3rd Five Year Plan
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Chapter 3:


The completion of the Second Five Year Plan in March, 1961, marked also the end of the first decade of India's planned development. During this decade there has been rapid expansion of the Indian economy, the outlines of the country's future social and economic structure have been established, and foundations have been laid for the achievement of the basic objectives and the long-term economic goals set out in the preceding Chapters.

2. The First Five Year Plan took over several projects which had been worked out earlier and integrated them into a well-knit scheme of economic and social development embracing every part of the country. Through its emphasis on agriculture, irrigation, power and transport the Plan aimed at creating the base for more rapid economic and industrial advance in the future. In stressing the place of social change and institutional reforms in the economic development of the country, the Plan initiated some of the basic policies which were further developed under the Second Plan.

The reform of an antiquated land system which was inhibiting agricultural production, setting up a nation-wide agricultural extension service as part of a comprehensive community development programme, revitalisation of the cooperative movement, expansion of irrigation and power facilities on a large scale, strengthening and improving the administrative structure of the country, and establishing a number of specialised institutions for providing credit to agriculture and industry, for developing small scale industries and for giving special assistance to backward sections of the population were some of the notable features of the First Plan. The Plan focus-sed the nation's attention on the vital need for planned effort for achieving rapid economic growth as well as social justice. It offered to the people not only the objectives for which to work, but also the means with which to realise them through mutual self-help and cooperation and the mobilisation of local resources.

3. While the Second Plan carried the basic policies initiated under the First Plan a step further and aimed at a larger increase in investment, production and employment, its main contribution was to direct the economy towards the next important stage which followed logically from the policy of planned development which the country had already accepted. It placed special emphasis on the development of basic and heavy industries for, with the advantages in natural resources which India already possessed, this was an essential element in the strategy for speeding up the development of the national economy over the next 15 or 20 years. The Plan also defined more clearly the key role that the public sector was to play in the economic development of the country. Along with the emphasis that it put on accelerating the rate of growth of the national economy and creating c'onditions for more rapid development in future, the Second Plan placed before the nation the goal of the socialist pattern of society. It also set the objectives of increasing employment opportunities and reducing disparities in income and wealth and bringing about a more even distribution of economic power.

4. As a result of economic planning, there was a substantial increase in the rate of investment, especially in directions calculated to accelerate the economic development of the country. The total investment, public and private, in the economy increased from over Rs. 500 crores per annum at the be'ginning of the First Plan to Rs. 850 crores at its end and reached an annual level of about Rs. 1600 crores at the end of the Second Plan. Corresponding figures for investment by public authorities are about Rs. 200 c'rores, Rs. 450 crores and Rs. 800 crores. Reckoned at current prices, the total investment during the two Plans was Rs. 10,110 crores, Rs. 5210 crores in the public sector and Rs. 4900 crores in the private sector. Details for the two Plans are given below :

Table 1 : Outlay and investment in First and Second Plans*
(Rs. crores)

sector First Plan 1951-56 Second Plan 1956-61 total 1951-61
public sector outlay 1960 4600 6560
Public sector investment 1560 3650 5210
private sector investment** 1800 3100 4900
total investment 3360 6750 10110

*At current prices.
**Private sector investment was shown earlier at Rs. 1600 crores for the First Plan and at Rs. 2400 crores for the Second Plan. These estimates have been revised in the light of fuller information. They exclude transfers from the public sector.

5. The distribution of outlay in the public sector as between different heads of development is shown in the following Table :

Table 2 Distribution of outlay
(Rs. crores)

head. First Plan Second Plan
expenditure percentage expenditure percentage
agriculture and community development . 291 15 530 11
major and medium irrigation 310* 16 420 9
power 260 13 445 10
village and small industries 43 2 175 4
industries and minerals 74 4 900 20
transport and com        
munications . 523 27 1300 28
social services and miscellaneous 459 23 830 18
total 1960 110 4600 100

* Includes flood control.

