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11.0 Learning Outcome

11.1 Introduction

11.2 Importance of Decentralisation

11.3 Impact of Decentralised Development
11.3.1 Political Decentralization
11.3.2 Functional Decentralisation
11.3.3 Financial Decentralisation
11.3.4 Administrative Decentralisation

11.4 Suggestions for Strengthening Decentralised Development

11.5 Conclusion

11.6 Key Concepts

11.7 References and Further Reading

11.8 Activities


After studying this unit you should be able to:

• explain the importance of decentralization;

• discuss the impact of decentralized development;

• highlight the constraints of decentralized development; and

• identify certain reforms for making decentralized development a success.


Decentralization is recognized as a largely positive aspect of political development. It is an ideological principle associated with objectives of self-reliance, democratic decision- making, popular participation in government, and accountability of public officials to citizens. Thus, decentralization is a political decision, and its implementation, a reflection of a country’s political process.

As regards decentralized development, it involves the establishment of machinery for planning, economic growth and mobilizing and allocating resources to expand national income. It entails arousing people’s aspirations and allowing and encouraging people to meet their own aspirations. It naturally involves achievement of progressive political, economic and social objectives (Mishra, Sweta; 1994: 3).

In this unit we will be discussing the impact of decentralised development and also highlight the various measures for achievement of decentralised development.

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Development Administration is basically oriented towards speedy socio-economic transformation. Hence, all throughout the developing world there is universal concern now to design new forms of administration to match the needs of development. The realization that the centralized, bureaucracy – dependent system of planning and implementation has failed to deliver to much of the developing world, as well as the fact that common citizens should have a say in the decisions that affect their lives, has brought decentralization center – stage within development discourse (Mohmand, Shandana Khan; 2005: 278). Decentralization has been looked at as a singularly useful mode of administration to deliver the public services from convenient local centers close to the clients’ locality. Bringing administration to the doorstep of the citizen and establishing a direct relationship between the client and the administration have been the driving force behind decentralization in most of the developing countries. By bringing governance, decision making and implementation of basic services closer to the people, decentralization promises both greater efficiency and a more responsive government based on more accurate information. The proximity between people and state can foster greater understanding and a better perception of the needs at the local level.

The urge for decentralization has come from many sources. Firstly, it has been prompted by the need to deliver the basic public goods like food, housing, water from local units of administration as soon as possible. Secondly, most people in the developing countries live in rural areas which are away from the national capital located in distant urban area. Administration has to “penetrate” the rural areas and link these up with the nation as a whole. Thirdly, in many countries sociological diversities manifest themselves in ethnic, linguistic and religious differences. Administration needs to be decentralized in response to regional diversities. Fourthly, regional and local resources can be utilized for area development purposes, only if administration would move out to the regions and localities. Decentralization, therefore, facilitates local planning and development with the help of local resources. Fifthly, decentralization has its own value in political and administrative terms. Politically, local participation in development activities, with intensive responses paves the way for meaningful articulation of local demands. Planning, thus becomes much more realistic and receives ready political support. From the administrative point of view, local capability to govern local areas increases through sustained participation in local decision- making. Decentralization is expected to release local energies and enlist local support for development activities. In the process, the local community can steadily attain political and administrative maturity.

Thus we see that decentralization has the capacity to bring governance processes closer to the people and to create both representative and participatory forms of governance. It has the potential to allow citizens to play a direct role in decision making and implementation at the local level, resulting in greater transparency of decision-making processes and greater accountability of elected officials to the general populace.


A remarkable change in the democratic structure of governance is underway in India following the 73rd and 74th Constitutional Amendment Acts. The Acts were the culmination of a historic political move towards deepening democracy and advancing development through decentralization by making Panchayati Raj Institutions (PRIs) and Municipal

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Institutions mandatory. The Acts aimed at building up local bodies as institutions of self- government. The decentralization process has now given rural and urban local bodies an opportunity to assume greater responsibility for rural and urban management. The installation of representative local governments across the country, apart from political decentralization, also enables, to a substantial extent, a multi level self-governance in the cities and villages of the country (Sivaramakrishnan, K.C., 2006: vii).

The Amendment Acts have provided a broad structure for organizing rural and urban governance. The rural and urban local bodies are expected to assume a larger role in planning, financing and management of rural and urban areas.

Apart from these, decentralized development has its impact on all the dimensions viz., political, administrative, functional and financial. It has both its positive and negative impacts. These impacts are discussed in the succeeding pages.

