation (4) Empowering (5) Inclusion of all (6) Equality (7) Transparency.
• Headquarter of NITI Aayog is in New Delhi.

Objectives of NITI Aayog

• To evolve a shared vision of national development priorities with the involvement of States in the light of national objectives.   
• To foster cooperative federalism through structured support initiatives with the States on a continuous basis, recognizing that strong States make a strong nation.
• To develop mechanisms to formulate credible plans at the village level and aggregate these progressively at higher levels of government.
• To ensure, on areas that are specifically referred to it, that the interests of national security are incorporated in economic strategy and policy.
• To pay special attention to the sections of our society that may be at risk of not benefitting adequately from economic progress. 
• To design long term policy frameworks, and monitor their progress. 
• To provide encourage partnerships between key stakeholders and Think Tanks, as well as educational and policy research institutions.
• To create a knowledge, innovation and entrepreneurial support system through a collaborative community of national and international experts, practitioners and other partners.
• To offer a platform for resolution of inter-sectoral and inter-departmental issues in order to accelerate the implementation of the development agenda.
• To maintain a state-of-the-art Resource Centre, be a repository of research on good governance and best practices in sustainable and equitable development as well as help their dissemination to stake-holders. 
• To focus on technology upgradation and capacity building for implementation of programmes.

Structure of NITI Aayog

Below are the members of NITI Aayog:

• Chairman of NITI Aayog: Prime Minister of India (de-facto).
  • In other words, NITI Aayog is headed by Prime Minister of India, who serve as its ex officio chairperson.
• Governing Council of NITI Aayog: Comprises of the Chief Ministers of all States/UTs and the Lieutenant Governors/Administrators of UTs without a legislature.
• Regional Councils of NITI Aayog: These can be constituted to address specific issues which, in the opinion of the Prime Minister, can affect more than one state in a region.
• Features of regional council:
  • Has specified tenures, with the mandate to evolve strategy and oversee implementation.
  • Jointly headed by one of the group Chief Ministers (on a rotational basis or otherwise) and a corresponding Central Minister.
  • Has sectoral central ministers and secretaries concerned, as well as state ministers and secretaries.
  • Is linked with corresponding domain experts and academic institutions.
  • Has a dedicated support cell in the Aayog’s secretariat.
• Full-time Organisational Framework: It has PM as Chairman and:
  • Vice-Chairperson (appointed by the PM).
  • Full time Members
  • Rotational Part-time Members of NITI Aayog: maximum of 2, from leading universities, research organisations and other relevant institutions in an ex-officio capacity.
  • PM nominated Ex-Officio Members of NITI Aayog: maximum of 4 members of the Union Council of Ministers.
  • PM nominated Chief Executive Officer of NITI Aayog:  appointed in the rank of Secretary to the Government of India for a fixed period.
  • Secretariat of NITI Aayog: as deemed necessary
• Special Invitees of NITI Aayog:They are experts, specialists and practitioners having domain knowledge in a particular subject and are nominated by the Prime Minister.

Verticals of NITI Aayog

Administration	Infrastructure-Connectivity
Agriculture and Allied Sectors	Infrastructure-Energy
Aspirational Districts Programme Cell	Micro, Small and Medium Enterprises
Communication and social media Cell	Natural Resources and Environment, and Island Development
Data Management and Analysis, and Frontier Technologies	Project Appraisal and Management Division
Economics and Finance Cell	Public–Private Partnership
Education	Rural Development
Governance and Research	Science and Technology
Governing Council Secretariat and Coordination	Social Justice and Empowerment, and Voluntary Action Cell
Industry-I: Industrial and mineral sector	Social Sector-I: Skill Development, Labour and Employment, and Urban Development
Industry-II: Steel, Textiles, Food processing, Marine products and plantation crops, Capital goods and engineering, Automotives, Circular economy, blue economy	Social Sector-II: Health and Nutrition, and Women and Child Development
State Finances and Coordination	Sustainable Development Goals
Water and Land Resources

NITI Aayog’s activities can be divided into four main heads:

1. Policy and Programme Framework
2. Cooperative and competitive Federalism
3. Monitoring and Evaluation
4. Think Tank, and Knowledge and Innovation Hub

Specialised Wings in the NITI Aayog

• Research Wing: Develops in-house sectoral expertise as a dedicated think tank of top-notch domain experts, specialists and scholars.
• Consultancy Wing: Provides a marketplace of whetted panels of expertise and funding, for Central and state governments to tap into; matching their requirements with solution providers, public and private, national and international.
• Team India Wing: Has representatives from every state and ministry and serves as a permanent platform for national collaboration. Each representative in this Wing.
  • Ensure that every state/ministry has a continuous voice and stake in the Aayog.
  • Establish a direct communication channel between the state/ministry and the Aayog for all development related matters, as the dedicated liaison interface.