The changes in distribution of outlay reflect the changes in emphasis in the two Plans. In the First Plan relatively greater stress was placed on programmes designed to build up the agricultural potential of the country. Consequently, programmes for agriculture and irrigation comprised 31 per cent of the Plan outlay. In the Second Plan, greater emphasis was given to industrial development and the relative share of industries and minerals increased from 4 per cent to 20 per cent. Transport and communications were given high priority in both the Plans. Social services and miscellaneous heads comprised 23 per cent of the First Plan outlay and 18 per cent of the Second Plan outlay.


6. The financing of the public sector outlay in the two Plans was as follows :

Table 3 Financial resources in the public sector
(Rs. crores)


First Plan Second Plan
actual percentage estimated percen tage
outlay on the Plan 1960 100 4600 100
internal resources 1772 90 3510@ 76
external assistance 188 10 1090* 24

@ Includes subscriptions to Government loans by (i) Reserve Bank and by (ii) State Bank out of P.L. 480 deposits.
* Includes investment of P.L. 480 fundsin 1960-61 by Reserve Bank in special securities.

During the Second Plan in particular, there was a substantial step-up in the tax effort. A number of new direct and indirect taxes were introduced. The gap in resources was made up partly through deficit financing and partly through external assistance. During the earlier years of the Second Plan, budgetary deficits were rather high. An attempt was, however, made in the later years to reduce them. Actual deficit financing during the Second Plan was roughly of the order of Rs. 948 crores.

7. The balance of payments did not present a problem during the First Plan period. The actual deficit amounted to Rs. 318 crores over the Plan period. It was met to the extent of Rs. 196 crores by external assistance and Rs. 122 crores by withdrawals from the country's foreign exchange reserves. The Second Plan which put greater stress on industrialisation naturally required heavier expenditure of foreign exchange. The Second Plan Report estimated the aggregate deficit in the balance of payments over the five-year period at about Rs. 1100 crores and assumed that about Rs. 800 crores out of this would be met by external assistance. The Plan ran, however, into unexpected balance of payments difficulties from the very start and had to be reappraised in 1958. Stringent restrictions had to be imposed on less essential imports. Foreign exchange reserves had to be drawn down by Rs. 600 crores in the Second Plan period. In addition, external assistance of the order of Rs. 872 crores was utilised in the public as well as private sectors, besides commodity imports of Rs. 534 crores under the P.L. 480 assistance and net drawals from the International Monetary Fund of the order of Rs. 55 crores.

8. The record of growth over the last ten years has not been uniform. There have been significant ups and downs—occasionally due to natural causes or international developments and sometimes due to deficiencies in implementation. During the First Plan, owing largely to the progress recorded by agricultural production, the national income increased by 18 per cent as against a target of 12 per cent. During the Second Plan, on the other hand, the increase in national income was 20 per cent as against a target of 25 per cent.

9. Taking the decade as a whole, however, the picture is one of overall progress. Basic facilities like irrigation, power and transport which are essential for agricultural and industrial development have been greatly expanded. Valuable mineral deposits have been opened up to feed industries, small and large. A number of projects have been completed in spite of delays caused chiefly by the foreign exchange crisis and have either already come into production or will do so in the immediate years ahead. Agricultural production has expanded by about 41 per cent and output of foodgrains by 46 per cent. The net output of organised manufacturing industries has nearly doubled. The share of the public sector industries in it has gone up from 1.5 per cent to 8.4 per cent and much of this increase has been in key industries like steel, coal mining and heavy chemicals. This has been accompanied by a large expansion of electric power generating capacity and considerable improvement in the expansion of the country's transport and communications system, mainly in the public sector. There has been a general expansion of organised industries and the paid up capital of companies at work has more than doubled. At the same time, there has been also substantial development in village and small industries. Facilities for education and technical training have become much more widespread than before. The number of hospitals and dispensaries has significantly increased, special measures have been taken to eradicate malaria, and there has been a general improvement in health conditions, resulting in substantial increase in the survival rate. The increase in national income has been 42 per cent over the last decade ; but, owing to the increase in population, the increase in income per capita has been 16 per cent.