11.3.1 Political Decentralization

Under political decentralization, the political and constitutional status has been given to local institutions, both rural and urban, and elected members through the 73rd and 74th Constitutional Amendment Acts. The Acts have empowered the local institutions and has opened avenues for facilitating social mobilization process at the grassroots level. They have provided a framework for decentralization at three levels viz., district, block and village, by providing a uniform three tier structure for rural and urban areas as also a uniform term of five years for each tier. The uniform tenure ensures that the local bodies do not remain in a state of suspended animation for long. If at all the local bodies are superceded before the completion of their tenure, provisions for fresh elections within a period of six months, has been provided for in the Acts. Thus, the local bodies can remain suspended only for a period of six months in the new dispensation. This is a very positive impact of decentralized development.


The impact of direct election of the chairperson of the Gram Panchayat was good. It has been observed that such a chairman is a strong executive head and at the same time is also directly accountable to the people. The field experiences from Andhra Pradesh and other states reveal that the direct election of the chairpersons, i.e. the Sarpanch, of the Gram Panchayat tends to promote the emergence of the people not only for his actions but also for performance of the Gram Panchayat as a whole.

Whereas, on the other hand, in states like Karnataka, the chairman is indirectly elected from amongst the elected members of the Gram Panchayat. It is felt that direct election of the chairman leads to chairman becoming a dictator, taking unilateral decisions and becoming partisan to a particular group or a community (Sharma, P.R. and Joshi, R.P.;
2004: 149). Hence, the state opted for indirect election of the chairman.


Another area of decentralization, where its impact can be assessed, is the participation of SCs/STs, OBCs and women in PRIs and ULBs. Some three million people have been elected to local councils at all three levels of local government, including one million women and a large number of SCs and STs. The very presence of large numbers of poor people in local councils, mainly on account of seat reservations, is a very significant development in the local political landscape of most parts of rural India where they were

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previously excluded from public life and political participation (Robinson, Mark; 2005:17). Vastly increased numbers of elected representatives have provided new opportunities for political representation at the local level, especially for women and marginalized social groups. The reservations have provided under-privileged groups with increased visibility and an opportunity to influence local affairs. There are many instances where women have managed to generate modest local development dividends by marshalling financial resources and lobbying bureaucrats and politicians at higher levels (Ibid: 20).

The most positive impact of reservation for women is the recognition of the value of education by women. New panchayat/municipality members experienced many handicaps due to lack of education. This made them keen to educate their daughters. In the near future, female literacy and education will definitely improve (Baviskar, B.S.; 2005: 340).

Besides, the status of women in their families has been enhanced due to their participation in the public sphere of panchayats and municipalities. Some of the women representatives have highlighted that their husbands have stopped battering them and many have even given up drinking. As a result, they have become more confident and there is significant improvement in their self-image. Even the other village/town women have started coming out of their homes. They approach the women leaders with petitions about family conflicts, disputes over land, employment and housing.

Studies from Karnataka indicate that women have made some headway in gram panchayats by using reserved seats as a vantage point to shape local development priorities. Scattered evidence suggests that individual women panchayat leaders have registered significant success in securing government resources for sanitation and street lighting, local infrastructure in the form of village roads and community buildings (such as schools and childcare centers), and ensuring that public servants such as school teachers carry out their designated responsibilities. These modest but important gains demonstrate the ability of women to use the elected office for the benefit of the community and strengthen their legitimacy as elected representatives (Robinson, Mark; 2005: 21-22).

Many such success stories about the effective participation of women have already been discussed in detail in Unit 5.

Reservation of seats for SCs and STs has provided them a guaranteed level of representation and share of leadership positions. It has ensured the access of SCs and STs to rural/urban power structure thereby legally enlarging the social base of the system. Now the people from SC/ST community are in a position to air their grievances and get them cleared through process of participatory decision making process. Some elected presidents from these communities have been able to use their new found authority to significant effect by bringing in more resources and challenging caste discrimination in village affairs (Ibid.).

The reservation has thus enlarged the participatory process at the local level because of mandatory participation of women and weaker sections in these bodies. Besides facilitating greater degree of communication among the rural and urban people irrespective of their caste or gender affiliation, it has also opened vistas of social change thereby accepting the process of equity with social justice.

On the other hand, the reservation of seats for SCs/STs and women has its negative impact too. Elite dominance continued to prevail in most panchayats/municipalities. As a result, the traditional caste leaders and landed elites dominated decision making by proxy

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or manipulation during the first phase of the functioning of PRIs and ULBs. Outspoken SC and female representatives have often had to contend with violence, ostracism or non- cooperation from dominant interests (Ibid: 21).

