Lok Sabha Question No. 2828 (UNSTARRED), answered on 2026-03-10
Subject: Funds for Panchayats
Ministry: PANCHAYATI RAJ
Asked by: Shri Vishnu Dayal Ram, Shri Praveen Patel, Shri Vijay Baghel, Shri Krishna Prasad Tenneti, Shri Bhojraj Nag, Smt. Mala Rajya Laxmi Shah, Shri Bibhu Prasad Tarai, Shri Shankar Lalwani

## GOVERNMENT OF INDIA MINISTRY OF PANCHAYATI RAJ

## LOK SABHA UNSTARRED QUESTION NO. 2828

ANSWERED ON- 10.03.2026

## FUNDS FOR PANCHAYATS

## † 2828. SHRI BHOJRAJ NAG:

SMT. MALARAJYALAXMI SHAH:

SHRI VISHNU DAYAL RAM:

SHRI KRISHNA PRASAD TENNETI:

SHRI VIJAY BAGHEL:

SHRI PRAVEEN PATEL:

SHRI SHANKAR LALWANI:

SHRI BIBHU PRASAD TARAI:

## Will the Minister of PANCHAYATI RAJ be pleased to state:

(a) the assessment of the extent of devolution of Funds, Functions and Functionaries (3Fs) to Panchayats as of January 2026, State/UT-wise;

(b) whether the Ministry has instituted any mechanism for periodic review or monitoring of actual devolution;

(c) if so, the details thereof, including transfer of untied funds and posting of functionaries at the Panchayat level;

(d) the measures taken by the Ministry to encourage States to enhance the financial and administrative autonomy of Panchayats;

(e) whether any performance-based incentive, ranking or grant-linked mechanism exists to reward States demonstrating higher levels of effective devolution; and

(f) if so, the details thereof?

## THE MINISTER OF PANCHAYATI RAJ

## (SHRI RAJIV RANJAN SINGH)

(a) to (d) 'Panchayat', being 'Local Government', is a State subject and part of State List of Seventh Schedule of the Constitution of India. Panchayats are set up and operate through the respective State Panchayati Raj Acts which may vary from State to State, subject to the provisions of the Constitution. Article 243G of the Constitution empowers the Legislature of a State to make provisions, by law, for the devolution of power and responsibilities upon Panchayat at the appropriate level, subject to such conditions as may be specified, with respect to the preparation of plans for economic development and social justice and implementation of schemes for economic development and social justice as may be entrusted to them including those in relation to matters listed in the Eleventh Schedule to the

## ANSWER

Constitution. The State legislatures are to consider the 29 subjects listed in the Eleventh Schedule for devolution of power and responsibilities to Panchayats. Accordingly, all matters relating to Panchayats, including, assessment of the extent of devolution of Funds, Functions and Functionaries to Panchayats, periodic review or monitoring of actual devolution, transfer of untied funds, posting of functionaries at the Panchayat level and enhancement of the financial and administrative autonomy of Panchayats, fall within the purview of State Government.

However, the Ministry of Panchayati Raj reviews performance of Panchayats, from time to time, through studies, review meetings, field visits, video conferencing, Information Technology applications etc.

The Ministry has released a report titled 'Status of Devolution to Panchayats in States -An Indicative Evidence-Based Ranking, 2024' in February 2025 to assess the effectiveness of devolution and the role of local governments in strengthening grassroots democracy. This report presents the Devolution Index, which provides the overall scores and ranks for all States/Union Territories covered under Part-IX of the Constitution, based on six identified dimensions: Framework, Functions, Finances, Functionaries, Capacity Enhancement, and Accountability. This report reveals that the extent of devolution has increased from 39.9% to 43.9% between the period 2013-14 to 2021-22. Ranking of States/UTs in Devolution Index and Sub-indices is attached as Annexure-I.

The Ministry has implemented a Centrally Sponsored Scheme, namely the Revamped Rashtriya Gram Swaraj Abhiyan (RGSA), w.e.f. financial year 2022-23, with the objective of supporting Panchayati Raj institutions by imparting trainings to Elected Representatives and other stakeholders to develop leadership abilities, thereby enabling Gram Panchayats to function effectively across all States/UTs. Under the scheme, capacity building support is provided to elected representatives, functionaries, and other stakeholders of Panchayats under different categories, viz. basic orientation and refresher programmes, thematic interventions, specialized trainings and Panchayat Development Plan-related programmes, etc. The scheme also supports exposure visits to facilitate experiential learning and replication of best practices for strengthening Panchayat governance, as well as development of training modules and materials etc.