10. A general view of the growth of the economy over the last decade may be obtained from the selected indicators given in the Table below and the data set out more fully in An-nexure I to Chapter V.

Table 4 Selected indicators of growth

item unit 1950-51 1955-56 1960-61 percentage increase
in 1960-61 over 1950-51
national income at 1960-61 prices Rs. crores 10240 12130 14500 42
population millions 361 397 438 21
per capita income at 1960-61 prices Rs. 284 306 330 16
index of agricultural production 1949-50=100 96 117 135 41
foodgrains production million tons 52.2* 65.8* 76.0 46
nitrogenous fertilisers consumed 000 tons of N 55 105 230 318
area irrigated (net total) million acres 51.5 56.2 70.0 36
cooperative movement          
advances to farmers Rs. crores 22.9 49.6 200.0 773
index of industrial production 1950-51=100 ;00 139 194 94
production of steel ingots million tons 1.4 1.7 3.5 150
aluminium 000 tons 3.7 7.3 18.5 400
machine tools (graded) value in Rs. crores 0.34 0.78 5.5 1518
sulphuric acid 000 tons 99 164 363 267
petrolium products million tons   3.6 5.7  
mill-made million yards 3720 5102 5127 38
Khadi, handloom and powcrloom million yards 897 1773 2349 162
total million yards 4617 6875 7476 62
minerals :          
iron ore million tons 3.2 4.3 10.7 234
coal million tons 32.3 38.4 54.6 69
exports Rs. crores 624 609 645 3
power : installed capaciy million kW 2.3# 3.4# 5.7 148
railways : freight carried .... million tons 91.5 114.0 154.0 68
roads : surfaced including national highways 000 miles 97.5 122.0 144.0 48
commercial vehicles on road 000 numbers 116 166 210 81
shipping lakh GRT 3.9 4.8 9.0 131
general education :          
students in schools million numbers 23.5 31.3 43.5 85
technical education : engineering and technology— degree level—intake 000 numbers 4.1 5.9 13.9 239
health : hospital beds 000 numbers 113 125 186 65
doctors (practising) 000 numbers 56 65 70 25
consumption levels : food calories per capita per day 1800 1950 2100 17
cloth yards per capita per annum 9.2 15.5 15.5 68

* Estimates of production adjusted for changes in statistical average and methods of estimation upto 1956-57. # Figures relate to calendar years, 1950 and 1955.

The progress achieved in different sectors of the economy is briefly reviewed below :


11. The trend of agricultural production since 1949-50 is shown in the following Table :

Table 5 Index number of agricultural production

Group ] 1950-51 1955-56 1960-61
all crops 96 117 135
food crops 91 115 132
other crops 106 120 142

In spite of fluctuations from year to year, there was unmistakable evidence of expansion. The cumulative rate of growth was about 3.5 per cent per annum and was much higher than in any previous decade. The average level of food-grains production of about 50 million tons in the preceding decade was exceeded early in the First Plan and amounted to over 76* million tons in 1960-61 as against 57.6 million tons in 1949.50 and 52.2 million tons in 1950-51. The yield per acre also rose significantly over the decade. The average yield of rice per acre, for example, increased from 694 Ib in the quinquennium 1946-47 to 1950-51 to 727 Ib during the First Plan period and 807 Ib in the Second Plan period. The increase in production of major agricultural commodities has been as follows:

Table 6 Production of major crops

crop unit 1950-51 1955- 56 1960-61
foodgrains (cereals and pulses) million tons 52.2 65.8 76.0
oilseeds million ions 5.1 5.6 7.1
sugercane (gur) million tons 5.6 6.0 8.0
cotton million bales 2.9 4.0 5.1
jute million hales 3.3 4.2 4.0

12. The total outlay on agriculture, community development and irrigation amounted to Rs. 1551 crores during the decade. The principal agricultural production programmes undertaken related to extension of irrigation, supply of chemical fertilisers, development of local manurial resources, multiplication and distribution of improved seeds, adoption of improved agricultural practices and land reclamation and development.

