Panchayati Raj and Decentralised Planning – UPSC Geography Optional & GS Paper II 2025–26

The Panchayati Raj system of India is the constitutional expression of participatory planning and grassroots democracy. With the enactment of the 73rd Constitutional Amendment in 1992, a formal framework of local self-government was established, highlighting the significance of decentralised planning and inclusive development. Decentralised planning is a process of adapting developmental policies and schemes to suit local needs, thereby facilitating responsive governance.

As India strides on its path of democratic deepening, Panchayati Raj Institutions (PRIs) are key in the delivery of schemes, empowerment of marginalized voices, and filling the governance divide between the state and the citizen. Yet, though constitutionally supported, the system struggles with autonomy, financing, and implementation ability. This article examines the evolution, constitutional mandate, institutional framework, and real-world functioning of Panchayati Raj and decentralised planning in India.

What Will You Learn from This Article?

This section lists the exact questions that this article will help you answer for UPSC Mains:

❓What is the historical background and constitutional framework of Panchayati Raj in India?
❓How did the 73rd Constitutional Amendment institutionalise decentralised governance?
❓What is the structure and functional mechanism of Panchayati Raj Institutions (PRIs)?
❓How does decentralised planning operate within the Panchayati Raj system?
❓What are the key challenges and implementation gaps in local self-governance?
❓How are digital innovations and recent schemes enhancing local governance capacity?

Following are genuine past year questions of UPSC Mains that have been asked on this subject:

• “The 73rd Constitutional Amendment Act is a milestone in democratic decentralisation. Discuss its impact on rural governance in India.” – GS II, 2020
   
• “Evaluate the role of Gram Sabha in strengthening the foundation of Panchayati Raj in India.” – GS II, 2018
   
• “The success of decentralised planning depends on effective devolution of powers to PRIs. Examine.” – GS II, 2016
   
• “How far do the recommendations of the Second Administrative Reforms Commission strengthen the functioning of local governments?” – GS II, 2015
   
• “‘Planning at the grassroots level has gained significance in India’s development journey.’ Elucidate with examples.” – GS II, 2014
   
• “Critically assess the challenges faced by Panchayati Raj Institutions in the implementation of development schemes.” – GS II, 2013

📚 Important Books on Panchayati Raj and Decentralised Planning (UPSC PSIR Optional & GS Paper II)

Important Points for Revision for UPSC Mains

This section provides factual bullet points ideal for quick revision. It includes definitions, constitutional articles, reports, schemes, and data.

• Article 40 of the Directive Principles directs the state to organise village panchayats.
   
• Balwant Rai Mehta Committee (1957) first recommended a 3-tier Panchayati Raj system.
   
• Ashok Mehta Committee (1977) proposed a 2-tier system and stronger district planning.
   
• The 73rd Constitutional Amendment Act, 1992 added Part IX and the Eleventh Schedule.
   
• Article 243G empowers PRIs with authority to plan and implement development schemes.
   
• The Eleventh Schedule lists 29 subjects for devolution to Panchayati Raj Institutions.
   
• Article 243ZD mandates the formation of District Planning Committees (DPCs).
   
• Gram Sabha is the foundational unit of direct democracy at the village level.
   
• Panchayati Raj is a three-tier system: Gram Panchayat, Panchayat Samiti, and Zila Parishad.
   
• State Finance Commissions (Article 243-I) recommend devolution of funds to PRIs.
   
• Planning Commission guidelines (2008) mandated bottom-up planning through PRIs.
   
• Rashtriya Gram Swaraj Abhiyan (RGSA) is a flagship scheme for PRI capacity building.
   
• Kerala's 'People’s Planning Campaign' (1996) is a leading model of decentralised planning.
   
• e-Panchayat project under Digital India aims to digitise PRI functions and records.
   
• The Punchhi Commission (2010) suggested strengthening PRIs to ensure cooperative federalism.
   
• The 2nd Administrative Reforms Commission (ARC) recommended greater fiscal autonomy to PRIs.
   
• Localisation of Sustainable Development Goals (LSDGs) is being implemented through PRIs.
   
• Capacity constraints, political interference, and elite capture hinder effective PRI functioning.
   
• 33% reservation for women (some states up to 50%) in PRIs was mandated by the 73rd Amendment.
   
• Schedule XI entries include agriculture, irrigation, health, education, and social welfare.
   
• PRIs receive funds from three sources: central/state grants, own revenues, and schemes.
   
• West Bengal and Karnataka have established strong district planning structures.
   
• Constitutional validity of the 73rd Amendment upheld in Kumar Padma Prasad v. Union of India (1992).
   
• The Ministry of Panchayati Raj oversees policy framework and implementation at the central level.
   
• Gram Sabhas approve village development plans under participatory governance models.
   
• Article 243N provided for continuity of existing Panchayats until new laws were enacted.
   
• The Twelfth Finance Commission recommended performance-based fund devolution to PRIs.

Institutional Framework of Panchayati Raj

The Indian Panchayati Raj is constituted as a three-tier model of local self-government:

1. Gram Panchayat at the village level
    
2. Panchayat Samiti at the block/intermediate level
    
3. Zila Parishad at the district level

Each of these tiers is elected directly by the public and comes under the direction of State Panchayati Raj Acts that take into account the constitutional framework delineated by the 73rd Amendment.

Role of Gram Sabha

Gram Sabha is the entire population of registered voters within a village and is a deliberative body. It sanctions development plans, scrutinizes expenditure, and holds the representative accountable, which is an important instrument for participatory democracy.