Further, to enhance skills and knowledge, a major step has also been taken to build capacity and train elected representatives and functionaries of Panchayats through Institutes of excellence such as IIMs/IITs under the Leadership/Management Development Program (MDP).

The Ministry of Panchayati Raj, in collaboration with IIM Ahmedabad, has also developed a training module on Own Source Revenue (OSR) to strengthen the financial selfreliance of Gram Panchayats. The module helps elected representatives and Panchayat functionaries understand how OSR is generated through tax and non-tax sources.

Additionally, the Ministry has launched a Specialized Training Module for the capacity building of Women Elected Representatives of Panchayati Raj Institutions. The focus of this training module is to build the capacity of Women Elected Representatives across different aspects of rural governance and enhance their knowledge and practical skills for the effective discharge of roles and responsibilities as elected representatives, thereby

promoting women-led governance. .

(e) & (f) No, Sir. However, the 16th Finance Commission (Financial Year 2026-31) has earmarked Rs. 87,048 Crores as Performance Grants. These Performance Grants have been divided in two components(i) Local Body Performance Grant, which shall be released depending on the quantum of Own Source Revenue generated and enhanced by the Rural Local Bodies and (ii) State Performance Grant, which shall be contingent upon the quantum of fund transferring by the State from its own resources.

***

## Statement referred to in reply to part (a) to (d) of Lok Sabha Unstarred Question No. 2828 for answer on 10.03.2026

## Ranking of States/UTs in Devolution Index and Sub-indices

| Ran                     | PDI                     | PDI                     | Framework               | Framework               | Functions Finances      | Kerala Tamil Rajasthan Odisha West Uttar Chhattisgarh Telangana Bihar Andhra Pradesh   | Kerala Tamil Rajasthan Odisha West Uttar Chhattisgarh Telangana Bihar Andhra Pradesh   | Functionaries           | Functionaries           | Capacity Building       | Accountability          | Accountability          |                         |                         |
|-------------------------|-------------------------|-------------------------|-------------------------|-------------------------|-------------------------|----------------------------------------------------------------------------------------|----------------------------------------------------------------------------------------|-------------------------|-------------------------|-------------------------|-------------------------|-------------------------|-------------------------|-------------------------|
| k                       | State                   | Scor e                  | State                   | Scor e                  | State                   | Scor e State                                                                           | Scor e                                                                                 | State                   | Scor e                  | State Scor e            | State                   | Score                   |                         |                         |
| General Category States | General Category States | General Category States | General Category States | General Category States | General Category States | General Category States                                                                | General Category States                                                                | General Category States | General Category States | General Category States | General Category States | General Category States | General Category States | General Category States |
| 1                       | Karnataka               | 72.23                   | Kerala                  | 83.56                   | Tamil Nadu              | 60.2 4 Karnataka                                                                       | 70.6 5 Gujarat                                                                         | 90.94                   | Telangana               | 86.19                   | Karnataka               | 81.33                   |                         |                         |
| 2                       | Kerala                  | 70.59                   | Maharashtra             | 74.74                   | Karnataka               | 57.6 2                                                                                 | 62.8 9 Tamil Nadu                                                                      | 84.25                   | Tamil Nadu              | 84.29                   | Kerala                  | 81.18                   |                         |                         |
| 3                       | Tamil Nadu              | 68.38                   | Karnataka               | 74.43                   | Odisha                  | 57.4 6 Nadu                                                                            | 55.7 8 Kerala                                                                          | 82.99                   | Gujarat                 | 83.96                   | Maharashtra             | 80.36                   |                         |                         |
| 4                       | Maharashtra             | 61.44                   | Haryana                 | 73.3                    | Rajasthan               | 56.1 3                                                                                 | 54.5 6 Karnataka                                                                       | 80.11                   | Goa                     | 77.7                    | Uttar Pradesh           | 76.07                   |                         |                         |
| 5                       | Uttar Pradesh           | 60.07                   | Madhya Pradesh          | 70                      | Kerala                  | 53.8 6                                                                                 | 53.5 7 Chhattisgarh                                                                    | 78.33                   | Andhra Pradesh          | 76.69                   | Tamil Nadu              | 71                      |                         |                         |
| 6                       | Gujarat                 | 58.26                   | Odisha                  | 69.2                    | Uttar Pradesh           | 46.8 9 Bengal                                                                          | 52.9 6 Bihar                                                                           | 75.13                   | Uttar Pradesh           | 74.44                   | Andhra Pradesh          | 60.49                   |                         |                         |
| 7                       | Rajasthan               | 56.67                   | Rajasthan               | 68.54                   | Maharashtra             | 46.5 2 Pradesh                                                                         | 51.7 6 Maharashtra                                                                     | 73.63                   | Maharashtra             | 73.35                   | Telangana               | 60.43                   |                         |                         |
| 8                       | West Bengal             | 56.52                   | Chhattisgarh            | 68.51                   | Chhattisgarh            | 42.3 9                                                                                 | 51.4 5 Andhra Pradesh                                                                  | 68.78                   | Karnataka               | 71.59                   | Chhattisgarh            | 58.17                   |                         |                         |
| 9                       | Chhattisgarh            | 56.26                   | Tamil Nadu              | 66.83                   | Gujarat                 | 41.2 3                                                                                 | 46.8 6 West Bengal                                                                     | 67.76                   | Kerala                  | 71.11                   | West Bengal             | 57.87                   |                         |                         |
| 10                      | Telangana               | 55.1                    | West Bengal             | 62.3                    | Madhya Pradesh          | 39.4 7                                                                                 | 43.8 6 Rajasthan                                                                       | 64.03                   | West Bengal             | 70.63                   | Odisha                  | 51.92                   |                         |                         |
| 11                      | Andhra Pradesh          | 54.43                   | Gujarat                 | 61.65                   | Telangana               | 38.7 7                                                                                 | 43.1 9 Uttar Pradesh                                                                   | 63.13                   | Madhya Pradesh          | 70                      | Bihar                   | 51.64                   |                         |                         |