13. The net area irrigated is estimated to have increased from 51.5 million acres in 1950-51 to about 70 million acres in 1960-61. The major and medium irrigation projects started in the First and Second Plans, are expected to create potential for irrigation of about 38 million acres on full development. About 4 million acres were reclaimed by the end of 1960-61. Mechanical cultivation was extended to 0.5 million acres and land improvement to about 1.5 million acres. About 4000 seed farms were estabished under a scheme to cover the entire cultivated area of the country with improved seeds. The consumption of nitrogenous fertilisers (in terms of N) increased from 55,000 tons to 230,000 tons and of phosphatic fertilisers (in terms of P2,05) from 7000 tons to 70,000 tons between 1950-51 and 1960-61. Attention was also given to the development of urban compost and local manurial resources. By the end of the Second Plan 11.8 million acres were estimated to have been brought under green manuring. About 2.7 million acres were covered by soil conservation measures. Measures were also taken for the development of livestock and fisheries, milk supply, vegetable and fruit cultivation and afforestation. For example, production of milk went up from 17 million tons to 22 million tons and of fish from 0.7 million tons to 1.4 million tons. Afforestation programmes covered about 0.5 million acres.

14. Besides the formulation and implementation of programmes for development, the First and Second Plans also envisaged a reorganisation of the agrarian structure. Measures in this direction consisted of the abolition of intermediaries (such as zamindars and jagirdars), protection and improvement of tenancy rights and the imposition of ceilings on land holdings. Efforts were also made in several States to encourage consolidation of holdings. The programme for ameliorating the economic condition of agricultural labourers included settlement on fallow and reclaimed lands and fixation of statutory minimum wages.

15. Among the most significant developments in the agrarian economy during the past decade, mention may be made of the introduction of the extension services throughout the country as an integral part of the community development movement and democratic decentralisation of rural development work. At the end of the Second Plan the community development movement covered about 370,000 villages and well over half of the country's rural population. About 60,000 village level workers and technical officers were given special training in extension work. To carry this programme further and make it more effective, responsibility for development is being transferred to people's institutions at and below the district level, so as to secure complete involvement of the people both in the formulation and implementation of development programmes. The village would constitute the primary unit and the responsibility and initiative for social and economic development at the village level would be placed fully on the village panchayat and the village cooperative. The cooperative movement has made considerable progress during the last decade. By the end of the Second Plan, there were 210,000 primary agricultural societies—almost double the number in 1950-51. About 1870 cooperative marketing societies and 41 cooperative sugar factories were set up. A number of useful experiments were initiated in cooperative farming and a National Cooperative Farming Advisory Board was established to promote the growth of cooperative farming.

*Latest estimates indicate that foodgrains production in 1960-61 may be over 78 million ions.


16. The past decade has witnessed striking development in industry—in terms of the rate as well as the pattern of industrial growth. Some idea of the trend may be obtained from the following indices of industrial production :

Table 7 : Index number of industrial production*

group 1955-56 1960-61
general index 139 194
cotton textiles 128 133
iron and steel 122 238
machinery (all types) 192 503
chemicals 179 288

*This index is the same as the Official index except that the comparisonlbaselhasbeen changed from the calendar year 1951 to the financial year 1950-51 so as to facilitate measurement of growth over the plan period,

17. The index number of industrial production thus recorded a cumulative rate of expansion of about 7 per cent per annum. The actual increase was, in fact, more pronounced than indicated by the above figures, because a number of new industries which have generally shown more marked progress, are at present not adequately provided for in the index.

18. Even more significant than the quantum of industrial development has been the direction in which the expansion has taken place, especially under the Second Plan. During the First Plan period what had been initially proposed for large industry was chiefly to encourage the already existing factories to use their capacity to the full. Industrial production, even with this mild stimulation, rose by 39 per cent during the quinquennium.

