Saturday, September 22, 2012

Rural Development: Institutions and agencies since independence; Rural development programmes: foci and strategies; Decentralization and Panchayati Raj; 73rd Constitutional amendment.


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" India lives in its villages " ~~~ Mahatma Gandhi

India is a country of villages with 70% of India's population live in rural areas as per Census of India's 2011 Provisional Population Totals of Rural-Urban Distribution. And,a large majority of those villages have very poor socio - economic conditions. Therefore, one can understand the importance of developing the rural areas. A slowdown in rural growth/development rate leads to a slow down the national growth rate as well even if the urban growth remain remains the same or increases, refer -

The concerted efforts made to ameliorate the standard of living of the people of the villages is what is termed as Rural Development. And it is achieved through collective governmental and voluntary agencies' efforts in a country

Rural - Is an area where the people are engaged in primary industry in the sense that they produce things directly for the first time in cooperation with nature. People here live in villages,farms or isolated homes in remote areas. Agriculture is the main occupation of rural areas, others can be based on mining,oil and gas exploration,tourism, logging,etc.

Villages and rural development have always been a part of India since time immemorial and they used to be self sufficient and self sustained resembling small republics and the respective rulers used to pitch in efforts to better them.

However, the present structure and style of functioning of local self governments is a British structure.  A beginning of local government is said to have been made in the year 1687 when for the first time, a local governing body - Municipal corporation was formed in Madras.

The British were concerned with finances/revenue collection/not political, and they knew that they had to have their hands into the local governments to reach the grass roots for top to bottom control. This led to severe exploitation of the rural areas by the British for their vested interests and a big blow to the economy. The recurrent famines in the later part of the 19th century and the recommendations of the Famine Commission Lord Mayo's resolution regarding local government was passed where the majority of officials were to be nominated by the British govt.

Lord Ripon's Resolution of 1882 or Local self government set the political tone of local government self government in India. The members were to be elected locally.
2/3rd members to be elected and chaired by non official of the British govt. This was seen with contempt and suspicion by the British bureaucracy and stiff resistance was put up by them.  This proposal was barely implemented and in late 19th century it was withdrawn. In the 1906 session of Congress this concept was brought up again for debate and some initiatives regarding the same were taken by the ruling govt. with the initiative of Lord Curzon, Provincial Department of
Agriculture with Agricultural College and Provincial Research Institute were
established. in 1906 the Indian Agricultural Service was constituted.This was further carried on to the Government of India Act of 1919 (Provision of Abject in Transferred List) and followed by the Government Act 1935 as well with some changes to suit the current scenario.

During the Independence struggle and infact throughout it, the national leaders advocated village communities. The Gandhian view prevailed and Panchayates became the foundation of the local self government. This principle is enshrined in Article 40 of the Indian Constitution under the Directive Principles Of State Policy that lays down that the State shall take steps to organise village Panchayats and endow them with such powers and authority as may be necessary to enable them to function as units of self - government.

A large number of rural development programmes were started by the Nationalists and Social reformers out of which some gradually diminished due to various technical/administrative reasons and some merged with the Govt. sponsored schemes later.

For details these pre - independence schemes refer to -

All these programmes,irrespective of their failures/successes, were and are instrumental in setting the tone for rural welfare and development while framing the constitution, as well as a guiding force and examples for today's people and administrators of rural development.


The Ministry of Rural Development in India is the apex body for policy formulation,regulations and acts pertaining to the development of the rural sector,agriculture,handicrafts,fisheries,poultry,and dairy are the primary contributors to the rural business and economy.

 Refer to the Ministry's official website as well -

There are two departments under the Ministry :
i) Department of Land Resources - The main objectives of the Department are:
  • To increase productivity of rainfed/degraded land through the process of integrated watershed management.

  • To support the States/UTs for implementation of National Land Records Modernization Programme (NLRMP)

  • Land reforms and other related matters relating to land like administration of Land Acquisition Act, 1894, National Rehabilitation and Resettlement Policy of 2007 , Registration Act, 1908 etc.

  • Bio-diesel Mission
Refer :

ii) Department of Rural Development - Department of Rural Development in India is a department under the Ministry of Rural Development in the Central Government of India. The Department facilitates the provision of several services such as training and research facilities, human resource development, institutes of Panchayati Raj, and at the same time provides functional assistance to the DRDA and oversees the execution of projects and schemes.

Department of Rural Development also executes the schemes for wage employment and self-employment generation and, for providing small irrigation and housing facilities to the rural poor, provide economic aid to the poor in rural areas, basic minimum services. The department also develops roads in the rural areas.

The Department of Rural Development in India functions according to the formulated schemes.

