Planning Commission was an advisory body, and so is Niti Ayog. But the key difference between them is that while the former had powers to allocate funds to ministries and states; this function will be now of finance ministry. Niti Ayog is essentially a think tank and a truly advisory body. Other differences are as follows:
- The role of states in the planning commission era was limited. The states annually needed to interact with the planning commission to get their annual plan approved. They had some limited function in the National Development Council. Since Niti Ayog has all chief ministers of states and administrators of UT in its Governing Council, it is obvious that states are expected to have greater role and say in planning/ implementation of policies.
- The top down approach is reversed in Niti Ayog. It will develop mechanisms to formulate credible plans to the village level and aggregate these progressively at higher levels of government.
- The provision of regional council is there in Niti Ayog to address local / regional development issues.
- One of the new functions of Niti Ayog is to address the need of the National Security in the economic strategy. How this is to be done – is yet to be watched.
- While the planning commission formed Central Plans, Niti Ayog will not formulate them anymore. It has been vested with the responsibility of evaluating the implementation of programmes. In this way, while Niti Ayog retains the advisory and monitoring functions of the Planning commission, the function of framing Plans and allocating funds for Plan assisted schemes has been taken away.
The governing council, which has all chief ministers of states and administrators of the Union Territories sounds much like the National Development Council.