19. With the successful completion of the First Plan, it was possible to take up in a large way the development of new industries, especially the capital and producer goods industries, which constitute the basis for any programme for accelerated industrial growth. Judging by the progress so far achieved by the metallurgical, mechanical and electrical engineering and chemical industries in augmenting industrial potential and taking cognisance of the heavy machine- building projects recently initiated, it can be stated that some of the basic conditions required for an accelerated growth towards the 'goal of a self-reliant economy have been successfully established over the last decade.

20. A key role was assigned to the public sector in the development of basic and heavy industries. Total public sector outlay on industries and minerals amounted to Rs. 974 crores over the decade. Investment in the Second Plan period alone amounted to as much as Rs. 870 crores in the public sector or 56 per cent of the total investment in organised industry, public and private. What is more important, most of the public sector industries were of a heavy or basic type. This development has not only helped to strengthen the public sector, but also to create conditions conducive to a rapid growth of medium and light industries in the private sector.

21. A major step forward was taken with the establishment of three new steel plants in the public sector and the expansion of the two units in the private sector. The new projects have now reached the stage of production and the output of steel ingots has increased from 1.4 million tons in 1950-51 to 3.5 million tons in 1960-61 and of pig iron from 3.5 lakh tons to 9 lakh tons. The availability of other essential industrial materials like aluminium, cement, heavy chemicals and dyestuffs, of fuels such as coal and petroleum, and of power has also increased substantially since 1950-51.

22. Another significant development has been the rapid growth of machine-building industries. India is now producing progressively increasing quantities of machine tools and machinery for use in agriculture and transport and for such industries as chemicals and pharmaceuticals, textiles, jute, cement, tea, sugar, flour and oil mills, paper, mining etc. Indigenous manufacturing capacity now exists for most of the machinery and equipment needed by the railways, except diesel and electric locomotives. A large variety of electrical equipment and scientific instruments are also now being produced in the country. The value of graded machine tools produced in the country has increased from Rs. 34 lakhs in 1950-51 to Rs. 550 lakhs in 1960-61. Steps have been recently taken for the establishment of a heavy machine-building plant and the foundry/forge plant at Ranchi and the coal mining machinery plant at Durgapur. The aggregate value of the various kinds of industrial machinery and capital goods was eleven times as much as at the beginning of the decade. The Heavy Electrical Project at Bhopal has entered the stage of initial production. When all stages are completed Rs. 25 crores worth of equipment will be produced.

23. The progress made by chemical industries, particularly pharmaceuticals, heavy chemicals and fertilisers, has also been signific'ant and capacity of production for a wide range of primary organic chemicals has been stepped up.

24. Modernisation and re-equipment of important industries, such as jute, cotton textiles and sugar have made progress. In the case of the jute industry, the programme is at an advanced stage on the spinning side. The bulk of the machinery required for the modernisation of the jute industry in the preparatory and spinning departments has been manufactured within the country.

25. Another achievement during the period under review was the progress made in increasing the indigenous content of industrial products manufactured in the country. Yet another indicator of the country's industrial development is the production of a growing number of new industrial items e.g. industrial boilers, milling machines and other types of machine tools, tractors, industrial explosives, sulpha and antibiotic drugs, D.D.T., newsprint, motor-cycles and scooters, calcium carbide, dyestuffs, staple fibres, etc.

26. There has been also considerable progress in consumer industries. The production of older industries like textiles and sugar recorded substantial expansion yet more rapid progress was made in industries manufacturing durable items such as automobiles, bicycles, motor-cycles, scooters, fans, radios, electric lamps and sewing machines.

27. The follov/ing Table gives some idea of the progress made in the production of important producer and consumer goods during the last decade :

Table 8 Production in selected industries

item unit 1950-51 1960-61
s'eel ingots million tons 1 -4 3.5
aluminium 000 tons 3-7 18-5
diesel engines 000 numbers 55 40
electric cables (ACSR      
conductors) 000 tons 1-7 22-0
nitrogenous fertilisers (in      
terms of N) 000 tons 9 110
phosphatic fertilisers (in      
terms of P2 05) 000 tons 9 55
sulphuric acid 000 tons 99 363
cement million tons 2-7 8-5
cotton textiles (mill-made) million yards 3720 5127
sugar* million tons 1 -1 3-0
paper and paper board 000 tons 14 350
bicycle ''organised sector only) 000 numbeis 101 1050
automobiles 000 numbers 16-5 53-5

* Relates to crop year, November-October.


