Consider the following statements regarding Indian Planning : 1. The Second Five-Year Plan emphasized on the establishment of heavy industries. 2. The Third Five-Year Plan introduced the concept of import substitution as a strategy for industrialization. Which of the statements given above is/are correct ?

The correct answer is Option 3 (Both 1 and 2) because both statements accurately reflect the historical trajectory of Indian economic planning.

• Statement 1 is correct: The Second Five-Year Plan (1956–1961), based on the Mahalanobis Model, shifted focus from agriculture to rapid industrialization. It prioritized the development of "commanding heights" of the economy, specifically basic and heavy industries like steel, chemicals, and machine building to build a self-reliant industrial base.
• Statement 2 is correct: While industrialization began earlier, the Third Five-Year Plan (1961–1966) formally solidified import substitution as a core strategy. The goal was to achieve self-sufficiency by producing goods domestically that were previously imported, thereby saving foreign exchange and protecting infant domestic industries from global competition.

Since both the emphasis on heavy industries (2nd Plan) and the strategic shift toward import-substituting industrialization (3rd Plan) are historical facts of the Nehruvian era, Option 3 is the right choice.