NITI Aayog: Establishment and Purpose

On 13th August 2014, the Modi Government abolished the Planning Commission, a body that had existed for 65 years. This was replaced by a new organization, NITI Aayog (National Institution for Transforming India), officially established on 1st January 2015. However, like its predecessor, NITI Aayog was established by an executive resolution of the Government of India, making it a non-constitutional and non-statutory body. In essence, NITI Aayog serves as the premier policy think tank of the Indian government, focusing on both strategic planning and technical advice for both the central and state governments. NITI Aayog marks a shift from the previous top-down approach of the Planning Commission to a bottom-up model, promoting cooperative federalism by engaging states as equal partners in the policy-making process.

Learning Outcomes:

1. Understanding NITI Aayog’s establishment and role.
2. The rationale behind replacing the Planning Commission.
3. Composition and specialized wings of NITI Aayog.
4. Objectives and guiding principles of NITI Aayog.

Rationale for NITI Aayog’s Formation

When replacing the Planning Commission, the government cited significant changes in India’s political, economic, social, technological, and demographic landscapes over the past six decades. The role of government had also evolved alongside these changes. To address the demands of modern India more effectively, NITI Aayog was envisioned as a more dynamic institution, designed to encourage cooperative federalism, provide domain expertise, and offer a platform for collaboration between different levels of government.

Key aspects of the new institution include:

1. Empowering States: NITI Aayog operationalizes cooperative federalism, treating states as equal partners in national development.
2. Knowledge Hub: It serves as a repository of best practices in governance, offering strategic advice to all levels of government.
3. Collaborative Platform: Facilitates implementation by monitoring progress and bridging gaps between central and state ministries.

Former Finance Minister Arun Jaitley emphasized that the Planning Commission was outdated and unsuitable for India’s diverse and evolving economic landscape. He argued that a “one-size-fits-all” approach no longer worked in today’s competitive global economy, hence the need for a more adaptive model.

Important Note: The Bharatiya approach to development acknowledges India’s unique challenges, rejecting the notion of transplanting foreign models.

Composition of NITI Aayog

The composition of NITI Aayog is as follows:

1. Chairperson: The Prime Minister of India.
2. Governing Council: Includes Chief Ministers of all states, Union Territories with Legislatures, and Lt. Governors of Union Territories.
3. Regional Councils: Formed for specific regional issues, convened by the Prime Minister.
4. Special Invitees: Experts nominated by the Prime Minister with relevant domain expertise.
5. Full-time Organizational Framework:

• Vice-Chairperson: Appointed by the Prime Minister, enjoying the rank of a Cabinet Minister.
• Members: Full-time members with the rank of Minister of State.
• Part-time Members: Maximum of 2 members from academic or research institutions.
• Ex-officio Members: Maximum of 4 Union Council Ministers.
• CEO: Appointed by the Prime Minister in the rank of Secretary to the Government.
• Secretariat: Provided as needed.

Specialized Wings of NITI Aayog

NITI Aayog houses several specialized wings that cater to various governmental needs:

1. Research Wing: Focuses on sectoral expertise as an in-house think tank.
2. Consultancy Wing: A marketplace of experts, matching state and central governments with solution providers.
3. Team India Wing: Ensures every state and ministry has a direct communication channel with NITI Aayog, facilitating collaboration.

Objectives of NITI Aayog

The broad objectives of NITI Aayog are essential for national development:

1. Shared Vision: Evolve a shared vision of development priorities with state involvement.
2. Cooperative Federalism: Strengthen cooperative federalism by ensuring states have a continuous stake in policy-making.
3. Village-Level Plans: Develop mechanisms to formulate plans from the village level upwards.
4. National Security: Ensure that national security concerns are integrated into economic strategy.
5. Inclusive Development: Focus on ensuring that economically marginalized sections of society benefit from development.
6. Strategic Policy Frameworks: Design strategic, long-term policies and monitor their progress.

NITI Aayog is also tasked with monitoring and evaluating programs, building international partnerships, and creating an innovation support system.

Table: Objectives of NITI Aayog Compared to Planning Commission

Through these objectives, NITI Aayog aims to transition the government’s role from a provider to an enabler. It also seeks to leverage India’s middle class, entrepreneurial talent, and the Non-Resident Indian (NRI) community for national growth.

Guiding Principles

NITI Aayog is driven by certain guiding principles:

1. Antyodaya: Prioritize the upliftment of the marginalized.
2. Inclusion: Empower vulnerable sections by addressing inequalities.
3. Village Development: Integrate villages into the development process.
4. Demographic Dividend: Leverage India’s youth through education and skill development.
5. People’s Participation: Transform development into a people-driven process.
6. Good Governance: Promote transparent, accountable governance.
7. Sustainability: Ensure development is sustainable and respects the environment.

Functions of NITI Aayog

The various functions performed by NITI Aayog fall under four main heads:

1. Policy Design: Design and implement policy frameworks for national development.
2. Foster Cooperative Federalism: Ensure state participation in policy-making.
3. Monitoring and Evaluation: Track and assess the progress of national programs.
4. Think Tank: Serve as a knowledge and innovation hub, promoting best practices.

Cooperative Federalism

NITI Aayog plays a vital role in advancing cooperative federalism in India by fostering joint collaboration between the Centre and the States. The key features include:

1. Joint Focus: Both the Centre and States collaborate on the National Development Agenda.
2. Advocacy for States: Represent the perspectives of states in central decision-making.

Initiatives like the Development Support Services to States (DSSS) and Sustainable Action for Transforming Human Capital (SATH) are examples of Centre-State partnerships to improve social and economic indicators.

Criticism

Opposition to the formation of NITI Aayog has been significant. Critics argue that the change from Planning Commission to NITI Aayog is merely cosmetic. Political leaders from the opposition assert that the corporate sector will dominate policy-making under the new structure, leading to potential discrimination against states.

For example, Sitaram Yechury referred to NITI Aayog as “no policy and bad policy“, questioning its effectiveness, while Congress leader Manish Tewari argued that it was an unnecessary restructuring based on principle rather than a legitimate need for reform.

Important Note: Criticism surrounds the shift from an established system (Planning Commission) to a newer model, with concerns about centralization and corporate influence.

Functions of NITI Aayog Verticals

The NITI Aayog is divided into various verticals, each responsible for specific areas of national importance. These include:

1. Agriculture
2. Energy
3. Health
4. Infrastructure
5. Skill Development
6. Women and Child Development
7. Rural Development
8. Public-Private Partnerships
9. Social Justice
10. Natural Resources & Environment

These verticals ensure a coordinated approach to governance, enabling policy interventions across sectors.

Attached Offices

Two significant offices are attached to NITI Aayog:

1. National Institute of Labour Economics Research and Development (NILERD): Formerly IAMR, focuses on human capital research and planning.
2. Development Monitoring and Evaluation Office (DMEO): Monitors and evaluates central government programs to ensure effective implementation.

MCQ:

NITI Aayog was established in

which year?

a) 1950
b) 2000
c) 2014
d) 2015

Correct Answer: d) 2015

In conclusion, NITI Aayog serves as an adaptive, strategic think tank, promoting inclusive development through cooperative federalism and technology-driven governance. Its focus on innovation, collaboration, and long-term planning aims to make India more competitive and resilient in facing the challenges of the 21st century.