28. Another notable feature of the period under review was the attention given to mineral exploitation and production. The organisations for the exploration, assessment and exploitation of the country's mineral resources were considerably strengthened. The principal minerals in respect of which more successful exploitation and production were recorded were coal, iron ore and bauxite. The production of coal increased from 32.3 million tons in 1950-51 to 54.6 million tons in 1960-61 and of bauxite from 64,000 tons in 1950 to 377,000 tons in 1960. Most of these increases took place in the Second Plan period.

29. While the output of mineral oil within the country is as yet small, valuable oil resources have been found in Nahorkatiya area in Assam and indicators obtained of a sizeable oil field in Cambay-Ankleshwar area in Gujarat. Prospecting operations are in progress in other areas as well. In view of the importance of establishing indigenous sources of oil, an Oil and Natural Gas Commission was set up for undertaking, on an intensified scale, geological surveys, geophysical investigations and exploratory drilling for oil. Construction of two refineries at Nunmati and Barauni was taken up in the public sector and the Indian Oil Company, a Government agency for the distribution of oil products, was formed in 1959.


30. The development of village and small industries as an integral element in an expanding national economy has been from the beginning, one of the key programmes under the Five Year Plans. They were expected to lead to fuller use of local resources, meet a significant part of the expanding demand for consumer goods, form a vital link between agriculture and large-scale industries, and provide increasing opportunities for employment—both in rural and in urban areas. During the last decade, Rs. 218 crores have been spent by Government for the development of these industries. All-India Boards were set up with a view to formulating, guiding and, to an extent, implementing co-ordinated programmes for the development of small scale industries, handloom industry, khadi and village industries, handicrafts, coir and sericulture. An industrial extension service was developed and Small Industries Service Institutes were set up in every State and 53 Extension Centres were also established. About 60 industrial estates comprising over 1000 small factories using power were established. Special arrangements were made for the provision of credit, technical advice and raw materials and the supply of imported and indigenous machines on hire-purchase terms. The growth of a vigorous class of small entrepreneurs was a significant development of the last ten years. In a number of industries, notably, machine tools, sewing machines, electric motors and fans, bicycles, builders' hardware and hand tools, there have been increases in production varying from 25 to 50 per cent during the last five years. Production would have been much larger but for the shortage of some basic raw materials HI.;-.- steel and non-ferrous metals. Among the traditional industries, which provide considerable employment, the production of hand-loom cloth increased from 742 million yards to about 1900 million yards, of khadi from 7.3 million yards to 74 million yards and of raw silk from about 2.5 million Ib to 3.6 million Ib between 1950-51 and 1960-61. Steps were taken during this period to introduce a scheme for enlarging credit facilities for small scale industries from banking agencies by providing Government guarantee, to assist weavers' cooperatives to purchase powerlooms and to manufacture and distribute an improved type of spinning wheel (Ambar charkha).


31. Provision of adequate power is one of the basic requirements for the development of both large and small scale industries. A number of hydro-electric and thermal power projects were constructed during this period and the total public sector investment in power amounted to Rs. 705 crores. The four multi-purpose projects, Damodar Valley, Bhakra-Nangal, Tungabhadra and Hirakud, which were begun before the First Plan, were indorporated in the integrated programme of river valley development. Among the river valley projects started during the last decade, mention may be made of Chambal, Riband, Koyna and Nagarjunasagar. A large programme for thermal power generation was also undertaken. The installed capacity of hydroelectric power increased from 0.56 million kW to 1.93 million kW and of thermal power from 1.74 million kW to 3.77 million kW during the last decade. The total installed capacity thus rose from 2.3 million kW in 1950 to 5.7 million kW in 1960-61. Impressive as this increase was, it fell substantially short of the target of 6.9 million kW. The shortfall is mainly due to foreign exchange difficulties that arose during the early years of the Second Plan and also delays in the execution of some of the major projects. Special attention was paid to extending electricity to rural areas as this was considered to be an important measure for developing and modernising the rural economy. The total number of towns and villages electrified went up from 3687 in 1950-51 to 23,000 in 1960-61.