Refer to the url -


The function of the Rural Development Division is primarily to provide overall policy guidance in formulation of plans and programmes for Rural Development. This is the nodal Division for matters relating to poverty eradication, employment generation in rural areas, development of watershed & degraded land. The following specific activities are undertaken by Division;
  1. To assist in formulation of rural development programmes to be included in Five Year Plans and Annual Plans and to make periodic assessment of progress achieved.
  2. To analyse and prepare comments on the EFC Memoranda and Cabinet Notes paper for Group of Ministers pertaining to rural development programmes.
  3. To maintain liaison with Ministry of Rural Development, National Institute of Rural Development (NIRD) and other allied organisations mainly and participating in the meetings.
  4. To collect information from various Divisions of the Planning Commission, State Governments and also from the Central Ministries which are implementing various schemes related to rural development.
  5. To organize Working Group meetings to finalise the Draft Five Year Plan proposals of the State Governments. This involves the preparation of background papers, discussions on inter-se plan priorities, critical examination of plan proposals in relation to plan objectives and approaches, preparation of Working Group Reports giving, inter-alia, outlays and physical targets.
  6. Finalisation of the Five Year Plan outlays of the Ministry of Rural Development. Finalisation of Annual Plans of the Central Ministry of Rural Development and State Governments. This includes assessment of progress both in physical and financial terms, in relation to the approved targets and outlays, scheme-wise examination of proposals and reviewing targets and finalizing allocation for next Annual Plan.
  7. To provide comments, materials etc. for Public representations, VIP references, Parliament Questions and Agenda items for the meetings of Consultative Committee/ Standing Committee for the Planning Commission pertaining to rural development sector are also attended to.

The above mentioned programmes of the Ministry Of Rural Development viz. anti - poverty,wage employment,rural housing,etc. are implemented and supervised by the District Rural Development Agencies ( DRDA) registered under the Societies Registration Act,1860,in the districts in the respective states. Substantial sums of rural development funds of government of India were transferred and routed through them under various Centrally Sponsored Schemes. From purely a financial resource from Rural Development point of view the DRDAs are extremely important institutions at the district level.

Both district level officials and public representative like M.P. , MLA ,Panchayat Samiti Chairpersons etc are the member of the Society. President, Zilla Parisad is the Ex-Officio Chairman of DRDA. All administrative and financial power are vested on Collector. The Project Director of the Agency looks after day to day administration. DRDA releases funds under various anti poverty programmes under Ministry of Rural Development,govt. of India and State Govt.   to various banks / executing agencies. It monitors the implementation of schemes, utilization of fund very closely. Following important schemes are implemented through DRDA.
There have been debates over merging of the DRDAs and the respective Panchayats as a part of decentralisation since DRDA is a centralised body and if true decentralisation is to be achieved then it should be given in charge of the respective local self governments. However, this complete merger has said to have happened in only two states that is Kerala and Karnataka who have a history of empowering the grassroots. Here, the DRDAs function as a unit of the Zilla Panchayat as cells of poverty alleviation / rural development schemes.

In 10 States/ UTs the DRDAs continue to be separate with the only linkage established with the ZPs is making the President of ZP the Chairperson of the DRDA. These are Bihar, Chattisgarh, Himachal Pradesh, Madhya Pradesh, Orissa, Punjab, Tripura, Uttar Pradesh, Uttarakhand, and Lakshadweep. In Gujarat the District Development Officer, who is also the Chief Executive Officer of the Zilla Panchayat, continues to chair the DRDA. In nine States/ UTs either the Collector continues as the Chair or some other arrangement has been made in this regard. These are Assam, Goa, Haryana, Jharkhand, Manipur, Tamil Nadu, Dadra & Nagar Haveli, Daman & Diu, and Pondicherry. Andhra Pradesh has made the Zilla Panchayat President the Chair of the DRDA while designating the Collector as the Executive Chairperson. Similarly, in Maharashtra, while the President Zilla Panchayat is made the Chair of the DRDA, the Chief Executive Officer of the Zilla Panchayat is designated as the Executive Chairman of the Management Committee.

