What was meant by the term "commanding heights of the economy" in the second five year plan of India?
Show answer & explanation
Correct answer: A
Explanation
Correct Answer:
Option 1: Complete control over the vital industries by government which are important for economy.
Explanation:
The Second Five-Year Plan (1956–61) was based on the Mahalanobis Model, which placed special emphasis on the development of heavy industries and infrastructure. The term "Commanding Heights of the Economy" referred to those key and strategic industries that are vital for the country's economic growth—such as steel, energy, machine manufacturing, and transport. A policy was adopted to bring these sectors under the public domain and keep them under government control, with the aim of ensuring the planned utilization of resources and achieving self-reliance. This concept points towards a socialist economic framework, in which the state plays a dominant role.
Additional Facts:
Option 2: Complete control by the private sector was contrary to this policy.
Option 3: Emphasis on free trade was not a primary objective of this plan.
Option 4: Promoting foreign investment was not a primary goal at that time.
Potential Questions for Upcoming Exams:
Question: What was the basis of the Second Five-Year Plan?
Answer: The Mahalanobis Model
Question: When was the Second Five-Year Plan implemented?
Answer: 1956–61
Question: What is the meaning of a 'Mixed Economy'?
Answer: The coexistence of both the public and private sectors
Question: Which plan emphasized the development of heavy industries?
Answer: The Second Five-Year Plan