32. Considerable improvement and expansion of the country's transport system took place during the past decade the total public sector outlay was Rs. 1823 crores. The main task under, the First Plan was the rehabilitation and replacement of rolling stock and fixed assets of the railways which had been subjected to severe strain on account of the War and the Partition. To meet the growing demands of the agricultural and industrial sectors, additional facilities were provided by increasing rolling stock and constructing new lines during the Second Plan. There was also substantial expansion in road transport, shipping and air services. An idea of the development of the transport services during the last decade may be obtained from the following Table :

Table 9 Transport

items unit 1950-51 1955-56 1960-61
new lines added miles   380* 800*
rolling stock        
locomotives 000 numbers 8.5 9.2 10.6
coaches 000 numbers 20.5 23.2 28.2
wagons 000 numbers 222.4 268.5 341.0
passenger miles billions 41.3 38.8 48.6
freight carried million tons 91.5 114.0 154.0
surfaced including national highways 000 miles 97.5 122.0 144.0
unsurfaeed 000 miles 151.0 195.0 250.0
road transport        
commercial vehicles on road 000 numbers 116 166 210
tonnage lakh CRT 3.9 4.8 9.0
major ports        
capacity million tons 20 25 37

* Relates to the quinquennium ending 1955-56 and 1960-61 respectively.

33. The expansion of industrial and commercial activity had its impact on the demand for communication facilities. The number of postal articles handled increased by about 80 per cent and of trunk telephone calls by about fivefold between 1950-51 and 1960-61. The number of post offices increased from 36,000 to 77,000 and of telephones from 168,000 to 460,000. Appreciable progress was also achieved in broadcasting. Each language area was provided with one transmitting station and there were as many as 28 stations in 1960-61. A programme for the provision of community listening sets in rural areas was taken up. The number of radio licences increased by about fourfold during the period.


34. The development of the human resources of the country through the provision of facilities for education, health and social welfare is one of the major objectives of planned development. In the First as well as the Second Five Year Plans, considerable importance was attached to social services and altogether Rs. 1289 crores were spent for their development during the decade, but undoubtedly the needs to be met were much larger.

35. Education.—There was all-round development of education. The number of students in schools increased from 23.5 million in 1950-51 to as many as 43.5 million in 1960-61—an increase of 85 per cent. The proportion of children attending schools in the age group 6—11 increased from 42.6 per cent to 61.1 per cent and in the age group 11—14 from 12.7 per cent to 22.8 per cent. The number of primary schools increased from 210,000 to 342,000 while that of high and higher secondary schools from 7300 to 17,000. The number of universities increased from 27 to 46 and of colleges (excluding intermediate colleges) from 542 to 1050.

36. Special emphasis was placed on developing facilities for technical education which is the very basis of industrial development. Facilities in existing institutions were expanded and improved and 51 new degree colleges and 110 polytechnics were opened during the last ten years. The total intake of students in these institutions increased from 10,000 in 1950-51 to 39,400 in 1960-61. The outturn of engineering graduates increased by about three times and that of diploma holders expanded more than threefold. Technical training facilities were provided in a number of industrial establishments in the public sector, particularly, in the steel and electrical plants. Special training facilities were also provided for various small scale industries. The annual intake of agriculture and veterinary colleges increased about fourfold.

37. Scientific research.—The promotion of scientific and technological research was given a high priority and a large number of new research institutions was established. These include 20 national laboratories and 3 regional research centres. Notable progress was made in basic and applied research in nuclear science and the peaceful uses of atomic energy, and a strong scientific and technical organisation was built up, which enabled the design and development of instruments and plants required for this work without foreign technical consultancy. The research departments of unversities were also strengthened considerably.