Refer -

Table : Status of DRDAs in the States
Sl. NoState or U.TStatus of DRDA
1Andhra PradeshDRDAs are separate; Collector is the Executive Chairperson though ZP President is made the Chairperson; large number and scope of parallel bodies across layers
2Arunachal PradeshDRDAs are separate
3AssamDRDA separate; Collector is Chair and Ex Director; many parallel bodies
4BiharDRDA separate; ZP Chairman is Chairman of DRDA; many other parallel bodies;
5ChattisgarhReportedly DRDA merged; practically only the ZP Chairman is made the Chairman of DRDA;
6GoaDRDAs are separate;
7GujaratDRDA separate; District Development Officer is the Chairman;
8HaryanaDRDAs separate; Dy Commissioner/ Collector is the Chairman
9Himachal PradeshDRDAs separate; ZP chairman is the chairman of DRDA; there are many other parallel bodies
10Jammu & KashmirDRDAs separate; interestingly, the DRDA administration is being refurbished, which by itself could be a very positive step; Panchayat at district level is called the District Planning & Development Board – in a way combining the ZP and DPC
11JharkhandDRDAs separate; Dy Commissioner is Chairperson of DRDA
12KarnatakaDRDA merged with ZP since 1987; functions as a unit of ZP office with distinctiveness maintained only to facilitate transactions with the MoRD, New Delhi
13KeralaDRDAs merged with ZP, function as poverty alleviation cell of the ZP; some parallel bodies (Freshwater Fish Development Agency, Brackishwater Fish Development Agency) still function as per the directions of GoI. The MLA-LDF is also outside the purview and is sort of a parallel body.
14Madhya PradeshDRDAs separate; ZP Chairman is the Chairman of DRDA Many parallel bodies, particularly those funded by multilateral and bilateral agencies and operated by the State Government as para-statal entities; DPIP andMPRLP are two examples.
15MaharashtraDRDA separate, ZP Chairman has a cosmetic position of being Chairman of Governing Body of DRDA with the CEO being the executive chairman of the Management Committee
16ManipurDRDA separate; Dy Commissioner as the Head; Many parallel bodies primarily associated with the Development programmes/ schemes of the Union Government.
17OrissaDRDA separate; PD – DRDA is designated as the Secretary-cum- Executive officer of ZP; ZP President is the Chair of DRDA
18PunjabDRDAs separate; ZP Chairman is made the Chairman and it is said that all Panchayats have access to the expertise of DRDA; there are other parallel bodies at district and village levels (Village Water and SanitationCommittees, Village Education Committees), with no linkage with Panchayats
19RajasthanDRDA reportedly merged in 2003; however there are para-statals set up through multilateral funding as well as schemes of State and Union government
20SikkimDRDA is separate
21Tamil NaduDRDA separate institution; Chaired by the District Collector; many parallel bodies like in village education committee, watershed Associations, village forests committees exists.
22TripuraDRDA exists separately; President of ZP is the Chairman of DRDA
23Uttar PradeshDRDAs separate; headed by ZP President; there are a few other parallel bodies
24UttarakhandDRDA separate; ZP President is its chair; Van Panchayats, Village Education Committees are the other parallel bodies
25West BengalDRDA merged; rechristened as DRDC of ZP;
26Andaman & NicobarDRDA is separate; Out of three, only one ZP President is the Chair ofDRDA;
27ChandigarhNo DRDA
28Dadra & Nagar HaveliDRDA is separate
29Daman & DiuDRDA continues to function as a separate body and have not been merged.
30LakshadweepDRDA is said to be merged; ZP President is the Chair; DRDA providing support to the ZP; other parallel bodies relate to Central schemes such at the SSA;
31PondicherryDRDA is separate; Attempts are made to link other parallel bodies with Panchayats;


 NABARD was established on the recommendations of Shivaraman Committee, by an act of Parliament on 12 July 1982 to implement the National Bank for Agriculture and Rural Development Act 1981. It replaced the Agricultural Credit Department (ACD) and Rural Planning and Credit Cell (RPCC) of Reserve Bank of India, and Agricultural Refinance and Development Corporation (ARDC). It is one of the premiere agencies to provide credit in rural areas. The govt. holds 99% stake in NABARD since RBI sold its share to the GOI.

Objectives of National Bank for Agriculture and Rural Development are -
  • The National Bank for Agriculture and Rural Development would be the apex body pertaining to the planning of the financial and functional aspects of promotion for small-scale industries, agriculture, handicrafts, rural crafts, village industries, cottage industries, and any kind of commercial operations in the rural sector.
  • The National Bank for Agriculture and Rural Development would function as a refinancing organization for the credit given by financial agencies both long term loans and short term loans for promoting various kinds of activities in the rural sector.

  • The National Bank for Agriculture and Rural Development would facilitate the provision of direct loan to different institutions on the approval of the Central Government of India.
  • The National Bank for Agriculture and Rural Development would have constitutional connections with the apex bank, the Reserve Bank of India.

HARCOBANK is the apex organisations for rural development in the state of Haryana and its purpose is to financially assist the artisans in the rural areas,farmers and the agrarian unskilled labour,small and big rural entrepreneurs of Haryana by functioning as an investor since three decades now. Its reach is across the length and breadth of Haryana through its numerous branches and associate partners.
Agrarian credits under HARCOBANK are-
  • Loans schemes
  • Interim finance by the means of cash loans
  • Cash Credit against mortgage of property
  • Crop Loan and Kisan Credit Card
Loan schemes under non-farm finance of HARCOBANK

