The Three Year Action Agenda

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The draft “Three Year Action Agenda” of the NITI Aayog has been circulated recently to its governing council. This will be finalised after reflecting on the comments and concerns of state governments.

The three year agenda: 

There are two other documents in the pipeline, namely, the seven-year policy strategy and the 15-year long-term vision. The NITI Aayog’s governing council, which is currently reviewing the “Three Year Action Agenda”, comprises all chief ministers, mirroring the erstwhile National Development Council. The “Three Year Action Agenda” seeks to embark on “a path to achieve all-round development of India and its people” through concerted action, outlined in seven parts covering multiple facets of the Indian economy.


  • Given India’s democratic cycle, accountability in a five-year timeline was opaque and diffused. Electoral cycles do not synchronise with five-year plans; quite often, this entailed outcome accountability to rest with a successor government. But a “Three Year Action Agenda” makes the government in office more directly accountable for the implementation of its plans.
  • It gives the government an improved prospect to make corrections and adaptations during its own term in office.
  • Augmenting the “Three Year Action Agenda” with a seven-year implementable policy strategy and a 15-year vision allows adaptation to changing times and exogenous variables — it enables us to look into the future, particularly at evolving technology, demography and ecology, and accordingly align our policies.
  • The 15-year vision is also somewhat coterminous with the Sustainable Development Goals (SDGs) of the United Nations (UN).
  • The new format thus combines domestic aspiration with global aims.

The action agenda:

  • Relying on the proposals forwarded by the Fiscal Responsibility and Budget Management (FRBM) Review Committee, the action agenda estimates a fall in the share of non-development revenue expenditure, both as a proportion of total budget expenditure and GDP.
  • It emphasizes the need for optimal utilisation of resources and regular monitoring of progress. An obscurantist — and ill-advised — distinction between revenue and capital expenditures has spurred a misallocation of resources. A functional classification of public expenditure would indeed prove to be more meaningful.
  • Given the healthy state of the Indian economy, downside risks to achieving growth targets largely emanate from exogenous factors: Unfavourable monsoons, global protectionist trends and spikes in oil prices could impinge our twin deficits.
  • The continued pursuit of an unconventional monetary policy approach by advanced economies could limit the manoeuvrability of our monetary authority.
  • The public listing of PSUs will enable improved price discovery. If the expected level of tax buoyancy does not materialise, many other macro variables may need recalibration.

Effective implementation of the action agenda

The proposed plan needs broader support. It would be advantageous to constitute a separate parliamentary committee on planning, which could meaningfully engage with the NITI Aayog’s policy prescriptions. Delinking planning from finance has distinct advantages as functions of the treasury are neither symmetric, nor co-terminus with broader development issues. Such separations would also be in line with best global practices.

It would be desirable to create state-level bodies, to be called Sub-National Institutes for Transforming India (SuNITI), in formulating and expediting state-specific policies; this should enable state assemblies to discuss state-level plans in sync with the “Three Year Action Agenda” articulated by the NITI Aayog.

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