Introduction and Constitutional Framework

Definition of rural/village
Rural areas are also known as the 'countryside' or a 'village' in India. It has a very low population density.
In rural areas, agriculture is the chief source of livelihood along with fishing, cottage
industries, pottery etc.

According to article 243 (g) of the constitution village means an area specified by the governor by
public notification to be a village for the purposes of this part and includes a group of villages so
specified.

As per the latest census which meets the following criteria,

A population of less than 5,000

Density of population less than 400 per sq km and

more than "25 per cent of the male working population" is engaged in agricultural pursuits.

Diversity Based on Geography

Nearly 70 per cent of the countrys population lives in rural areas where, for the first time since
independence, the overall growth rate of population has sharply declined, according to the latest Census.
Spanning an area of 3,287,263 square kilometres, India is a vast country with great diversity of physical
features like dry deserts, evergreen forests, snowy Himalayas, a long coast and fertile plains. Certain parts
in India are so fertile that they are counted amongst the most fertile regions of the world, while other are
so unproductive and barren that hardly anything can be grown there.
The region of Indo-Gangetic valley belongs to the first category, while certain areas of Rajasthan fall
under the latter category. From the point of climate, there is a sharp contrast; India has every variety of
climates from the blazing heat of the plains, as hot in places as hottest Africa to freezing points of the
Himalayas as in the Arctic.

Demographics and Social Context

In a country like India, with multilingual, multi-ethnic, multicultural and multilevel society, the Census
stretches a snapshot of not only the demographic but also the social, cultural and economic profile of the
country at a particular point of time.

Census serves as a source of primary data at the level of village or town. It provides precious information
for planning and formulation of policies by the government and is also used widely by national and
international agencies, businessmen, industrialists, scholars and many more. In addition, it provides a
basic frame for conduct of various surveys in the country. Any informed decision making that is based on
empirical data is dependent on the Census. Last census was conducted in 2011.
Demographic factors such as size of the population, population growth rate, rural-urban pattern, sex ratio,
literacy rate, age composition, ethnic composition, density of population, family size, nature of the family,
income levels etc. have significant business implications with a mammoth rural population, India bids a
large rural market potential. Rural India presents a baffling dichotomy of images, on one hand persisting
poverty and on the other hand corporate giants betting big on the growing potential of rural markets. The
fact is that rural India is anything but a homogeneous category .A market comprises people for exchange
of goods and services. The size and growth rate of the population, gender segmentation, level of literacy
and the speed of urbanization are some of the demographic factors that need to be understood to estimate
the extent of marketable opportunities. The huge gap in rural and urban population, changes in rural
consumer behaviour, size and scattered rural markets, age and gender divisions pose complex problems
and marketers need to make diverse strategies to tap the rural markets. Therefore, it is important to
understand selected rural demographics of India.

Issues and Challenges

1. A DIMINISHING URBAN-RURAL DIVIDE: Rural and urban livelihoods are inter-dependent, and there
is rarely a sharp geographical divide between rural and peri-urban. Rural development strategies must take
account of the urban links and context.

2. DIVERSIFIED LIVELIHOODS: There are few full-time farmers now, as households pursue multi-
functional and multi-spatial livelihoods, support to the non-farm rural economy and to migration are as
important as agricultural support.

3. SCATTERED LAND HOLDINGS: More households consist of part-time farmers, work on smaller plots
and are headed by the elderly, young and women, so face severe credit and input constraints; access to
subsidies and extension services has diminished; market changes increase the need for specialist
techniques, quality control, information-intensive technologies and marketing involving high transaction
costs factors which provide larger farms with economies of scale. Targeted assistance is needed where
small-scale farming can be competitive; otherwise small farmers need good exits from farming.

4. REVERSE STATE COMPRESSION: A strong state is needed to underpin the market and enable private
sector development. Public interventions are needed to increase access to new opportunities (agricultural
or non-farm) specifically by the poor, and to establish the institutional framework for effective market
development.