## ANNEXURE-I

| 12                               | Madhya Pradesh                   | 50.94                            | Andhra Pradesh                   | 60.08                            | West Bengal                      | 33.0 7 Maharashtra               | 42.9 6 Madhya Pradesh            | 62.22                            |                                  | Rajasthan                        | 61.43                            | Gujarat                          | 47.9                             |
|----------------------------------|----------------------------------|----------------------------------|----------------------------------|----------------------------------|----------------------------------|----------------------------------|----------------------------------|----------------------------------|----------------------------------|----------------------------------|----------------------------------|----------------------------------|----------------------------------|
| 13                               | Odisha                           | 50.03                            | Uttar Pradesh                    | 54.64                            | Punjab                           | 31.9 7 Madhya Pradesh            | 42.3                             | 4 Telangana                      | 58.01                            | Bihar                            | 55.27                            | Haryana                          | 41.93                            |
| 14                               | Bihar                            | 48.24                            | Goa                              | 52.88                            | Andhra Pradesh                   | 30.5 Gujarat                     | 41.6                             | 3 Goa                            | 46.31                            | Chhattisgarh                     | 47.61                            | Rajasthan                        | 41.43                            |
| 15                               | Haryana                          | 39.33                            | Bihar                            | 49.76                            | Jharkhand                        | 27.5 6                           | Haryana                          | 40.3 8 Haryana                   | 38.48                            | Odisha                           | 43.43                            | Madhya Pradesh                   | 36.55                            |
| 16                               | Goa                              | 37.71                            | Punjab                           | 47.26                            | Bihar                            | 18.6 9 Punjab                    | 36.3                             | 6 Jharkhand                      | 27.83                            | Haryana                          | 35.35                            | Goa                              | 31.75                            |
| 17                               | Punjab                           | 29.34                            | Telangana                        | 45.35                            | Haryana                          | 16.8 2                           | Jharkhand                        | 30.0 5 Odisha                    | 27.42                            | Punjab                           | 26.34                            | Punjab                           | 24.87                            |
| 18                               | Jharkhand                        | 27.73                            | Jharkhand                        | 42.3                             | Goa                              | 6.63                             | Goa                              | 26.8 8 Punjab                    | 8.2                              | Jharkhand                        | 24.72                            | Jharkhand                        | 16.47                            |
| Northeastern / Hilly Area States | Northeastern / Hilly Area States | Northeastern / Hilly Area States | Northeastern / Hilly Area States | Northeastern / Hilly Area States | Northeastern / Hilly Area States | Northeastern / Hilly Area States | Northeastern / Hilly Area States | Northeastern / Hilly Area States | Northeastern / Hilly Area States | Northeastern / Hilly Area States | Northeastern / Hilly Area States | Northeastern / Hilly Area States | Northeastern / Hilly Area States |
| 1                                | Tripura                          | 57.58                            | Uttarakhand                      | 70.95                            | Sikkim                           | 42.5 9                           | Tripura                          | 59.1 6 Himachal Pradesh          | 70.06                            | Himachal Pradesh                 | 83.68                            | Tripura                          | 70.69                            |
| 2                                | Himachal Pradesh                 | 53.17                            | Tripura                          | 66.5                             | Assam                            | 28.6 6                           | Himachal Pradesh                 | 48.4 1 Assam                     | 65.12                            | Tripura                          | 76.82                            | Assam                            | 57.14                            |
| 3                                | Uttarakhand                      | 49.11                            | Sikkim                           | 65.27                            | Himachal Pradesh                 | 23.0 1                           | Uttarakhand                      | 47.11 Uttarakhand                | 60.49                            | Assam                            | 71.96                            | Uttarakhand                      | 52.72                            |
| 4                                | Assam                            | 49.06                            | Himachal Pradesh                 | 62.22                            | Tripura                          | 21.5                             | Sikkim                           | 43.5 Tripura                     | 52.22                            | Uttarakhand                      | 56.02                            | Himachal Pradesh                 | 39.41                            |
| 5                                | Sikkim                           | 43.81                            | Assam                            | 54.04                            | Uttarakhand                      | 16.6 8                           | Assam                            | 34.0 6 Sikkim                    | 31.42                            | Sikkim                           | 53.23                            | Sikkim                           | 34.94                            |
| 6                                | Arunachal Pradesh#               | 17.96                            | Arunachal Pradesh#               | 41.5                             | Arunachal Pradesh#               | 12.7                             | Manipur#                         | 13.1 7 Manipur#                  | 21.4                             | Arunachal Pradesh#               | 37.4                             | Manipur#                         | 28.75                            |
| 7                                | Manipur#                         | 17.13                            | Manipur#                         | 34.05                            | Manipur#                         | 11.23                            | Arunachal Pradesh#               | 6.83 Arunachal Pradesh#          | 5.74                             | Manipur#                         | 3.75                             | Arunachal Pradesh#               | 22.56                            |
| Union Territories                | Union Territories                | Union Territories                | Union Territories                | Union Territories                | Union Territories                | Union Territories                | Union Territories                | Union Territories                | Union Territories                | Union Territories                | Union Territories                | Union Territories                | Union Territories                |