Guiding Principles of NITI Aayog

• Antyodaya: Prioritize service and uplift of the poor, marginalized and downtrodden, as enunciated in Pandit Deendayal Upadhyay’s idea of ‘Antyodaya’.
• Inclusion: Empower vulnerable and marginalized sections and redressing identity-based inequalities.
• Village: Integrate villages into the development process.
• Demographic Dividend: Harness greatest asset, the people of India; by focussing on their development, and their empowerment.
• People’s Participation: Transform the developmental process into a people-driven one.
• Governance: Nurture transparent style of governance, transitioning focus from Outlay to Output to Outcome.
• Sustainability: Maintain sustainability, building on India’s ancient tradition of respect for the environment.

Documents Published by NITI Aayog

1. Fifteen-Year Vision: Still being prepared
2. Seven Year Strategy: Still being prepared
3. 3 Year Action Agenda: It was published to recommend policy changes and programmes for action from 2017-18 to 2019-20.

Apart from this, NITI Aayog also publishes various research reports such as report on CCUS Policy Framework in India, Report on Digital Banks etc.

Indices published by NITI Aayog

Below are the indexes of NITI Aayog

• Composite Water Management Index
• District Hospital Index
• Export Preparedness Index
• India Innovation Index
• National Multidimensional Poverty Index
• School Education Quality Index
• SDG India Index
• State Health Index
• State Energy and Climate Index

Difference between NITI Aayog and Planning Commission

	Planning Commission	NITI Aayog
Power to impose policy	Had power to impose policy on states	No power to impose policy on states
power to allocate funds	Had the power to allocate funds to state and central government ministries	Can’t allocate funds (Only finance ministry can allocate)
Role of states	State participated spectators in annual plan meetings	In spirit of cooperative federalism, active participation of states can be seen in decision process
Goals	Set growth targets, goals and strategies	Evolve National Development Strategy
Appointment of Secretaries	Secretaries or member secretaries were appointment through the usual process	Secretaries are known as the CEO and are appointed by the prime minister
Part-time members	Had no provisions for part-time members	Has part-time members depending upon the need
Full-time members	Number of full-time members can be fewer than planning commission	Last planning commission had 8 full time members
Repots to	It reports to National Development Council which had all Chief Minister & Lieutenant Governors.	Governing council has all Chief Minister & Lieutenant Governors.
State Consolations	Consulting states while making policy and deciding on funds allocation	Final policy is made after consultation with state governments
Miscellaneous	Was an executive body	Is also an executive body but can be converted into statutory body by passing a law in parliament

Key Initiatives of NITI Aayog during 2022-23

• Aspirational Districts Programme
• Aspirational Blocks Programme
• National Tele-Mental Health Programme
• Orphan Drugs and Therapies for Rare Diseases
• Reforms in the National Organ Transplant Programme
• National Monetization Pipeline (NMP)
• Production-Linked Incentive (PLI) Scheme
• MISSION LiFE – Lifestyle for Environment
• Inter-ministerial committee on ‘Decriminalizing Non-compliance for Ease of Doing Business in India’

Relevance of NITI Aayog

• Act as ‘enabler’ rather than ‘provider’ of a first and last resort;
• Ambition of leading Indian economy from ‘food security’ to higher production;
• Acts as an ‘Action Tank’ to bring fresh ideas to the government of India;
• Uses urbanization as opportunity for technology inflation;
• Redressal of inequalities of gender bias;
• Improve innovation ecosystem in India such as through The Atal Innovation Mission;
• Acts like a funnel through which innovative and new ideas come from various possible sources such as industry, civil society, academia, or foreign specialists;
• Helps in bring about a greater level of responsibility in the system such as by establishing the Development Monitoring and Evaluation Office which collects performance data of various Ministries on a real-time basis.
• It has launched several indices and started ranking the states in order to promote cleanliness, ease of doing business and other variables of human development.
• Quite successful in educating and making states aware about the importance of promoting economic reforms in the country.
• It published several constructive reports on a variety of sectors to enhance the process of development in the country.
• It smoothened the procedure of budgetary and extra-budgetary financial allocations to states from the Centre.

Criticisms of NITI Aayog

• As it is a non-constitutional body, it is not responsible to parliament.
• UTs are represented byLieutenant Governors and not by chief ministers
• Overfocused on centrally funded programme rather than developmental programmes
• It is said that it does not have influential role in directing, public or private investment as well as in policymaking with long-term consequences.
• NITI Aayog is supposed to be a think tank that maintains a respectable intellectual distance from the government of the day. However, it was noted that NITI Aayog is mainly involved in uncritical praise of government-sponsored schemes.
  • Thus, there is deep concern that NITI Aayog has lost its integrity as an independent institution to guide the government. NITI Aayog must have the ability to independently evaluate the government’s programmes at the Centre and in the States.
• It does not have the power to analyse the performance of various government schemes.

Conclusion

NITI Aayog has significantly impacted India’s economic growth and development. While role of NITI Aayog was instrumental in driving progress, it has also faced criticism regarding its accountability and effectiveness. To maximize its potential, NITI Aayog must address these concerns and continue to evolve as an independent and influential institution, guiding India towards a more prosperous future.

Ref: Source-1

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