5. TECHNOLOGICAL TARGETING: Production increases based on the seed-fertiliser model of the Green
Revolution have slowed. New technologies are likely to be more crop and region specific, and
information-intensive. Technical change is biased against the poor. Policies to target technologies need to
be location specific. Public intervention is particularly required in developing technologies and
information channels appropriate to poor farmers.

6. RETHINKING INSTITUTIONAL CAPACITY AND GOVERNANCE: Many recommended measures for

rural development cannot be effective without significant capacity building and institutional support. In
some areas, decentralisation should be promoted to reinforce positive trends for increased accountability.
But in some areas, states are dysfunctional (eg conflict zones), or crippled (high HIV incidence), and
second best solutions would be more effective than attempts at business as usual.

7. GROWING DIVERGENCE BETWEEN LOW AND HIGH POTENTIAL AREAS: Less favoured (low potential)
areas have very different needs to (high potential) areas where modernisation is already underway. They
still need agriculture-based development, are least likely to gain from globalisation opportunities, and will
generate lower returns because of their inherent disadvantages (remoteness, poor soils etc). Policy must
adapt to context.

8. RURAL RISKS AND VULNERABILITY: The rural poor face new risks due to increasing natural
disasters and rapid economic change. External support for risk-mitigation and coping strategies is
generally insufficient. Public and private roles in supporting insurance and risk-coping need to be
strengthened, which in turn depends on the fiscal burden being addressed.

9. PREVENTING AND MANAGING CONFLICT: Conflict has a debilitating impact on rural livelihoods, and
increasing levels of conflict threaten the achievement of poverty reduction targets. Donors will need to
escape from the conceptual and programmatic constraints of a linear approach to relief and development.

Governance and Indicators of Good Governance

Governance refers to taking care of the people governed. The foremost objective of governance is to
provide security to the people. According to World Bank there are six indicators of governance accepted
by 214 countries including India:
Voice and Accountability
Political Stability and Absence of Violence
Government Effectiveness
Regulatory Quality
Rule of Law
Control of Corruption

Different Forms of Democratic Governance

1. DIRECT DEMOCRACY: A direct democracy or pure democracy is a type of democracy where the
people govern directly. Athenian democracy or classical democracy refers to a direct democracy
developed in ancient times in the Greek city-state of Athens. A popular democracy is a type of
direct democracy based on referendums and other devices of empowerment and concretization
of popular will.
2. REPRESENTATIVE DEMOCRACIES: A representative democracy is an indirect democracy where
sovereignty is held by the people's representatives. Its various types are electoral democracy,
dominant-party system, parliamentary democracy, Westminster democracy, presidential
democracy etc.

Branches of Government in India

1. LEGISLATURE: India has a bicameral system of legislature. The upper house is known as the
House of States (Rajya Sabha) whereas the lower house is known as the House of Commons
(Lok Sabha). The members of the lower house are elected directly by the people of India
divided into 543 constituent assemblies and their tenure is for five years. The members of the
upper house (250) are elected indirectly by the members of the state legislative assemblies and
their tenure is for six years. The lower house can be dissolved by the president whereas the
upper house is permanent. Both of the houses debate, discuss and decide over the bills drafted
by the cabinet and the concerned ministry. The bill passed by the parliament is then verified by
the president whose signature convert it into a law.

2. EXECUTIVE: The president of India is the head of the executive branch and commander-in
chief of the armed forces. He appoints the governors of states, the chief justice of India, the
attorney general, the comptroller and auditor general, the cabinet secretary etc. His signature is
the final consent to the conversion of a bill into a law.
The vice-president is the chairman of the Rajya Sabha and exercises the roles of the president in
his absence.
The prime minister is the chief of the government and the chief advisor to the president. He
heads the cabinet and allots portfolios to the various ministers. The remaining departments are
held by the prime minister. Historically, he has been holding dept. of pension, personnel and
 public grievances, dept. of space and dept. of atomic energy. He is the leader of the party having
majority in Lok Sabha.
The cabinet ministers constitute the cabinet which does the preliminary work of lawmaking. It
discusses on the bill drafted by the concerned ministry and then it is forwarded for further
debating in the parliament. It can also promulgate ordinances in cases of urgency but has to get
it converted into law within six months. These ministers are followed by ministers of state
(independent charge), ministers of state and deputy ministers. Only 15% of Lok Sabha members
can be made ministers according to the constitution.
Bureaucracy is another important part of executive. It is the vehicle which delivers policies of
the government. The cabinet secretary is the chief of the Indian Administrative Services who
conducts the cabinet meetings, prepares agenda and documents the meetings, promotes inter-
ministerial coordination etc. Bureaucracy is synonymous to hierarchy which goes as:

Cabinet Secretary

Secretary

Additional Secretary

Joint Secretary

Director

Under Secretary

Section Officer

Upper Division Clerk

Lower Division Clerk

The secretaries of ministries of home, external affairs, defence and finance form the most
powerful group in the country.

3. JUDICIARY: India has a multilevel judicial system with supreme court being the highest court
followed by high courts of states and union territories, district court and sessional courts. In
case of constitutional matters one can directly approach the supreme court.

Preamble of Constitution
WE, THE PEOPLE OF INDIA, having solemnly resolved to constitute India into a SOVEREIGN,
SOCIALIST, SECULAR, DEMOCRATIC, REPUBLIC and to secure to all its citizens:
JUSTICE, social, economic and political;
LIBERTY of thought, expression, belief, faith and worship;
EQUALITY of status and of opportunity;
and to promote among them all
FRATERNITY assuring the dignity of the individual and the unity and integrity of the Nation;

IN OUR CONSTITUENT ASSEMBLY this twenty-sixth day of November, 1949, do HEREBY ADOPT, ENACT
AND GIVE TO OURSELVES THIS CONSTITUTION.

73rd Constitutional Amendment

(source: http://indiacode.nic.in/coiweb/amend/amend73.htm)

The 73rd Amendment Act came into being in 1992. It involved insertion of a new Part IX- The
Panchayats after Part VIII of the constitution.

Major provisions of the Act:

1. The establishment of a three-tier PRI structure, with elected bodies at village, block and district levels
(States with populations less than 2 million are not required to introduce block-level
Panchayats)."Panchayat means an institution (by whatever name called) of self-government constituted
under article 243B, for the rural areas.

2. The recognition that the Gram Sabha constitutes a deliberative body at the village level. "Gram
Sabha" means a body consisting of persons registered in the electoral rolls relating to a village
comprised within the area of Panchayat at the village level.

3. Direct elections to five year terms for all members at all levels;
4. One-third of all seats are reserved for women; reservations for SCs and STs proportional to their
populations;

5. Reservations for chairpersons of the Panchayats Sarpanches following the same guidelines
6. State legislatures may provide reservations for other backward groups;
7. A State Election Commission (SEC) will be created to supervise, organise and oversee Panchayat
elections at all levels;

8. A State Finance Commission (SFC) will be established to review and revise the financial position of
the Panchayats on five-year intervals, and to make recommendations to the State government about the
distribution of Panchayat funds

Panchayats (Extension to Scheduled Areas) Act, 1996 or PESA

(source: http://tribal.nic.in/Content/DefinitionofScheduledAreasProfiles.aspx )

The Provisions of the Panchayats (Extension to Scheduled Areas) Act, 1996 or PESA is a law enacted by
the Government of India applicable to the "Scheduled Areas", which are not covered in the 73rd
amendment or Panchayati Raj Act of the Indian Constitution. It was enacted on 24 December 1996 to
enable Gram Sabhas to self govern their natural resources. It is an Act to provide for the extension of the
provisions of Part IX of the Constitution relating to the Panchayats and the Scheduled Areas. At present
(2013) ten states have fifth schedule areas. These are: Andhra Pradesh, Telangana,[2] Chhattisgarh,
Gujarat, Himachal Pradesh, Jharkhand, Madhya Pradesh, Maharashtra, Odisha and Rajasthan

The criteria followed for declaring an area as Scheduled Area are preponderance of tribal population;
compactness and reasonable size of the area; under-developed nature of the area; and marked disparity in
economic standard of the people. These criteria are not spelt out in the Constitution of India but have
become well established. They embody principles followed in declaring `Excluded and `Partially-
Excluded Areas under the Government of India Act 1935, Schedule `B of recommendations of the
Excluded and Partially Excluded Areas Sub Committee of Constituent Assembly and the Scheduled Areas
and Scheduled Tribes Commission 1961.

