How are the principles followed by the NITI Aayog different from those followed by the erstwhile Planning Commission in India? (250 words)

NITI Aayog replaced the Planning Commission in 2015 to shift India from centralised resource allocation towards strategic, cooperative and competitive federalism in a market-oriented economy.

• Planning Commission: centralised Five-Year Plans, top-down target setting and discretionary plan assistance shaped state priorities.
• NITI Aayog: acts as a policy think tank, develops long-term strategy, promotes innovation, monitors outcomes and provides evidence-based advice; it has no power to allocate funds.

The Planning Commission generally followed a Centre-led model in which states negotiated plan size and resources. NITI Aayog’s Governing Council includes Chief Ministers and Lieutenant Governors, enabling consultation, state-specific strategies and bottom-up inputs through district-level planning. Its competitive-federalism tools compare states on health, education, water, innovation and sustainable development.

Earlier planning emphasised physical targets, public-sector investment and input allocation. NITI Aayog stresses measurable outcomes, technology, public-private collaboration, entrepreneurial ecosystems, behavioural change and policy evaluation. It can identify best practices and coordinate across ministries without duplicating implementation departments.

NITI Aayog’s flexibility suits a diverse, liberalised economy, but the absence of financial leverage can weaken state compliance and coordination. Competitive indices may oversimplify capacity differences, and overlapping mandates can blur accountability. It should strengthen independent evaluation, local-government participation, reliable data and predictable fiscal coordination with the Finance Commission.

Keywords: cooperative federalism, competitive federalism, think tank, Five-Year Plans, Governing Council, outcome-based monitoring, decentralisation, policy evaluation.