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CA Foundation · Business Economics · Indian Economy

The Second Five Year Plan of India, drafted under the Mahalanobis model, gave primary emphasis to which of the following strategies?

The Second Five Year Plan, based on the Mahalanobis model, emphasised rapid growth of capital goods and heavy industries through public sector investment. The idea was that a strong capital goods base would raise long-term growth, rather than relying on consumer goods or exports.

  1. ARapid growth of capital goods and heavy industries through public sector investmentCorrect
  2. BExport promotion through devaluation and trade liberalisation
  3. CPoverty removal through direct employment guarantee schemes
  4. DDecentralised planning with primary focus on consumer goods industries

Explanation

The Mahalanobis two-sector (later four-sector) model argued that long-run growth needs a high share of investment in capital goods. So the Second Plan (1956-61) stressed heavy industry led by the public sector. Export promotion and liberalisation came much later, after 1991.

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