District Planning Committees (DPCs)

According to Article 243ZD, DPCs are obligated to coordinate plans drawn up by PRIs and municipalities. They differ in strength from state to state, with Kerala and Maharashtra showcasing strong planning, but others being hindered by coordination and availability of resources.

Functional and Financial Devolution

Despite constitutional backing, the devolution of powers remains asymmetrical across states. The 3Fs – Funds, Functions, and Functionaries – have not been transferred uniformly, affecting the autonomy of PRIs.

Functional Autonomy

Most PRIs lack real authority over subjects listed in the Eleventh Schedule. In many cases, parallel bodies (like line departments) bypass PRIs during implementation, diluting their effectiveness.

Financial Autonomy

PRIs are dependent on grants from the central government and state governments. While the State Finance Commissions suggest devolution, states procrastinate on implementation. PRIs also do not have much authority to generate own-source revenue and hence become dependent and functionally weak.

Challenges in Panchayati Raj and Decentralised Planning

1. Deficit Capacity

Panchayat functionaries in many places do not have administrative training and technical knowledge. This impacts planning, implementation, and fund management.

2. Bureaucratic Control

The Government of States pre-empts Panchayats through the bureaucratic route. District Collectors and State-level officials usually hold sway over decisions.

3. Elite Capture and Political Interference

Local elites, particularly sarpanch-pati (husband of elected woman sarpanch), drive decision-making, compromising on genuine representation.

4. Absence of Coordination

No defined demarcation of PRIs' work is created between parallel institutions, causing overlapping responsibilities.

5. Irregular Elections and Functioning

Some states delay PRI elections or appoint administrators, violating the spirit of decentralised democracy.

6. Ineffective Planning

Absence of data, trained human resources, and analytical tools leads to poor quality plans. Planning remains scheme-driven, not need-driven.

Key Committees and Their Contributions

The process of decentralised planning in India was influenced by a chain of path-breaking committees:

1. Balwant Rai Mehta Committee (1957)

• Recommended a three-tier system: Village, Block, District
   
• Emphasised democratic decentralisation and the role of Zila Parishad as the pivot
   

2. Ashok Mehta Committee (1977)

• Proposed a two-tier structure: Mandal and Zila Parishad
   
• Advocated constitutional recognition of PRIs and clear devolution of authority
   

3. Gadgil Committee (1984)

• Proposed district planning as the core for integrated rural development
   
• Highlighted the importance of people’s participation and transparency
   

4. Second Administrative Reforms Commission (ARC)

• Recommended regular elections, empowered State Finance Commissions, and transparency through citizen charters and e-governance
   

These committees laid the intellectual groundwork that culminated in the 73rd Amendment, giving PRIs a constitutional status and operational framework.

Role of the Ministry of Panchayati Raj (MoPR)

The Ministry of Panchayati Raj, formed in 2004, is the central coordinating body for policy and scheme implementation of Panchayati Raj. It has the major responsibility of:

• Monitoring the implementation of RGSA and e-Panchayat
• Publishing reports such as the Devolution Index, ranking state devolution of 3Fs
• Facilitating inter-state best practices and local governance innovations
• Coordinating with the Finance Commission for allocation mechanism of funds

The Ministry also collaborates closely with NITI Aayog, now having a central role in district-level data-driven planning and performance assessment.

Integration with Flagship Schemes

PRIs act as the implementing arms for several flagship development programmes:

• MGNREGA: Panchayats are responsible for approving, executing, and monitoring rural employment works
   
• Swachh Bharat Mission – Gramin (SBM-G): PRIs manage sanitation planning, awareness, and construction of toilets
   
• PMAY-G: Beneficiary identification and progress tracking are done through Gram Sabhas
   
• Jal Jeevan Mission: Village Action Plans are prepared and executed by PRIs
   
• Mission Antyodaya: PRI-level data is collected to identify development gaps and design composite village plans

This integration highlights the critical role of PRIs in delivering development at the grassroots.

Emerging Trends and Reforms

1. Digitalisation and e-Governance

The e-Panchayat project aims to computerise records, budgets, and service delivery systems. Applications like PlanPlus, PRIASoft, and ActionSoft are being implemented.

2. Capacity Building through RGSA

Rashtriya Gram Swaraj Abhiyan (RGSA) seeks to enhance capabilities of PRIs through training, infrastructure support, and institutional strengthening.

3. Localisation of SDGs

MoPR has aligned PRI development indicators with the Sustainable Development Goals (SDGs), encouraging local planning linked to global goals.

4. Women and Marginalised Participation

Reservation policies have enhanced the representation of women, SCs, and STs. However, empowerment remains limited without real transfer of authority.

5. Performance-Based Funding

Several Finance Commissions have linked fund allocation to performance indicators, encouraging accountability and efficiency.

Way Forward

• Strengthen State Finance Commissions to ensure timely and fair fiscal devolution.
   
• Enhance capacity-building initiatives tailored to the needs of different tiers of PRIs.
   
• Institutionalise Gram Sabhas with regular meetings, legal backing, and audit mechanisms.
   
• Clarify role of line departments vis-à-vis PRIs to eliminate overlapping jurisdictions.
   
• Leverage digital tools for planning, monitoring, and grievance redressal at the grassroots level.
   
• Promote social audits and participatory planning to build citizen trust.

This article offers a comprehensive overview of the Panchayati Raj and Decentralised Planning for UPSC aspirants. Also, download the Testbook App from the Play Store to get more details and unlimited study materials for the UPSC Prelims and Mains exams.