  • Loans against mortgage of jewelry and gold ornaments
  • Loans to the students engaging in professional degree courses such as medicine, engineering, management, etc. based on the repayment capability of the applicant of the loan
  • Loans for the purchase of taxi-cars, auto rickshaw, light commercial vehicles, motor buses, trucks, and others those who fall under the category of small transport operators
  • Cash loan facility to traders and businessmen against mortgage of collateral or stock hypothecation trade
  • Scheme for buying consumer durables
  • Short time overdraft facility to people based on the credit report or presenting collateral securities, etc.
  • Composite loan scheme
  • Advances against national savings certificate (NSC)
  • Farm sector activities
  • Small transport operators, water, and road scheme
  • Integrated loan scheme
Banking deposit schemes under HARCOBANK -

  • Fixed Deposit
  • Recurring Deposits
  • Money Multiple Certificate (MMC)
  • Re-investment Term Deposit (RITD)
  • Combined Recurring Deposits and Provident Funds for different institutions
Staff Loan facilities under HARCOBANK -

  • House Building Loan for construction, repair, extension of house property
  • Conveyance Loan for vehicles for cars, scooters, motorcycles
  • Computer Loans for household purpose of the employees
According to its financial position and its total performance at the domestic level, the National Federation of State Cooperative Banks (NAFSCOB) and National Bank for Agriculture and Rural Development (NABARD) have awarded the Haryana State Cooperative Apex Bank Limited.


  • Special award for Recovery and Profitability in 1998-99
  • Special Award in Profitability for 1999-2000
  • Special Award in Outreach, Recovery Performance and Profitability for 2000-01
  • Special Award in performance for 2001-02
  • Second-Overall Performance for 2002-03

The main goal of establishing regional rural banks in India(1975 via the Narsimhan Committee report) was to provide credit to the rural people who are not economically strong enough, especially the small and marginal farmers, artisans, agricultural labours, and even small entrepreneurs. But there have been many issues regarding its financial viability numerous analysis and studies have been taking place to study the same.

Refer for list of the Regional Rural Banks In India:

 Microfinance institutions provide financial assistance to micro-entrepreneurs and small businesses where there is a lack of banking and related services due to high transaction costs associated while serving these client categories. They provide these financial services through relationship - based banking for individual entrepreneurs and small businesses; and group based models where several entrepreneurs come together to apply for loans and other services as a group.

These Microfinances are also assited by the NABARD. And to recognise their pivotal efforts, the GOI has recently passed the Microfinance Services Regulation Bill. Refer to article -    &

For list of Microfinance Institutions:

AVARD is Association of Voluntary Agencies for rural development - refer

Also a mention should be made of the Aga Khan Rural Development Network which is a voluntary foundation doing exemplary work in Madhya Pradesh, Bihar and Gujarat.

Refer -


Rural Development Programmes or Bharat Nirman Plan of the GOI comprise of the following:
i) Provision of basic infrastructure facilities in the rural areas like schools,health facilities,roads,drinking water,electrification,etc.

ii) Improving agricultural productivity in the rural areas.

iii) Provision of social services like health and education for socio - economic development.

iv) Implementing schemes for the promotion of rural industry increasing agricultural productivity, providing rural employment,etc.

v) Assistance to individual families and Self Help Groups living below poverty line by providing productive resources through credit and subsidy.

Refer - &

Lets discuss them:
1) Pradhan Mantri Gram Sadak Yojana - A fully funded Centrally Sponsored Scheme to provide all
weather road connectivity in rural areas of the country. The programme
envisages connecting all habitations with a population of 500 persons and
above in the plain areas and 250 persons and above in hill States, the tribal
and the desert areas.

2) Swarnajayanti Gram Swarozgar Yojana - SGSY is a major on-going scheme for the self-employment of the rural poor. The basic objective of the scheme is to bring the assisted poor families (swarozgaris) above the poverty line by providing them income generating assets through a mix of bank credit and government subsidy. Credit is the critical component of the scheme whereas the subsidy is an enabling element. The scheme involves organisation of the poor into Self Help Groups (SHGs) build their capacities through a process of social mobilization, their training, selection of key activities, planning of activity clusters, creation of infrastructure, provision of technology and marketing support, etc. Under the scheme focus is on the group approach. However, individual Swarozgaris are also assisted. The SGSY is being implemented by the District Rural Development Agencies (DRDAs) with the active involvement of Panchayati Raj Institutions (PRIs), banks, line Departments and the Non-Government Organisations (NGOs).
The credit mobilization under SGSY has been abysmally low. Further, a large number of SHGs are formed but fizzle out midway after availing the revolving fund. To make the scheme more effective it is being re-structured with a sharper focus on poorest of the poor people. A suitable mechanism will be put in place for higher social mobilization, capacity building and institution building among the target population

3) Rural Housing (Indira Awas Yojana) - The IAY is being implemented as an independent scheme since 1996. It aims to provide assistance for construction / up gradation of dwelling units to the Below Poverty Line (BPL) rural households, with special emphasis on SCs, STs and freed bonded labor categories. A maximum assistance of Rs 35,000 per unit is provided for construction in plain areas and Rs 38,500 per unit for hilly/difficult areas. Rs 15000 is given for up gradation of a dwelling unit for all areas. The funding of IAY is shared between the Centre and State in the ratio of 75:25. (100% in the case of UTs).

