India General Knowledge MCQs

MODULE 6: Indian Economy MCQs

Topic: Indian Economic Planning & Five Year Plans MCQs

These MCQs are systematically divided into clearly defined sub-topics covering the origin of economic planning, Five Year Plans, objectives, strategy shifts, achievements, limitations, and transition to the new planning framework. The content is suitable for school, college, university, entrance examinations, and all major competitive exams across India.

Sub-Topic I: Concept & Origin of Economic Planning in India

Q1. Economic planning in India was inspired mainly by the model of:

A. USA
B. UK
C. USSR
D. Japan

Correct Answer: C

Explanation:
India’s planning approach was inspired largely by the Soviet Union’s centralised planning model, especially during the early post-independence period.

Q2. Economic planning in India formally began in:

A. 1947
B. 1950
C. 1951
D. 1955

Correct Answer: C

Explanation:
Economic planning formally began with the First Five Year Plan (1951–56).

Q3. The main objective of economic planning in India was to:

A. Maximise profits
B. Reduce government role
C. Achieve rapid economic development
D. Promote export-led growth

Correct Answer: C

Explanation:
Indian economic planning aimed at rapid economic development with social justice, not mere profit maximisation.

Q4. Which institution was responsible for formulating Five Year Plans?

A. Finance Commission
B. RBI
C. Planning Commission
D. Ministry of Finance

Correct Answer: C

Explanation:
The Planning Commission was the apex body responsible for formulating, implementing, and monitoring Five Year Plans.

Q5. Indian planning is best described as:

A. Centralised planning
B. Decentralised planning
C. Democratic planning
D. Indicative planning

Correct Answer: C

Explanation:
India followed democratic planning, where planning objectives were set by the government but implemented within a democratic framework.

Sub-Topic II: First to Third Five Year Plans

Q6. The First Five Year Plan primarily focused on:

A. Heavy industries
B. Agriculture and irrigation
C. Defence production
D. Export promotion

Correct Answer: B

Explanation:
The First Plan emphasised agriculture, irrigation, and food security to stabilise the economy.

Q7. The Second Five Year Plan is associated with:

A. Mahalanobis Model
B. Green Revolution
C. Rolling Plan
D. LPG reforms

Correct Answer: A

Explanation:
The Second Plan followed the Mahalanobis model, emphasising heavy industries and capital goods.

Q8. Which sector was given priority in the Second Five Year Plan?

A. Agriculture
B. Small industries
C. Heavy industries
D. Services

Correct Answer: C

Explanation:
Heavy industries were prioritised to build a strong industrial base for long-term growth.

Q9. The Third Five Year Plan aimed at:

A. Self-reliance
B. Export-led growth
C. Privatization
D. Fiscal consolidation

Correct Answer: A

Explanation:
The Third Plan aimed at making India self-reliant, but was disrupted by wars and droughts.

Q10. The failure of the Third Five Year Plan was mainly due to:

A. Poor governance
B. Natural disasters only
C. Wars and economic instability
D. Lack of planning

Correct Answer: C

Explanation:
Wars with China and Pakistan and severe droughts disrupted plan targets.

Sub-Topic III: Plan Holiday, Fourth to Sixth Plans

Q11. The period 1966–69 is known as:

A. Perspective Plan
B. Rolling Plan
C. Plan Holiday
D. Green Plan

Correct Answer: C

Explanation:
This period is called Plan Holiday due to economic instability and re-evaluation of planning strategy.

Q12. The Fourth Five Year Plan emphasised:

A. Industrial growth only
B. Growth with stability
C. Liberalisation
D. Export promotion

Correct Answer: B

Explanation:
The Fourth Plan focused on growth with stability and self-reliance.

Q13. The Fifth Five Year Plan focused on:

A. Industrialisation
B. Poverty alleviation
C. Defence expansion
D. Export growth

Correct Answer: B

Explanation:
The Fifth Plan introduced Garibi Hatao, focusing on poverty alleviation.

Q14. Which plan was terminated prematurely?

A. Fourth Plan
B. Fifth Plan
C. Sixth Plan
D. Seventh Plan

Correct Answer: B

Explanation:
The Fifth Five Year Plan was terminated early due to a change in government.

Q15. The Sixth Five Year Plan marked the beginning of:

A. Nationalisation
B. Liberal economic policies
C. Green Revolution
D. Cooperative federalism

Correct Answer: B

Explanation:
The Sixth Plan marked the beginning of economic liberalisation and reduced state controls.

Sub-Topic IV: Seventh to Twelfth Five Year Plans

Q16. The Seventh Five Year Plan focused on:

A. Heavy industries
B. Employment generation
C. Export promotion
D. Fiscal deficit reduction

Correct Answer: B

Explanation:
Employment, productivity, and social justice were key concerns of the Seventh Plan.

Q17. The Eighth Five Year Plan is associated with:

A. Nationalisation
B. LPG reforms
C. Rolling planning
D. Cooperative farming

Correct Answer: B

Explanation:
The Eighth Plan coincided with the 1991 LPG economic reforms.

Q18. The Ninth Five Year Plan emphasised:

A. Rapid growth
B. Growth with social justice
C. Export competitiveness
D. Capital accumulation

Correct Answer: B

Explanation:
It aimed at growth with social justice and equity.