There have been repeated cases of violence directed at SC representatives, and a series of publicized murders. There are numerous instances (already discussed in detail in Unit
5) where women elected to local office have faced abuse and violence and in some cases have been murdered.

Role of Gram Sabha

The Gram Sabha, corner stone of the entire scheme of democratic decentralization, was non functional prior to the 73rd Constitutional Amendment Act. Even after the Amendment, it has not been activated to the desired extent. Realizing the importance of this institution at the local level, the Government declared the year 1999-2000 as the “Year of Gram Sabha”. As a result, the Gram Sabhas started meeting on specified dates (26th January,
1st May, 15th August and 2nd October) and the local people came in large numbers to attend the meetings in States like Rajasthan, Madhya Pradesh, Kerala, etc.

In Rajasthan the general masses who elect their Gram Panchayat representatives have become aware of their sovereign power to control the governance and functioning of an elected body like Gram Panchayat. Whenever the meetings of the Gram Sabha is convened for the selection of beneficiaries under various programmes of the Government, it is well attended by the villagers. Now they are very cautious that there should not be any favour and partisanship in selecting the beneficiaries. The educated youth of the area has awakened and now they are asking the president, the head of the village panchayats, that how they have utilized the resources or finances coming to them either from State or the Central Government. With the passing of the Right to Information Act, the people now know that they have a right to ask for a copy for any document relating to the affairs of the village from the Gram Panchayat and thereby bringing transparency in the working of Gram Panchayat (Sharma, Ashok; 2003: 755).

In Kerala detailed development plans are developed through open assemblies at the village-level (Gram Sabhas) and are only sent upwards for finalization after the needs and priorities at that level have been openly debated. These meetings, where plans developed at the village level are put to vote, are open to everyone in the village, and the plans developed are comprehensive with both horizontal and vertical linkages of projects and other activities. Besides, the Gram Sabha also reviews expenditure details and implementational status of projects agreed upon in the previous year. As a result, the Gram Sabhas become directly accountable to the people and there is little space for misuse of funds (Mohmand, Shandana Khan; 2005: 283).

The experience of people’s plan through Gram Sabha infused enthusiasm among people who have been taking very active part in Gram Sabhas specially because plan funds to the tune of 40-45 lakhs were placed at the disposal of every panchayat to sanction need based proposals given by Gram Sabha whereby the aspirations of local people were fulfilled.

The examples of Kerala and Rajasthan clearly prove that the Gram Sabhas have started functioning thereby enlarging people’s participation. In various part of the country the anger of the public has outburst in the meetings of Gram Sabha and this has compelled the local leadership and local bureaucracy to satisfy the eager voices in these meetings

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(Sharma, Ashok; 2003: 756). This is a very positive impact of decentralized development. Strengthening of Gram Sabhas has resulted in greater involvement of people besides facilitating transparency and accountability at the village level besides propelling the process of consultation and participation (Jain, S.P.; 2003: 605). Though a lot has to be achieved but still a beginning has been made. The effective functioning of Gram Sabha should not be restricted to few states. Rather it should spread across the country only then the real fruits of decentralization can be achieved.

Role of the Ward Committees

The provision for ward committees was made to ensure some proximity between citizens and their elected representatives. Since many aspects of day-to-day civic life could be addressed in a better way at the neighbourhood level, it was necessary to have the ward committees, which could serve as effective forums for interaction with elected ward councilors.

The ward committees have been constituted only in eight States (Andhra Pradesh, Karnataka, Kerala, Madhya Pradesh, Maharashtra, Tamil Nadu, West Bengal and Delhi). Out of these States, it is only in Kerala that the ward committees have been constituted in all the ULBs. Excepting Kerala, and to some extent West Bengal, none of the State Governments have shown any enthusiasm in setting up the committees.

In Kerala, the participation of the people’s representatives has been made broad-based by listing various categories of civil society organizations, professionals and neighbourhood groups. It serves as a plantform for seeking and obtaining some accountability from the councilor (Sivaramakrishnan, K.C.; 2006: 23). In the case of Karnatakas and Kerala, citizens can have access to the minutes of the committee meetings. In Kerala, the citizen’s groups participating in ward committee meetings ask question on the progress made in redressal of complaints and civil works.