4) MGNREGA - The primary objective of the scheme is to provide guaranteed work for 100 days for any household wishing to have such employment. Although all households are eligible, the expectation is that only the poorer sections, i.e., landless labour and marginal farmers would actually seek work. The secondary objective is to ensure that employment generated is from works that raise land productivity.

5) National Social Assistance Programme - The National Social Assistance Programme (NSAP) was launched with the aim to provide social assistance benefit to poor households in the case of old age, death of primary breadwinner and maternity. The programme supplements the efforts of the State Governments with the objective of ensuring minimum national levels of well being and the Central assistance is an addition to the benefit that the States are already providing on Social Protection Schemes. With a view to ensure better linkage with nutrition and national population control programmes, the Maternity Benefit Component of the NSAP was transferred to the Department of Family Welfare, Ministry of Health and Family Welfare with effect from 2001-02. The schemes of NSAP and Annapurna have been transferred to the State Plan with effect from 2002-03 with a view to provide requisite flexibility to the State / UT in the choice and implementation of the schemes.

6) Integrated Watershed Management Programme (IWMP) - During the Eleventh Plan, the three area development programmes, namely, Integrated Wasteland Development Programme, Drought Prone Area Programme and Desert Development Programme have been integrated and consolidated into a single programme called Integrated Watershed Management Programme (IWMP). This consolidation is for optimum use of resources, sustainable outcomes an integrated planning. The common guidelines for the Watershed Development Programme have been formulated and are effective from 1.4.2008. An amount of Rs.1825 crore has been allocated for IWMP during 2008-09. The ongoing projects sanctioned prior to 1.4.2008 under DADP, DDP, and IWDP would be continued to be implemented as per old guidelines.
The modified IWMP would adopt a three tier approach in which the upper reaches which are mainly forested and hilly would be treated with the support of Forest Department. For land situated intermediate slopes above the agriculture lands, the IWMP would address all the necessary issues of land treatment by adopting best possible options including cropping pattern, horticulture and agro-forestry etc. In the lower tire, which are plains and mainly agricultural lands, the IWMP would be dovetailed with the employment generating programme such as National Rural Employment Guarantee Scheme (NREGS) an would fill the critical gaps of NREGS and vice versa.
Under the new programme, a cluster approach would be followed with a broader vision of natural hydro-geographical unit of average size of 4,000 to 10,000 ha. comprising of clusters of micro-watershed to be selected as project area. The programme would be implemented by dedicated institutional agencies at state and central level. Professional support (in the form of multidisciplinary expert team) would be provided to support these institutions with proper fund allocation. A core GIS facility with spatial and non-spatial data augmented with satellite imagery data would be set up for giving Controlled access/distribution for local project planning.
The project period is proposed in the range of 5 to 7 years in three distinct phases, i.e. Preparatory, Watershed works and Consolidation phase. The consolidation phase will include livelihood activities, marketing, processing and value addition activities.
7) National Land Records Modernization Programme (NLRMP): The National Land Records Modernization Programme (NLRMP) has been conceptualized as a major system and reform initiative that is concerned not merely with computerization, updating and maintenance of land records and validation of titles, but also as a programme that will add value and provide a comprehensive database for planning developmental, regulatory and disaster management activities by providing location-specific information, while providing citizen services based on land records data.
Under the NLRMP, the following three layers of data will be integrated on a geographic information system (GIS) platform: Spatial data from satellite imagery/aerial photography, Survey of India and Forest Survey of India maps, and Revenue records: cadastral maps and RoR details. All cadastral maps will be digitized, and data included with plot numbers and unique id for each land parcel. Administrative unit boundaries from village level upwards (including panchayat, block, tehsil, circle, sub-division, district, division, State and national boundaries), forest, water bodies and other physical attributes of land and land use details will be overlaid, and other developmental layers (e.g., watersheds, road networks, etc.) added to the core GIS.
The activities to be supported under the Programme, inter alia, include survey/resurvey using modern technology including aerial photogrammetry, updating of land records including mutation records, completion of computerization of the records of rights (RoRs), computerization of registration, automatic generation of mutation notices, digitization of maps , integration of the entire system digitization of maps and training and capacity building of the concerned officials and functionaries. Connectivity amongst the land records and registration offices and land records management centers at tehsil/taluk/circle/block level would be supported. Access to land records data would be provided to Cooperative and other financial institutions for facilitating credit operations.
A major focus of the Programme will be on citizen services, such as providing records of rights (RoRs) with maps; other land-based certificates such as caste certificates, income certificates (particularly in rural areas), domicile certificates; information for eligibility for development programmes; land passbooks, etc.
In addition, the Programme will be of immense usefulness to the governments - both Central and State Governments - in modernizing and bringing efficiency to the land revenue administration as well as offering a comprehensive tool for planning various land-based developmental, regulatory and disaster management activities needing location-specific information. Even the private sector will be able to benefit from this comprehensive tool for planning business and economic activities.
For the above mentioned and other important programmes presently being implemented by the Ministry of Rural Development, refer and click on the respective links for detailed information:

