New strategy for 12th five year plan to include intangibles and uncertainties

NEW DELHI: The Planning Commission is mulling a 'scenario mapping' technique used by the US military agencies to develop scenarios that could help build flexibility in the twelfth plan to adjust to unexpected event.

"It will provide a radar that will point to dangers and storms that both the government and the private sector might encounter. Possibly also suggest solutions," Arun Maira, member, Planning Commission, told ET.

Apart from the traditional economic measures, such as investments and savings, the new strategy will include intangibles such as the aspirations of people, public and market sentiments, political will, governance issues, like corruption, to build the agenda.

"This is a unique concept. It might take us ahead of many countries as far as planning is concerned," Maira added.

The commission might rope in experts from institutions like the Shell Foundation and the Confederation of Indian Industry that are associated with similar projects.

"We are in discussion with the Planning Commission over this. The basic structure has been tested by us in India at 75 initiatives. The information is useful for the private sector as it has a lot to contribute to the country's plan as a whole," a CII official confirmed.

The technique will be used to create simulations of possible events in future that might test the adeptness of country's current policies and project need for further policy action.

The commission, which is in the process of drafting the 12th five year plan, will take a call on scenario mapping by January 2012. The plan commences on April 1, 2012.

The plan panel has already introduced new topics like that of governance, corruption and rising aspirations of a growing young population in its approach paper to the plan, indicating that the 12th plan document will be a paradigm shift from earlier documents.

"There is a feeling among many who are making the 12th plan that uncertainties, both social and economic, have increased. For instance, our economy is linked to that of the other economies in a way not seen earlier," said another official in the panel.

"To plan in such situations, we need to consider many things that we were taking for granted earlier. Things and issues are much more interlinked now than ever before. The 11th plan has shown that," added the official.

India would be one of the first nations in the world that will use this technique to chart out a comprehensive long-term plan for national policymaking.

The concept, however, is not new to India.

In 2002, the CII had unofficially developed visions for various states using the scenario mapping technique, which was later used by the World Economic Forum in 2006 to develop such scenarios for the BRIC - Brazil, Russia, India and China - nations.

Maira also asserts that the comprehensive scenario-based plan will also help Indian companies to make well-informed long-term investment plans.