Revision summary
NITI Aayog replaced the Planning Commission on 1 January 2015. Reasons were centralised Plan funds, weak State voice, and a liberalised economy. Objectives are cooperative federalism, bottom-up policy, innovation, and SDGs. Functions are advice, evaluation, and dashboards—not replacing the Budget or Finance Commission. June 2019 reconstitution kept the PM as Chair and refreshed Vice-Chair, CEO, ministers, and invitees.
Model answer
Introduction
NITI Aayog (National Institution for Transforming India) replaced the Planning Commission from 1 January 2015 as the Union’s premier policy think tank. An answer must show why a federal, competitive-era State no longer wanted five-year Plan allocations from Yojana Bhavan, what NITI is asked to do, and how the body was reconstituted after the 2019 general election.
Body
Reasons for creation
- The Planning Commission had become a centralised allocator of Plan funds, often accused of one-size targets and of sitting above elected Chief Ministers.
- Liberalisation, GST-bound fiscal federalism, and the end of licence-permit planning made a 1950s Commission a poor fit for cooperative and competitive federalism.
- The Union wanted a knowledge hub that could design indices, evaluate schemes, and convene States, not a parallel finance ministry.
Objectives
- To foster cooperative federalism through a Governing Council of the Prime Minister, Chief Ministers, and Lieutenant Governors.
- To replace top-down Plans with bottom-up, village-and-district evidence and with national agendas that States help write.
- To be a platform for innovation, entrepreneurial support, and the Sustainable Development Goals inside Indian ministries.
Functions
- Policy advice to the Centre and States; strategy papers; monitoring of flagship schemes; and knowledge partnerships.
- Aspirational Districts, SDG India Index, Health and Innovation indices, and mission-style work on energy, health, and digital public goods illustrate the think-tank-plus-dashboard role.
- It does not replace the Finance Commission or the Union Budget: money still moves through Finance and line ministries.
Recently reorganised NITI Aayog
- After the 2019 election the Union reconstituted NITI Aayog in June 2019: the Prime Minister remained Chairperson; Dr Rajiv Kumar continued as Vice-Chairperson; Amitabh Kant as Chief Executive Officer.
- Full-time members included specialists such as Dr Ramesh Chand and Dr V.K. Paul; part-time members come from universities and institutes.
- Ex-officio members were senior Cabinet ministers (Defence, Home, Finance, Agriculture in the 2019 list); special invitees included other Union ministers for roads, commerce, and social justice.
- Reorganisation therefore refreshed political membership around the new Cabinet while keeping the 2015 think-tank design: Governing Council, Regional Councils, and a CEO-led secretariat—not a return to Plan-fund federalism.
Flow diagram
flowchart TD PC[Planning Commission ended 2014] --> N[NITI Aayog 2015] N --> G[Governing Council PM CMs] N --> F[Think tank indices missions] R[June 2019 reconstitution] --> N
Conclusion
NITI Aayog exists because the Planning Commission’s allocator model clashed with post-1991 federal politics. Its objectives and functions are advice, indices, and cooperative forums, not Five-Year Plan cheques. The 2019 reconstitution updated ministers and invitees around that same design.
Quick related
Students also ask
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What are the main issues related to poverty and hunger?
Next question in the 2018 paper (Q15). View answer →
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Does NITI Aayog give States their annual Plan money?
No. That Planning Commission function ended. Transfers now run through Finance Commission awards, Union schemes, and the Budget.
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What was ‘reorganised’ in 2019?
Political and expert membership after the new government—Vice-Chair, CEO, full-time members, ex-officio ministers, and special invitees—not a new statute replacing the 2015 resolution.
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