For a vibrant and dynamic local self government Political Decentralization is a major advantage as then programming becomes more realistic and local problems receive immediate and urgent attention and the decision makers are more effectively accountable as local vigilance also increases thus reducing corruption.
Towards this goal, and keeping Gandhi ji's Sarvodaya (upliftment and progress of all) principle in mind,the GOI on 2nd October 1952(Gandhi Jayanti) launched a programme through which an all round development of the population ( rural) was sought that was termed as the Community Development Programme as a part of the first Five Year Plan alongwith a booster programme called the National Extension Services at the Block level headed by the Block Development Officer,however its implementation disclosed a distinct lack of citizen interest. Therefore, the Balwant Rai Mehta Committee to study and diagnose the same was set up and it brought forward the reason for this disinterest which was a dearth of avenues of popular participation in local level development programmes for the public/people.

The Balwant Rai Mehta Committee suggested the following as corrective measures in 1957:
i) A three tier Panchayati Raj structure to be established wherein the uppermost tier will be the Zilla Parishad ( District), while the lowermost tier shall be the Gram Panchayat ( Village level) and the intermediate tier was to be the Panchayat Samiti ( Block/ Taluk level).
ii) District Colector was to be the Chairperson of the Zilla Parishad and had an advisory and coordinating role.
iii) Panchayat Samiti to be entrusted with the executive powers.
iv) Direct elections to level of Gram Panchayat and higher level appointments to be made through nominations and other indirect means.
v) The Panchayat Samiti to have the headmen or sarpanch of the gram panchayat as its members while the Zilla Parishad shall be a body consisting of ex-officio members and headmen of the Panchayat Samiti.
vi) District or Zilla Parishad was seen as a unit for achieving democratic decentralisation and it was recommended as the unit for planning and organising as well as supervising district administrative functions.

This was implemented but some states were not in favour of giving such far reaching executive powers to the Panchayat Samiti ( Block level) and instead rooted for the District/Zilla Parishad as the executive body as it is alone capable of providing the requisite resources, administrative and technical personnel and equipment required for properly coordinated development. This was suported by the G.V.K Rao Committee as well that was setup to study the implementation of the abovementioned three tier structure. Maharashtra and Gujarat and Karnataka have adopted this model where the district is the executive body,in other states the Panchayat Samiti remains the executive body.

However, after the initial support and setting up of the Panchayati Raj in the villages, it suddenly took a backseat in the wake of new national and state level political leaderships in 1966 that had much thinner links with the Gandhian ideals and a leaning towards centralism and making the state governments subservient to the centre.And, the mounting food shortage of this period and crop failures led to reshuffling of priorities that focused on increasing agricultural production majorly. This reduced the role of the Panchayati raj from that of rural development to that of agricultural production as the new technologies for increased agricultural productivity gave leeway to the central government to enter the state and local governments' sphere of activity and subjects to implement the new programmes. The central government for implementing the new schemes and programmes in agriculture began to develop its own independent administrative hierarchies and  systematically bypassed the panchayati raj institutions.

All this was done through the bureaucracy,that is the District Collector at the local level and this led to alienation between bureaucracy and grassroot politicians viz. the ordering of affairs of the Panchayati Raj.

Coupled with this was the state government's lackadaisical attitude towards holding timely elections to these local bodies and when elected were suppressed by the state governments for the flimsiest of reasons. Inadequacy of funds available to these local bodies due to vested interests left them high and dry and incapable of initiating any developmental measures for the local community and thus they were totally on the mercy of the state and central governments.

Thus, seeing the pathetic condition of the Panchayati Raj Institutions, the Janata Party in 1977 set up  the Ashok Mehta Committee to examine the same. After examining the case, the committee recommended  the constitution of  two tier structure of PRIs with  'Mandal Panchayats' at the lower level and district level(Zilla Parishad) at the upper level.