38. Health.—There was a considerable expansion of health services. A large number of new hospitals, dispensaries, health units and maternity and child welfare centres were opened and special programmes for water supply and sanitation, control of communicable diseases and expansion of training facilities were undertaken. In 1950-51, there were 8600 medical institutions with about 113,000 beds. In 1960-61, the number increased to 12,600 institutions with 185,600 beds. In addition, 2800 primary health centres were opened. The number of medical colleges increased from 30 to 57 and that of doctors in practice or in service increased from 56,000 to 70,000. The entire population was covered by the malaria eradication programme. As a result of all these measures, the average expectation of life at birth improved by about 10 years over the last decade.

39. Early in the First Plan, the promotion of family planning was adopted as a public policy and by 1960-61 there were 549 urban centres and 1100 rural centres engaged in family planning service. A number of non-official organisations engaged in family planning work were given special financial and technical assistance. The programme, however, is a most difficult one to carry out and raises problems of great complexity. Sustained and intensive efforts are required over a fairly long period before family planning can become a popular movement and a part of the accepted attitudes of the people generally.

40. Housing.—As a result of the growth of population as also accelerated rate of urbanisation and industrial development, the housing problem became increasingly difficult. Certain measures were taken for slum clearance and improvement and for providing housing facilities for industrial workers and low-income groups. A small beginning was also made to deal with the problem of rural housing. However, the resources that could be spared for this purpose were small compared to the magnitude of the problem. The impact so far has been negligible and the problem of housing, especially in urban areas, is causing concern.

41. Welfare of backward classes.—Special welfare programmes were undertaken for scheduled tribes, Harijans and other backward classes. An area of 3.6 million acres of land was allotted to members of scheduled castes and scheduled tribes and another 2.6 million acres allotted to other backward classes during the period. About 68,000 post-matric scholarships were awarded to students of these classes. Members of these classes who faced special difficulties were helped, through financial assistance, educational facilities and employment opportunities, to improve their social and economic position and get fully integrated with the rest of the community.

42. Rehabilitation.—After Partition about 8.9 million displaced persons migrated into India, 4.7 million from West Pakistan and the rest from East Pakistan. Their relief and rehabilitation was a major undertaking during the First and Second Plans. Outlay on rehabilitation before the First Plan amounted to about Rs. 71 crores. The total expenditure on rehabilitation under the two Plans amounted to about Rs. 168 crores. Of this about Rs. 71 crores was incurred on housing, Rs. 31 crores on education and vocational training, Rs. 29 crores on rural loans for agricultural purposes and Rs. 11 crores on urban loans for small industries, trade and business and the balance on miscellaneous schemes. A large number of townships and colonies was established by Government for settling displaced persons and over 7 lakhs of residential units were constructed either by Government or by the displaced persons with Government assistance. Development of the Danda-karanya area for the re-settlement of displaced agriculturist families from East Pakistan was also initiated during the Second Plan period.

43. Employment.—During the ten years 1951-61, population increased by 77 million. This factor has accentuated the problem of unemployment. The additional employment opportunities created during the Second Plan are estimated at about 8 million, of which 6.5 million were outside agriculture. At the end of the Second Plan, the backlog of unemployment is estimated at about 9 million.

44. From the account given above, it wi!l be seen that over the past ten years, the country has made considerable progress in every branch of national life. Inevitably, it has experienced, at the same time, stresses and strains; these are the growth pains of an economy struggling to find its way out of deep-rooted poverty and the economic stagnation of decades. In every direction new ground has been broken and valuable experience gained. Doubtless, there have been failures and errors that might have been avoided. There are many weaknesses in the economic and social structure that still persist. The country's potential for development is far from being realised. Yet, all these are part of an inspiring period in the nation's history—a story of continuous endeavour reaching into the far corners of the land and drawing within its fold all sections of the people.

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