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15th Finance Commission Grants to Panchayati Raj Institutions: State-wise Details

UPSC / SSC current affairs note · Polity

PolityGovernance

Why in news

The PIB release provides state-wise details of grants released to rural local bodies under the 15th Finance Commission for 2021-26, highlighting un-released amounts due to non-fulfillment of eligibility conditions. It also presents comparative data on Gram Panchayat Development Plans uploaded on e-GramSwaraj portal and fund transfers via e-GramSwaraj-PFMS for Andhra Pradesh versus national averages, along with the release of a report on devolution to panchayats.

Background

The Finance Commission is a constitutional body whose recommendations, once accepted by the government and laid before Parliament, cannot be altered. Panchayats are a state subject under the Constitution, but the Ministry of Panchayati Raj promotes decentralized planning through the Gram Panchayat Development Plan framework.

Key facts

in5points

  1. Under the 15th Finance Commission (2021-26), grants to rural local bodies were allocated to 28 states including Andhra Pradesh.

  2. Un-released amounts indicate grants not released due to non-fulfillment of eligibility conditions by state governments/rural local bodies.

  3. Finance Commission recommendations, once accepted and laid before Parliament, cannot be changed.

  4. Gram Panchayats prepare annual Gram Panchayat Development Plans through a participatory process involving Gram Sabhas and upload them on e-GramSwaraj portal.

  5. e-GramSwaraj is a comprehensive digital platform for planning, budgeting, accounting, and monitoring of panchayat activities.

  6. Andhra Pradesh achieved over 99.8% upload of Gram Panchayat Development Plans in 2023-24, 2024-25, and 2025-26, compared to national averages of 97.25%, 97.35%, and 96.54% respectively.

  7. In 2025-26, Andhra Pradesh had 13,327 total gram panchayats, of which 13,320 (99.95%) uploaded plans.

  8. Online payments via e-GramSwaraj-PFMS in Andhra Pradesh: 13,095 panchayats in 2023-24 (Rs 968.711 crore), 13,002 in 2024-25 (Rs 1636.12 crore), and 13,041 in 2025-26 (Rs 1575.35 crore).

  9. The Ministry released a report 'Status of Devolution to Panchayats in States: An Indicative Evidence Based Ranking, 2024' in February 2025, assessing devolution effectiveness based on six dimensions: Framework, Functions, Finances, Functionaries, Capacity Enhancement, and Accountability.

  10. The devolution index range increased from 39.9% in 2013-14 to 43.9% in 2021-22.

Prelims pointers

  • 15th Finance Commission (2021-26)
  • e-GramSwaraj portal
  • Gram Panchayat Development Plan (GPDP)
  • PFMS (Public Financial Management System)
  • Devolution Index
  • Part IX of the Constitution (Panchayats)
  • Ministry of Panchayati Raj
  • Andhra Pradesh
  • Gram Sabha

Mains angles

  • Discuss the role of Finance Commission grants in strengthening Panchayati Raj Institutions and the challenges in fund utilization.
  • Critically examine the effectiveness of e-Governance initiatives like e-GramSwaraj in enhancing transparency and accountability in local governance.
  • Analyze the factors affecting devolution of powers and resources to panchayats, with reference to the Devolution Index report.