Its detailed recommendations were:
i) A two tier structure (in place of a previously recommended three tier one) wherein the Zilla Parishad would remain the uppermost tier and  at the lower level,the ' Mandal Panchayat' was to be created for a cluster of villages having a population of 15 to 20 thousand and its 15 members to be directly elected by the people with a term of four years. He did not favour Gram Panchayats as he stated that the size of villages differed from district to district and hence there should be a standard benchmark for all districts. Note should be made, that after a while and conducting more studies he did recommend and favour the Block Level Panchayat Samiti arrangement to be kept as well as the intermediary between the Zilla Parishad and the Mandal Panchayats.

ii) The Zilla Parishad was to be the executive machinery at the District level.

iii) Participation of political parties in the elections to Panchayats to ensure continutiy of political process and aganda and making the local levels important and significant.

iv) Cabinet Minister with Panchayati Raj portfolio in the cabinet of the state Chief Minister to directly and specifically overlook the development of the local governments.

v) Constitution of a committee in the legislative assembly of the states to carry out a detailed scrutiny of the District Administration Programmes implementation in Panachayati Raj Institutions.

vi) Constitution of Nyaya Panchayats seperate from Development/Administrative Panchayat and to be headed by a Judicial Officer.

vii) Reservation of SC/ST in the Panchayats in proportion to their population in that Panchayat area and taxation powers to be given to the PRIs.

viii) Gram Sabha to be constituted together with the Gram Panchayat(elected representatives of the area through local people), consisting of all the electors/voters of that Panchayat area,who will be vested with the powers to consider the accounts and administration of the Panchayats and approve proposals for taxation and plans for development so that they are free from the hold of state governments, and they have to meet twice a year.

ix) Amendments to the Constitution to effect these changes.

x) The Chief Electoral Officer of the state in consultation with the Chief Election Commissioner should organise and conduct the Panchayati Raj elections.

xi) The state government should not supersede the Panchayat Raj institutions. In case of an imperative supersession, election should be held within 6 months from the date of supersession.

xii) The voluntary agencies should play an important role in mobilising the support of the people for Panchayati Raj.

As a result of this report, the Indian states of Karnataka, Andhra Pradesh, and West Bengal passed new legislation. However, the flow of politics at the state level later on did not allow the institutions to develop their own political dynamics.

Heavy centralisation during the Indira Gandhi regime subsequently started to bring back public opinion in favour of decentralisation seeing the shining models of Karnataka,Andhra Pradesh and West Bengal. So, when Rajiv Gandhi took over the reins, in order to consolidate his political mileage and interests that were deteriorating he took to the cause of Panchayati Raj Institutions to directly penetrate to the deepest level of voters bypassing the states. This was further strengthened by the L.M Singhvi's Commission on PRIs which recommended according of Constitutional status to PRIs and non involvement of Political parties in the elections to PRIs.

However, the bill was moved (64th Amendment) but fell flat in the upper house as Congress found itself out of power. In 1990, the National Front govt. under V.P Singh also moved another bill in the Parliament but it could not carry through as the govt. soon collapsed within no time.

Congress under the Prime Ministership of P.V Narsimha Rao in 1991 picked the PRI issue up again and consulted all major political parties while drafting the new PRI Bill and thus with all consent was passed in the parliament which was the 73rd Amendment Act in December 1991. It began operation in 1993 after its implementation was strategised and finalised and thus was opened a new chapter in History of the Panchayat Raj as a Constitutional body and made PRIs compulsory in all states and UTs with clear areas of jurisdiction and powers.


The 73rd Constitutional Amendment Act is seen as the Magna Carta of decentralisation & social justice. The structure of the PRIs are broadly based on the Balwant Rai Mehta Committee report.

The main features of the Act Schedule XI, Part 9, ( Article 243 - 243o) are:
i) A 3 tier system of Panchayati Raj for all states having population of over 20 lakhs.
ii) All the seats in a panchayat at every level are to be filled by elections from respective territorial constituencies & Panchayat elections to be held regularly every 5 years.
iii) To appoint State Finance Commissions for making recommendations to suggest measures to strengthen finances of PRIs.
iv) To constitute District Planning Committees to prepare draft development plans and promote bottom-up-planning.
v) Estabilishment of State Election Commissions to supervise, direct and control the regular and smooth elections to panchayats
vi) Estabilishment of Gram Sabhas or village assembly as a deliberative body to decentralised governance.
vii) Reservation of seats for SC and ST and women ( not less than 1/3rd of seats).

An indicative list of 29 items has been given in Eleventh Schedule of the Constitution. Panchayats are expected to play an effective role in planning and implementation of works related to these 29 items.

The Gram Panchayat have been entrusted with both obligatory and discretionary functions which are both civic and developmental. The main emphasis being on development activities such as agriculture,primary education,health and sanitation and local amenities.

The Samithis throughout the country are entrusted with functions relating to planning and development. Its functions include agriculture and related activities, social welfare, education, health and sanitation,etc. They are also required to exercise supervision over the gram panchayats within its jurisdiction. In some Samithis, they also approve the budget of the Panchayats. In Maharasthra, the samithis implement development schemes formulated by Zilla Parishads and act as the committees of the latter.