Thus, we see that the ward committees in Kerala have contributed greatly to ensuring participation of people in governance. One of the ward committees installed rainwater harvesting structures in the ward to tackle the problems related to scarcity of water during summer. Besides, the ward committees are looking after solid waste management. The ward committees took the initiative to appoint workers to collect solid waste from households to prevent accumulation of garbage on roadsides (Ibid: 185). All this has led to greater decentralization, accountability, transparency and people’s participation. It is a very encouraging and positive impact of decentralization.

The ward committees have demonstrated their potential to emerge as platforms for citizen’s participation and their interaction with elected representatives. However, this potential has been achieved only to a limited extent. Unless and until the rest of the States follow in the footsteps of Kerala, their real impact cannot be visible. The negative side of the ward committees is that the municipal leadership view it as an incursion into their domain and the skepticism of the people in looking up to these committees as a forum for their participation (Ibid: 49).


Accountability of local institutions is a precondition for creating trust in the minds of the people. The expectations of the people from the government in general and the PRIs/ ULBs in particular do not remain confined only to the prevention of abuse of power or dishonesty in the use of public resources. Rather they expect their government to be

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responsive to their needs, wishes, and preferences. As such, the public agencies in general and the local government institutions in particular must remain accountable for being responsive to the needs of the citizens they serve (Ghosh, Buddhadeb; 2005: 257).

The provisions like display of all vital information pertaining to development projects, especially receipt of funds and how they are being spent, in the Panchayat/Council offices or on a prominent board outside the school, for the information of the public, ensures the accountability of the local bodies. Similarly, the provision to obtain photocopies of documents pertaining to development projects as also matters of general public interest by paying a nominal charge, too ensures accountability and transparency.

These provisions have a direct impact on the citizens in the sense that now they can keep a check on the functioning of the local bodies. The experience gained from the experiment of Jan Sunvais (Public Hearings) in Rajasthan is a proof that the citizens can no longer be befooled and the funds be misutilized. Under the Jan Sunvais, the village people demand for all documents related to works undertaken with public funds. If there are discrepancies, they are questioned by the village people. The Sarpanchas in several villages have paid up the recoveries demanded by the people and Jan Sunvais have been highly effective in mobilizing villages on the issues of transparency and accountability (Background Paper, Shimla; 1999: 29). This is a very positive impact of decentralization. It is hoped that in near future, the local institutions will reconcile the ethical values of fair play and integrity, democratic values of rule of law, participation, responsiveness, and transparency, and corporate values of providing services in an efficient and effective manner (Ghosh, Buddhadeb: 2005: 273) and will ultimately achieve the goal of decentralization, which we have been striving for too long.

11.3.2 Functional Decentralisation

It refers to transferring subject specific/functions to the local tiers. The functions prescribed under 11th (29 subjects) and 12th Schedules (18th subjects) are to be transferred to panchayats and municipalities respectively.

Transfer of Functions

The full transfer of functions under 29 and 18 subjects have not taken place in almost all the States. Even, in the functional terms, the subjects under basic needs (like primary education, health, agriculture, veterinary, irrigation etc.) have not been transferred. Also, inter-tier demarcation of functions has not been carried out resulting, into overlapping of functions and conflicts in certain cases. Similarly, subject-specific responsibilities have not been assigned to each tier (Gupta, D.N.; 2004: 225). As such, the local bodies are not in a position to take up the responsibilities under various subjects.

The performance of some States is better than the others. While some States have yet to start. Very limited action in this regard has been taken by the States. But still the impact of decentralized development is visible. The functional devolution has essentially galvanized the local bodies from the stage of dormancy to performance. A challenge has been placed on these bodies to perform (Jain, S.P.; 2003: 605). Though there are variations across the states with regard to functional devolution and performance of these bodies, the overall results can be seen in the positive direction. The local bodies are involving themselves in the implementation of poverty alleviation programmes, besides the schemes under social development sector. This has paved the way for greater people’s participation which has been lacking so far (Ibid: 606).

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11.3.3 Financial Decentralisation

Under financial decentralisation, powers with regard to taxation, funds and expenditure are devolved upon local bodies in order to improve their financial position and also to give them financial autonomy for planning and implementation as per local needs.

Devolution of Funds

Like devolution of functions, the devolution of funds too has not taken place in most of the States. Financial decentralisation has progressed to a very limited extent as resource flows are determined by the implementation guidelines for state and central government anti-poverty schemes. Hence, financial autonomy to the PRIs and the ULBs have been granted in very few States. Despite that, the impact of decentralisation can be seen on the financial health of the local bodies. The constitution of State Finance Commission (SFC) and provision for effective local tax administration in the Act, have no doubt improved the financial health of the local bodies. Similarly, provisions like auctioning the Gram Panchayat financially beneficial properties like fisheries, ponds, pastures and others, have also improved the financial position of the local bodies. In the past, lack of financial resources made these institutions totally handicapped and did not allow them to fulfil the hopes and aspirations of the people (Mishra, S.N.; 2005: 73).