Federal Form of Government in India

Governments have been classified into Unitary and Federal based on distribution of power between
national and regional governments. In a federal set up there is a two tier of Government with well
assigned powers and functions. In this system the central government and the governments of the region
act within a well defined sphere, co-ordinate and at the same time act independently. The federal polity, in
other words, provides a constitutional device for bringing unity in diversity and for the achievement of
common national goals. Hence, India was made a Federal system of government.

Features of Indian Federalism:

Features of Indian constitution that makes it federal are listed in the following points:
 WRITTEN CONSTITUTION: The most important feature of a federation is that it should have a
written constitution, so that both the Union Government as well as the State can refer to that
whenever conflict arises. The Constitution of India is a written and most elaborate Constitution of
the world.

SUPREMACY OF CONSTITUTION: The constitution is the supreme because both the union and the
states are given powers by the Constitution as to be independent in their spheres of governance.
Both make laws conforming to the provisions of constitution otherwise they can be declared
invalid by the supreme court through its power of judicial review.

RIGID CONSTITUTION: The procedure of amending the Constitution in a federal system is

normally rigid. Indian Constitution provides that provisions regarding the federal attributes can be
amended by a special majority,i.e. such an amendment has to be passed by majority of total
members of each house of the Parliament as well as, by two-thirds majority of the members
present and voting there. Also, in addition to this process, such amendments must be approved by
at least 50% of the states. After this procedure the amendment is signed by the President.

DIVISION OF POWERS : In our Constitution, there is a clear division of powers so that none
violates its limits and tries to encroach upon the functions of the other and functions within own
sphere of responsibilities. There are three lists enumerated in the Seventh Schedule of
constitution, the Union list, the State list and the Concurrent List. The Union List consists of
100 subjects of national importance such as Defence, Railways, Post and Telegraph, etc. The
State List consists of 61 subjects of local interest such as Public Health, Police etc. The
Concurrent List has 52 subjects important to both the Union and the State. such as Electricity,
Trade Union, Economic and Social Planning, etc.

SUPREMACY AND INDEPENDENCE OF THE JUDICIARY: A very important feature of a

federation is an independent judiciary to interpret the Constitution and to maintain its sanctity .
The Supreme Court of India has the original jurisdiction to settle disputes between the Union and
the States. It can declare a law as unconstitutional, if it contravenes any provision of the
Constitution.

Nature of Indian Federalism

In spite of the fact that the Indian Constitution establishes a federal structure, it is indeed very different
than a true federation. The framers of the Constitution have modified the true nature of Indian federation
by incorporating certain unitary features in it. These are :

