With reference to India’s Five-Year Plans, which of the following statements is/are correct?

1. From the Second Five-Year Plan, there was a determined thrust towards substitution of basic and capital good industries.

2. The Fourth Five-Year Plan adopted the objective of correcting the earlier trend of increased concentration of wealth and economic power.

3. In the Fifth Five-Year Plan, for the first time, the financial sector was included as an integral part of the Plan.

Select the correct answer using the code given below.

Correct Option: 1 and 2 only

Let us analyze each statement step-by-step to understand the key objectives and strategies of India's Five-Year Plans:

Statement 1 is correct:
The Second Five-Year Plan (1956–1961), based on the Mahalanobis model, laid heavy emphasis on rapid industrialization with a specific focus on developing basic and capital goods industries. The economic strategy aimed at import substitution in heavy industries (like steel, machinery, and chemical industries) to build a self-reliant industrial base for the Indian economy.

Statement 2 is correct:
The Fourth Five-Year Plan (1969–1974) emphasized "Growth with Stability" and progressive achievement of self-reliance. It explicitly aimed at reducing inequalities in income and wealth, correcting the earlier trend towards the concentration of economic power in a few private hands.

Statement 3 is incorrect:
The Fifth Five-Year Plan (1974–1978) focused primarily on "Removal of Poverty" (Garibi Hatao) and attainment of self-reliance. It was actually during the Ninth Five-Year Plan (1997–2002) and Tenth Five-Year Plan onwards, following the post-1991 economic reforms, that the financial sector reforms and integration received detailed focus and strategic inclusion as an integral component of planning.

Therefore, statements 1 and 2 are correct, making 1 and 2 only the correct answer.