On 28 October 2026, the Union Cabinet approved the Pradhan Mantri Viksit Gram Swaraj Yojana (PM VGSY), a Centrally Sponsored Scheme for strengthening Panchayats and traditional local bodies. The scheme has an outlay of ₹7,395.55 crore for 2026–27 to 2030–31 and covers States and Union Territories.
Scheme Design and Funding
The total allocation comprises a central share of ₹4,869.48 crore and a state share of ₹2,526.07 crore. PM VGSY is scheduled for five years and is co-terminus with the period of the Sixteenth Finance Commission. Its stated objectives include strengthening village-level governance, improving development planning and increasing financial accountability among Panchayats. The scheme is intended to cover more than 2.55 lakh Panchayats and traditional local bodies. Around 32 lakh elected representatives, Panchayat functionaries and other stakeholders are expected to benefit directly through capacity building and training. The Union Ministry of Panchayati Raj oversees the national policy framework for Panchayati Raj institutions.
Planning and Digital Governance
PM VGSY provides support for preparing 2.55 lakh holistic Gram Panchayat Development Plans annually through the eGramSwaraj portal. These plans enable Panchayats to set out local development priorities and activities. The scheme also includes capacity building for representatives and functionaries and measures to improve digital governance and financial accountability. eGramSwaraj is a digital platform used for Panchayat planning, progress reporting and accounting-related processes. The scheme aligns with the national vision of Viksit Bharat and centres on locally prepared development plans.
Constitutional Framework of Panchayats
The 73rd Amendment Act, 1992, gave constitutional status to Panchayati Raj institutions and came into force on 24 April 1993. It inserted Part IX, covering Articles 243 to 243-O, into the Constitution. The 11th Schedule lists 29 subjects that may be devolved to Panchayats, including agriculture, rural housing, drinking water and roads. Article 243B provides for Panchayats at village, intermediate and district levels, subject to the constitutional exception for States with a population not exceeding 20 lakh. Article 243-I provides for a State Finance Commission every five years to review the financial position of Panchayats.
Important Facts for Exams
- The 73rd Amendment Act added Part IX and the 11th Schedule to the Constitution.
- Article 243G concerns the powers, authority and responsibilities of Panchayats.
- The 11th Schedule contains 29 subjects associated with Panchayats.
- 24 April is observed as National Panchayati Raj Day in India.
PM VGSY runs from 2026–27 to 2030–31 and supports annual Gram Panchayat Development Plans through the eGramSwaraj portal.</final