| 1   | Jammu Kashmir                        |   and 27.85 | Andaman & Nicobar Islands            |   55.21 | Jammu and Kashmir                     | 11.88                          | Puducherry       | 16.1 6 Lakshadweep #                      | 39.53   | Jammu Kashmir                        | and 55.08   | Andaman Nicobar Islands            | &   |   45.73 |
|-----|--------------------------------------|-------------|--------------------------------------|---------|---------------------------------------|--------------------------------|------------------|-------------------------------------------|---------|--------------------------------------|-------------|------------------------------------|-----|---------|
| 2   | Andaman & Nicobar Islands            |       27.15 | Lakshadweep#                         |   31.42 | Ladakh                                | 11.08 Jammu Kashmir            | and              | 13.2 9 Jammu and Kashmir                  | 36.97   | Andaman Nicobar Islands              | & 54.82     | Jammu Kashmir                      | and |   39.76 |
| 3   | Lakshadweep#                         |       18.32 | Jammu and Kashmir                    |   23.07 | Lakshadweep #                         | 10.3 6 Andaman Nicobar Islands | &                | 9.09 Dadra & Nagar Haveli and Daman& Diu# | 31.69   | Ladakh                               | 29.32       | Puducherry                         |     |   29.33 |
| 4   | Ladakh                               |       16.18 | Ladakh                               |   22.21 | Puducherry                            | 4.63 Dadra Nagar and Diu#      | & Haveli Daman & | 5.45 Ladakh                               | 25.25   | Lakshadweep #                        | 15.18       | Lakshadweep #                      |     |   28.13 |
| 5   | Puducherry                           |       16.16 | Dadra & Nagar Haveli and Daman &Diu# |   22.06 | Andaman & Nicobar Islands             | 4.5                            | Lakshadweep#     | 3.99 Puducherry                           | 21.49   | Puducherry                           | 13.75       | Ladakh                             |     |   27.43 |
| 6   | Dadra & Nagar Haveli and Daman &Diu# |       13.62 | Puducherry                           |    9.31 | Dadra & Nagar Haveli and Daman & Diu# | 0                              | Ladakh           | 0 Andaman Nicobar Islands                 | & 20.94 | Dadra & Nagar Haveli and Daman& Diu# | 8.57        | Dadra Nagar Haveli and Daman& Diu# | &   |   24.91 |
|     | National Average                     |       43.89 |                                      |   54.29 |                                       | 29.1 8                         |                  | 37.0 4                                    | 50.96   |                                      | 54.63       |                                    |     |   47.51 |

Source: Report titled 'Status of Devolution to Panchayats in States - An Indicative Evidence-Based Ranking, 2024'

Note: #States for which previous data is used.

*Provisions of Part IX (Panchayat) do not apply to these states.

** Panchayats are not operational in these UT.