The five year plans were started during the Nehru era. Based on erstwhile USSR five-year planning. There is a division under Central Government called Planning Commission headed by Deputy Chairman(Planning Commission). The Deputy Chairman reports to the Prime Minister. Currently, Montek Singh Ahluwalia is the Deputy Chairman.
The Approach Paper for the twelfth Five-Year plan has been made after consultation with about 950 civil society bodies and after getting responses in facebook.com. The twelfth Five-Year plan has been criticized for focusing on GDP growth. The core issue of poverty and inclusive growth of all sections of Indian society has not been taken care of.
Now, firstly planning is done by the government in a communist setup. India currently is neither communist nor capitalist. A department like Planning Commission cannot just be wished away. Even though Planning Commission serves the aspirations of would be IAS officers by supplying Yojana magazine, this is not the purpose for which Planning Commission exists. It has to plan meticulously and plan for the poor as USSR would have done. Doing so is the duty of Planning Commission. It has failed to do so.
The focus is on increasing GDP of India and expecting that growth in GDP will result in removal of poverty. The growth in GDP is being planned by increasing market of India. The argument of UPA govt. is, the increase in GDP will give funds to other plans like employment guarantee and food security and thereby poverty can be eradicated. Here, one must not forget that only a fraction of money meant for poor actually reaches them.
As far as I am concerned the poor are undernourished. The farmers have been isolated from the rest of the society. They are given free/subsidized electricity and are allowed to sell at a fixed minimum price. This makes the farmer lazy and ignorant and is not involved with the market. A plan giving direct support to the undernourished and to poor farmers is the call of the day. They need to be directly helped.
Whatever be it, the government at the center wants to wash its hands off most of the well established systems. Agreed that Planning is planning and no action is guaranteed, but the least expectation was that Planning should not have been so arrogantly purposeless.