The impact of decentralisation in the financial sphere can be witnessed from the fact that under the Terms of Reference (TOR) of Eleventh Finance Commission (EFC), for the first time the Presidential Order required a Finance Commission to make recommendations regarding the transfers of fund to the States which further pass on to the local Governments for augmenting of resources of these bodies. Accordingly, the EFC recommended a grant of Rs. 1600 crore for the Panchayats and Rs. 400 crore for the Municipalities for the period of five years (2000-01 to 2004-05). Similarly, the Twelfth Finance Commission (TFC), too recommended a sum of Rs. 20,000 crore for the Panchayats and Rs. 5000 crore for the Municipalities for the period 2005-2010, as grants-in-aid to augment the consolidated fund of the States to supplement the resources of the local bodies. This is a welcome step in the direction of making the local bodies financially independent.

11.3.4 Administrative Decentralisation

Administrative decentralisation involves placing planning and implementation responsibilities with the local bodies and assigning the roles and responsibilities to functionaries and elected members.

The District Planning Committees

A planning body has been given constitutional status for the first time as per the provisions of Article 243 ZD. The new dispensation has given a fillip to the institution building efforts for shouldering the responsibility for plan formulation which is an important prerequisite for micro-level planning (Singh, S.K.; 2005: 163). It has emerged as a strong body outside the panchayat and municipal system, as can be seen from the experiences of Madhya Pradesh where DPC has been made as Zila Sarkar, that is, district government.

The Kerala experience proves that it has gone much ahead in carrying out decentralized planning process or ‘planning from below’. Under this process, people are to be mobilized through the local bodies in all stages of development planning from formulation, implementation to maintenance. The primary objectives of people’s campaign for Ninth Plan is “to ensure that the Panchayat/Municipal bodies prepare and prioritize the shelf of

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integrated schemes in a scientific manner”. With this campaign, for the first time in the history of our country there has been a process of genuine planning process from below. As a result of this people’s campaign, maximum participation at every stage of the planning process from proposals to implementation has been ensured. The campaign has also successfully contributed towards strengthening people’s unity in development action and has generated a new development consciousness in the State (Biju, M.R.; 1998:
146). This is a very positive impact of decentralized development as decentralized planning has heralded a new era in people’s participation. This participation should extend to conceptualization, formulation, implementation, monitoring and evaluation of locally relevant plans by local people (Mishra, S.N. and Mishra, Sweta; 2002: 57).

Role of Bureaucracy

The local bodies can function effectively if there is facilitative functional relationship in terms of coordination, cooperation between the elected and official functionaries. But in the new scheme of decentralization, the State Acts have given ample scope for the State Governments, through bureaucracy, to exercise control, supervision, powers of dissolution and of annulling resolutions. As a result, in most states, the bureaucracy had been found to be in a prime position over the elected leadership.

The above provisions have a very negative impact leading to recurring confrontation figuring between district panchayat leadership and administrative leadership. Since there is no clear cut demarcation of powers, functions and responsibilities between panchayat functionaries, particularly between the presidents and chief executive officers of the panchayats, a lot of confusion prevails over the exercise of these functions. Notwithstanding the confusion on paper, the bureaucracy, in most of the States, except in States like Karnataka, Kerala and West Bengal, is found to be a dominant partner in decentralized governance. Bureaucrats in local governments, especially gram panchayat secretaries, continue to exercise considerable influence over elected representatives. Consequently, though panchayats have vertical linkages (organizational and functional) between them and the functionaries, there appear to be gaps as far as ‘role perception’, ‘role appreciation’ and ‘role performance’ is concerned (Chandrashekar, B.K.; 2000: 12). This is not a good sign as the real aim of decentralized development is being thwarted.

From the above analysis it becomes clear that political decentralization has largely been successful. So far as functional, financial and administrative decentralization is concerned, it has achieved partial success. The percentage of political participation has increased, reflected in active campaigning, high levels of voter turnout, and heightened engagement with local officials and elected representatives. All these have helped in invigorating local democracy.