Q19. The Eleventh Five Year Plan focused on:

A. Industrial growth
B. Inclusive growth
C. Export-led growth
D. Fiscal consolidation

Correct Answer: B

Explanation:
The Eleventh Plan highlighted inclusive growth as a central objective.

Q20. The Twelfth Five Year Plan aimed at:

A. Maximum GDP growth
B. Faster, sustainable and inclusive growth
C. Industrial expansion only
D. Export surplus

Correct Answer: B

Explanation:
The Twelfth Plan emphasised sustainability along with growth and inclusion.

Sub-Topic V: End of Planning Commission & New Framework

Q21. The Planning Commission was replaced in 2015 by:

A. Finance Commission
B. RBI
C. NITI Aayog
D. Economic Advisory Council

Correct Answer: C

Explanation:
NITI Aayog replaced the Planning Commission to promote cooperative federalism and a bottom-up approach.

Q22. NITI Aayog mainly functions as a:

A. Allocating body
B. Regulatory authority
C. Policy think tank
D. Audit institution

Correct Answer: C

Explanation:
NITI Aayog acts as a policy think tank, not a fund-allocating body.

Q23. Five Year Plans were officially discontinued after:

A. Tenth Plan
B. Eleventh Plan
C. Twelfth Plan
D. Thirteenth Plan

Correct Answer: C

Explanation:
The Twelfth Five Year Plan (2012–17) was the last Five Year Plan.

Q24. The new planning approach emphasises:

A. Centralised control
B. Bottom-up planning
C. State domination
D. Export orientation

Correct Answer: B

Explanation:
The new framework promotes bottom-up and cooperative planning involving States.

Q25. Which of the following is NOT a feature of the new planning framework?

A. Flexibility
B. Cooperative federalism
C. Fixed Five Year targets
D. Outcome-based approach

Correct Answer: C

Explanation:
Fixed Five Year targets are no longer followed.

Sub-Topic VI: Evaluation & Exam-Oriented Concepts

Q26. Indian economic planning aimed at reducing:

A. Imports
B. Inequality
C. Trade
D. Industrialisation

Correct Answer: B

Explanation:
One major goal of planning was reducing income and regional inequality.

Q27. Which sector benefited most during the early planning period?

A. Services
B. Agriculture
C. Public sector industries
D. IT sector

Correct Answer: C

Explanation:
Early plans strongly promoted public sector-led industrialisation.

Q28. A major limitation of Five Year Plans was:

A. Lack of vision
B. Over-centralisation
C. Absence of goals
D. Excess growth

Correct Answer: B

Explanation:
Planning was criticised for over-centralisation and inefficiency.

Q29. Rolling Plan means:

A. Fixed targets for five years
B. Annual revision of plans
C. No long-term planning
D. Only short-term planning

Correct Answer: B

Explanation:
Rolling Plans allow periodic revision of targets based on performance.

Q30. Indian economic planning ultimately aimed at:

A. Capital accumulation
B. Industrial dominance
C. Economic growth with social justice
D. Export maximisation

Correct Answer: C

Explanation:
The ultimate objective was economic growth combined with equity and social welfare.

• Five Year Plans in India MCQs

• Indian economic planning MCQs

• Planning Commission and NITI Aayog MCQs

• Objectives of Five Year Plans MCQs

• Indian economy planning questions

• Economic reforms and planning MCQs

• Inclusive growth Five Year Plan MCQs

• Indian economy planning for UPSC

⭐ Master Indian Economic Planning with Exam-Focused MCQs

This MCQ set on Indian Economic Planning & Five Year Plans offers a clear, chronological, and concept-driven understanding of India’s planning journey—from the First Five Year Plan to the transition towards NITI Aayog. By covering objectives, strategies, achievements, limitations, and reforms, these questions help aspirants build strong conceptual clarity and historical perspective, essential for scoring well in Indian Economy sections of competitive and academic examinations.

❓ FAQ Section

Q1. Why are Five Year Plans important for Indian Economy exams?

Five Year Plans explain India’s development strategy, sectoral priorities, and policy shifts, making them a frequently tested topic in competitive exams.

Q2. What topics are covered under Indian Economic Planning MCQs?

These MCQs cover the origin of planning, objectives of Five Year Plans, major plan strategies, plan holidays, reforms, and the shift to the new planning framework.

Q3. Are these MCQs useful for both prelims and mains exams?

Yes. They strengthen factual clarity for prelims and provide conceptual understanding useful for mains and descriptive answers.

Q4. Do these MCQs help school and university students?

Absolutely. The questions are aligned with NCERT-based Indian Economy syllabus, making them suitable for school, college, and university examinations.

Q5. How should aspirants revise Indian Economic Planning effectively?

Aspirants should revise plans chronologically, focus on objectives and outcomes, and practice MCQs regularly with explanations.

🎯 Targeting Exams 

Examinations Covered

These Indian Economic Planning & Five Year Plans MCQs are carefully designed for:

• UPSC Civil Services (Prelims & Mains)

• State Public Service Commission (PSC) Exams

• SSC (CGL, CHSL, MTS, GD)

• Banking Exams (IBPS, SBI, RBI)

• Railways & Defence Examinations

• State Government Recruitment Exams

• School Board Exams (CBSE & State Boards)

• College & University Examinations

• General Studies & GK-Based Entrance Tests