The functions of the Zilla Parishad vary considerably from state to state. In some states they are concerned with supervisory and coordinating functions. In others they have specific role in regard to establishment and expansion of secondary education and vocational schools. In Maharasthra,however,it is the most important unit as it is entrusted with executive functions.


Nyaya Panchayats try petty civil and criminal cases and can impose fine. But they cannot award imprisonment. However, exceptions are there and in Bihar, Nyaya Panchayats may even award imprisonment. At times, Nyaya Panchayat gives only warning. District Officer may send for recommendation of any judgement given by Nyaya Panchayat. In general, the performance of Nyaya Panchayat is not encouraging because people do not appear before Nyaya Panchayats.

At present, there are about 3 million elected representatives at all levels of the panchayat one-third of which are women. These members represent more than 2.4 lakh Gram Panchayats, about 6,000 intermediate level tiers and more than 500 district panchayats . Spread over the length and breadth of the country, the new panchayats cover about 96 per cent of India's more than 5.8 lakh villages and nearly 99.6 per cent of rural population. This is the largest experiment in decentralisation of governance in the history of humanity.
The Constitution visualises panchayats as institutions of self-governance. However, giving due consideration to the federal structure of our polity, most of the financial powers and authorities to be endowed on panchayats have been left at the discretion of concerned state legislatures. Consequently, the powers and functions vested in PRIs vary from state to state. These provisions combine representative and direct democracy into a synergy and are expected to result in an extension and deepening of democracy in India. Hence, panchayats have journeyed from an institution within the culture of India to attain constitutional status.

i) The Centre and states continue to exercise powers in planning and the Panchayats do not enjoy autonomy financial and administrative as institutions of local self - government.

ii) The state governments often delay Panchayat elections on purely political considerations as they take advantage of the powers of issuing election notifications,delimitation of constituencies,earmarking of reserved seats and the State Election Commission's dependence upon the state govt. for logistic support including staff and finances. Therefor there is a need to strengthen the SECs by making specific provisions in the Constitution(through amendments to article 23k itself to make them independent of the state governments and draw expertise and guidance from the Election Commission of India and the State Election Commission shall submit its annual report to the Election Commission and to the Governor,every year and it may at any time submit special reports on any matter which in its opinion is of such urgency or importance that it should not be deferred till the submission of its annual report.

iii) Since the functions of the Panchayats are not posited as exclusive functions therefore, their role and governance depends on  the regime that controls the state government.

iv) States only assign them the responsibilities of implementing of the schemes/projects of the state and union,as a result they are only occupied with that and are not able to raise their might for the problems actually concerning the local areas/Panchayats they are in charge of. So, to correct this Article 243g of the Indian Constitution should be amended to declare the Panchayats as institutions of self-government and exclusive functions should be assigned to them that are clearly spelled out and demarcated for them.

v) State govts are still hesitant and reluctant in sharing their fiscal powers with the Panchayats and so there should be a separate tax domain/field exclusively for the PRIs and for this there should be an addition of a local list in the Seventh Schedule of the Indian Constitution together with the Union,State,Concurrent and Residual lists so that they gain their fiscal autonomy at par with the union and states.

vi) State Finance Commissions after collecting the reports from the local levels should submit its report to the Finance Commission for fund allocation and Finance Commission should make their recommendations in this light.

vii) The Constitution is silent on the topic of power of PRIs to recruit their own personnel to manage its functions and this has led to the slow growth of PRIs as self governing institutions. Thus there needs to be an amendment regarding the same to confer them with such autonomy.

viii) There should be a provision in the Indian Constitution to provide the Panchayats with an opportunity of being heard before dissolution by the state governments as this ommission has only lead to state governments carrying out their malafides whenever they want and dissolving the PRIs and then delaying elections,etc.

ix) The lack of coordination amongst the PRI machinery also needs to be addressed immediately for smooth rural development. There should be a provision for constitution of a state Panchayat Council under the chairmanship of the Chief Minister may be made in the Indian Constitution. And, the leader of opposition may be made the ex-officio vice chairman of the Council to provide consensus to the development of Panchayats as fully democratic,efficient and responsible institutions.

x) There is a lack of accountability of Panchayats because of inadequate provisions in law relating to audit of accounts of public bodies. And, there is not time frame to conduct audit of accounts of a given year,submit the report or comply with the objections raised in the report thus leading to misuse of funds,bad implementation of projects and overall weakening of the system. Therefore there should be changes made to these provisions for completing all the above in the given year itself. And, to ensure uniformity in this practice relating to audits of accounts,the C&AG of India be empowered to conduct the audit or lay down accounting standards for Panchayats.

This post ends here.


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The next post will cover:

Urban Local Government:
Municipal governance: main features,
structures, finance and problem areas;
74th Constitutional Amendment; Globallocal
debate; New localism; Development
dynamics, politics and administration with
special reference to city management.


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