The provisions for regular local elections, affirmative-action measures designed to bring women and scheduled castes and tribes into public life, and strengthening the oversight and accountability functions of gram sabhas, have deepened local democracy by broadening political participation and diversifying representation. The very presence of large number of poor people in local bodies, mainly on account of seat reservations, is a very significant development in the local political landscape of most parts of rural/urban India where they were previously excluded from public life and political participation (Robinson, Mark;
2005: 17).

On the other hand, there are certain issues which are still creating hurdles in achieving the goal of decentralized development. Issues like dominance of bureaucracy, the role of

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District Rural Development Agency (DRDA), the non-functional character of the DPC, devolution of funds and functions needs immediate attention if we really want to see the impact of decentralized development.


As local self-government bodies have come into existence throughout the country their functioning has come under scrutiny. A congenial climate for taking governance to the doorsteps of the people is slowly being created. However, a lot remains to be done. Accordingly, in the succeeding pages, some suggestions are provided for strengthening decentralized development.

Panchayats and Municipalities can fulfil their responsibility as institutions of self-government only, if devolution is patterned on a nexus between the three Fs: functions, functionaries and finances. The closing down of the line departments and the transfer of staff to the administrative and disciplinary control of the panchayats and the municipalities should be done. In the absence of such effective devolution of functionaries with functions, a kind of dyarchy will keep on operating at the ground level which is detrimental to good governance and extinguishes all possibility of effective self-government (Aiyar, Mani Shankar; 2005: 65).

The Gram Sabhas constitute the bedrock of the Panchayati Raj system in India. Hence, unless the Gram Sabhas meet regularly, we cannot ensure direct accountability of the elected representative to the electorate. There should be wide publicity for the Gram Sabha meeting through local media and local communication methods like announcement on loudspeakers, beating of drums, distribution of pamphlets, etc.

The people attending the Gram Sabha meetings should be encouraged to express their opinion freely so that no single group dominates the proceedings. People should be educated regarding the powers and functions of Gram Sabha. The NGOs active in the field of rural development must be encouraged to educate the people so that they can participate actively in the Gram Sabha meetings (Meenakshisundaram, S.S.; 2005: 427). Apart from the NGOs, the teachers in village schools may be assigned the function of educating the people about the powers and functions of Gram Sabha. The village school should serve as a resource center to the members of Gram Sabha (Sharma, Ashok; 2003:

In order to ensure transparency and accountability, certain measures should be taken up. For example, a register containing the details of all development works should be maintained. It should contain information like assets created, work done, cost and dates of their completion etc. This register should be made available to the members of Gram Sabha/Gram Panchayat on demand. This will help in scrutinizing the works completed. The information regarding income and expenditure of the Gram Panchayat should be provided to the Panchas by the Sarpanch. Complaints regarding manipulation of funds, should be enquired into and those found guilty should be punished (Singh, Mohinder;
2003: 770).

Besides these, the NGOs operating in the respective areas of the Gram Panchayat should be involved to ensure transparency. Whenever any new scheme/programme is introduced the block and district level officials should visit the village and brief the villagers about the

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objectives, procedure and types of benefits that are likely to accrue under the scheme/ programme. The functionaries should directly contact the villagers for seeking and giving information. This will create awareness regarding schemes of rural development as also ensure interaction among the people (Ibid: 771). Finally, the Gram Panchayat as a whole should be made more responsive and accountable to the concerned Gram Sabha. All these will lead to the transparent functioning of the Gram Panchayats.

The decentralization process cannot be complete unless proper planning is done. Though the District Planning Committees have been constituted in most of the states, yet desired result have not been achieved. Accordingly, it is suggested that the union governments accord the highest priority to the constitution and functioning of the DPC with a view to making plans prepared by DPCs the basis for the preparation of the Five Year Plans (Aiyar, Manishankar; 2005: 79).

The prime focus of the DPC should be guiding and facilitating panchayats and municipalities in formulating their plans. It should also resolve policies, priorities, programmes and strategies for the overall development of the district in order to ensure maximum and prudent utilization and exploitation of available natural, human and other resources in the area. The DPC should convene a general body meeting of all panchayat and municipal representatives of the district to approve and endorse the plan so that due importance is accorded to such district plans in the planning process at higher levels. Only after this, the development plan of the DPC should be forwarded to the State Government.

Apart from these, the DPC should organize training programmes to impart technical skills to personnel engaged in the plan formulation at the lower level bodies. This training will enhance the capability of personnel leading to improvement in the quality of planning.

So far as financial devolution is concerned, it is suggested that the recommendations of the State Finance Commission (SFC) for strengthening of the financial position of rural and urban local bodies should be implemented in toto. The necessary sanction with regard to the release of funds must be done in time. Apart from this, some kind of link up between the recommendations of the Central Finance Commission and the SFCs should be evolved so that the PRIs and the ULBs do not remain dependent on funds for specific schemes but also get some “untied funds” for taking up activities which meet the local requirements (Jain, S.P.; 2002: 604).

It is further suggested that the taxing power and auctioning power should in the hands of the PRIs and the ULBs and collection of taxes and auction money should be done by local level bureaucracy. This strategy may come handy in timely collection of taxes and other means of augmenting of finances of the local bodies (Mishra, S.N.; 2005: 75). Apart from this, it sis further suggested that in the initial stage provision for matching grant, like Maharashtra and Gujarat, may also help enthuse the local bodies to take up more and more developmental activities and getting more and more fund from the State Exchequer.

Reservation has opened the door to revolutionary changes of a political, social and cultural nature. It has empowered the women, SCs and STs. However, the real and genuine empowerment is still awaited. In order to achieve this, reservations for women should extend to at least two terms for any constituency. This way they will be able to enjoy the benefit of their past good work (which they might have done in the first term) while contesting the election for the second term.

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It is further suggested that no-confidence motions against women chairpersons be allowed to be tabled only once every two years, no oftener, in order to end the widespread harassment of women chairpersons through threats of no-confidence motions, which are very much in vogue with respect to women than men chairpersons. Similarly, if a women chairperson or member is removed for any reason whatsoever, she must be replaced by another woman of the same category, not by a man, whether in full or acting charge.

If the above suggestions are taken into account women would, no doubt, create better village and town communities based on harmony and cooperation achieved through gender balance and justice.

So far as the ward committees are concerned, they are significant addition to the structure of decentralisation. The ward committees have facilitated greater proximity between the citizens and their elected representatives. But this is not enough to ensure better functioning of urban services or accountability to citizens at the local level. They have yet to become an effective platform of accountability to citizens.

The financial and administrative support needed even for ward committees as are presently existing, are not adequate. As such it is suggested that such support mechanisms be expanded and also replicated to the extent necessary for ward Sabhas. It is further suggested that the issues of composition and proximity should be resolved at the earliest, only then the ward committees can function effectively. Otherwise the ward committees are likely to remain as appendages to the nagarpalika structure rather than effective platforms of citizen’s empowerment (Sivaramakrishna, K.C.; 2006: 51-52).


On the basis of the above analysis it be said that the overall impact of decentralization is visible in the form of provisions for regular local elections, reservation of seats for women, SCs and STs and strengthening the oversight and accountability functions of Gram Sabhas. As a result of these provisions, the local democracy has been deepened, political participation broadened and representation diversified. The very presence of large numbers of poor people in local councils, is a very significant development in the local political landscape of most parts of rural and urban India.

The political decentralization, thus, has largely been successful in the sense that most of the provisions of the constitutional amendments have been enacted in almost all the States and its impact has also been felt. The financial and administrative decentralization has progressed to a very limited extent. The scope for local revenue mobilization is very restricted, resulting in a high level of dependence on fund flows from higher levels of government. Despite formal provision for transfer of responsibilities to the lower tiers of local government and legislation governing transfer of development functions to Gram Panchayats, progress has been uneven.

However, most of the success on these fronts will depend on the relationship between the local bodies and local level bureaucracy. They would have to forget the love and hate relationship and work hand in glove for the success of the PRIs and the ULBs.

Decentralization is recognized as a largely positive aspect of political development. It entails arousing people’s aspirations and allowing and encouraging people to meet their own aspirations.

The decentralization process has now given rural and urban local bodies an opportunity

194 Decentralised Development through Cooperation

to assume greater responsibility for rural and urban management. A new set of political opportunities for deepening democracy and advancing development has been created. Achievements from any political decentralization have not been matched either by financial or functional or administrative decentralization. Only a small number of status continue to make steady progress with regards to decentralization, others are lagging behind. If the above suggestions are taken seriously and implemented conscientiously in letter and spirit, the local bodies can function effectively and efficiently.


Ward Committees : The 74th Constitutional Amendment Act envisages constitution of ward committees, consisting of one or more wards within the territorial area of a municipality having a population of three lakhs or more. The provision for ward committees was made to ensure some proximity between citizens and their elected representatives. The ward committees could serve as effective forums for interaction with elected ward councilors. The ward committees are expected to address local problems by performing planning, financial and administrative functions having a direct bearing on the related wards.

(K.C. Sivaramakrishnan (ed.), People’s Participation in Urban Governance, Concept Publishing Company, New Delhi, 2006).

Non-Governmental : A NGO is a non-profit group or association that acts Organization (NGO) outside of institutionalized political structures and pursues matters of interest to its members by lobbying,
persuasion, or direct action. The term is generally restricted to social, cultural, legal and environmental advocacy groups having goals that are primarily non- commercial. NGOs usually gain at least a portion of their funding from private sources. Because the label “NGO” is considered too broad by some, as it might cover anything that is non-governmental, many NGOs now prefer the term Private Voluntary Organization (PVO) or Private Development Organization (PDO).



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Background Paper for Seminar on Accountability of Local Bodies and DRDAs, National
Academy of Audit & Accounts, Shimla, 15th and 16th September, 1999.
Baviskar, B.S., “Impact of Women’s Participation in Local Governance in Rural India”, in L.C. Jain (ed.), 2005, Decentralization and Local Governance, Orient Longman, New Delhi.

Impact of Decentralised Development 195

Biju, M.R., “The Sage of Decentralization in Kerala: Unique Model of Participatory Planning Process”, in Sebasti L. Raj SJ and Edward Mathias (eds.), 1998, People’s Power and Panchayati Raj Theory and Practice, Indian Social Institute, New Delhi.
Chandrashekar, B.K., Panchayati Raj in India – Status Report 1999, Task Force on
Panchayati Raj, Rajiv Gandhi Foundation, New Delhi, 2000.
Ghosh, Buddhadeb, “Accountability of Panchayats: Ends and Means”, in L.C. Jain (ed.),
2005, Decentralization and Local Governance, Orient Longman, New Delhi.
Gupta, D.N., 2004, Decentralization Need for Reforms, Concept Publishing Company, New Delhi.
Jain, S.P., “Decentralization in India: An Appraisal”, in S.N. Mishra, (eds.), 2003, Public Governance and Decentralization, Vol.II, Mittal Publications, New Delhi.
Meenakshisundaram, S.S., “Rural Development for Panchayati Raj”, in L.C. Jain (ed.),
2005, Decentralization and Local Governance, Orient Longman, New Delhi.
Mishra, S.N., “The 73rd Constitution Amendment and the Local Resource Base: A Critical Appraisal”, in S.S. Chahar (ed.), 2005, Governance at Grassroots Level in India, Kanishka Publishers, New Delhi.
Mishra, S.N. and Mishra, Sweta, 2002, Decentralized Governance, Shipra Publications, New Delhi.
Mishra, Sweta, 1994, Democratic Decentralization in India, Mittal Publications, New
Mohmand, Shandana Khan, “Representative Decentralization vs Participatory Decentralization: Critical Analysis of the Local Government Plan 2000”, in L.C. Jain (ed.), 2005, Decentralization and Local Governance, Orient Longman, New Delhi.
Robinson, Mark, “A Decade of Panchayati Raj Reforms: The Challenge of Democratic Decentralization in India”, in L.C. Jain (ed.), 2005, Decentralization and Local Governance, Orient Longman, New Delhi.
Sharma, Ashok, “Developing Accountable Local Leadership through Citizens Voice: An Experience of Gram Sabha in An Indian State”, The Indian Journal of Public Administration, Vol.XLIX, No.4, October-December, 2003.
Sharma, P.R. and Joshi, R.P., “Dimensions of Decentralization: A View from States”, in G. Palanithurai (ed.), 2004, Dynamics of New Panchayati Raj System in India, Vol.III, Concept Publishing Company, New Delhi.
Singh, S.K., “District Planning Committee: Problems and Prospects”, in S.S. Chahar (ed.),
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Publishing Company, New Delhi.


1) Discuss the impact of decentralised development.
2) According to you what reforms will make decentralised development a success.


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13.0 Learning Outcome

13.1 Introduction

13.2 Initiatives towards Constitutional Status to Local Governance

13.2.1 Features of 73rd Constitutional Amendment

13.2.2 Features of 74th Constitutional Amendment

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13.6 Conclusion

13.7 Key Concepts

13.8 References and Further Reading

13.9 Activities


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1.1 Introduction

1.2 Concept of Democratic Decentralisation

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1.4 Significance of Democratic Decentralisation

1.5 Democratic Decentralisation in India

1.6 Conclusion

1.7 Key concepts

1.8 References and Further Reading

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After studying this unit, you should be able to:

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