1. UNION OF STATES: The Constitution of India has federal features but it does not claim to be a
federation. It calls India a Union of States. Article I of the Constitution describes India as a
Union of States, which implies two things: firstly , it is not the result of an agreement among the
States and secondly, the States have no freedom to secede or separate from the Union. Besides,
The federation is a union because it is indestructible and helps to maintain the unity of the
country.
2. APPOINTMENT OF GOVERNOR OF STATE:The Centre appoints the Governors of the States who
enjoys extensive powers in special circumstances. Governor is the agent of the Centre in the
States. In the past he Governor has acted more as Centres representative than as the head of the
State. This enables the Union government to exercise control over the State administration.
3. UNEQUAL REPRESENTATION IN UPPER HOUSE: The equality of units in a federation is best
guaranteed by their equal representation in the Upper House of the federal legislature
 (Parliament). However, this does not happens in case of Indian States. They have unequal
representation in the Rajya Sabha.
4. APPOINTMENT OF IMPORTANT ORGANISATION HEADS: All important appointments such as the
Chief Election Commissioner ,the Comptroller and Auditor General are made by the Union
Government.
5. SINGLE CITIZENSHIP: There is no provision for separate Constitutions for the states. The
States cannot propose amendments to, the Constitution. Amendments can only be made by the
Union Parliament.
6. ALL INDIA SERVICES: In order to ensure uniformity of the administrative system and to
maintain minimum common administrative standards without impairing the federal system, All
India Services such as IAS and IPS have been created which are kept under the control of the
Union.
7. EMERGENCY PROVISIONS: During Financial Emergency, the Centre exercises full control over
the States finances. In case of disturbances in any State or part thereof, the Union Government is
empowered to depute Central Force in the State or to the disturbed part of the State. In all three
types of emergencies, Centre is empowered to exercise full control over the state machinery.
8. PARLIAMENT CONTROL OVER STATE: It can make laws to increase or decrease the area of any
State and may alter its name and boundaries. It may alter subjects n the state list also.
9. UNIFIED JUDICIARY: Contrary to the federal principle which has a dual system of Courts,
India has unified Judiciary with the Supreme Court at the apex.

Decentralization of Government
Decentralization is the process of redistributing or dispersing functions, powers, people or things away
from a central location or authority.Political decentralisation transfers policy and legislative powers
from central government to autonomous, lower-level assemblies and local councils that have been
democratically elected by their constituencies. Administrative decentralisation places planning and
implementation responsibility in the hands of locally situated civil servants and these local civil servants
are under the jurisdiction of elected local governments. Fiscal decentralisation accords substantial
revenue and expenditure authority to intermediate and local governments.

Decentralization was done because of 2 reasons:

(a) need for political instability
(b) more effective and efficient service delivery

Rural decentralization while initiated by the centre has become a state affair.
Three Tier System of Government

1. Central Government
2. State Government
3. Self Government
Rural Government
Urban Government

Central Government is chosen by party/group of parties which get more than 50% seats in the
parliamentary elections i.e. Lok Sabha elections.

State Government is chosen by the party/group of parties which get more than 50% seats in the assembly
elections of a state i.e. Vidhan Sabha elections.

Municipal Corporation/Gram Panchayats are a bit different. Elections are held here too but it is not a one
party's Government.

Particularly, in a Municipal Corporation, all the corporators are elected by voters in the elections which
are held every 5 years. But the person who heads the Municipal Corporation i.e. The Municipal
Commissioner gets appointed by the State Government. He/she is an IAS officer by qualification.

Its legislature is known as corporation council and the party with maximum number of members in it gets
to choose the person for the post of Mayor. However, mayor is just a ceremonial post just like that of the
President of India.
 The 3rd Tier

1. VILLAGE PANCHAYAT:

In the structure of the Panchayati Raj, the Village Panchayat is the lowest unit. There is a Panchayat for
each village or a group of villages in case the population of these villages happens to be too small. The
Panchayat chiefly consists of representatives elected by the people of the village.

Only the persons who are registered as voters and do not hold any office of profit under the government
are eligible for election to the Panchayat. The persons convicted by the court for criminal offences are
disqualified from election of the Panchayat.

There is also provision for co-option of two women and one member of the Scheduled Castes and
Scheduled Tribes, if they do not get adequate representation in the normal course.

The Panchayat as a body is accountable to the general body of the village known as Gram Sabha which
meets at least twice a year. The Gram Panchayat must present its budget, accounts of the previous year
and annual administrative report before the Gram Sabha. Furthermore, it has to secure the latters
approval of the village production plan, proposals for taxation and development programmes before they
are enforced by the Panchayat.

Every Panchayat elects a President or Sarpanch and a Vice-President or Upsarpanch.

He is an ex-officio member of the Panchayat Samiti and participates in its decision-making as well as in
the election of the Pradhan and of the members of various Standing Committees. He acts as the executive
head of the Panchayat, represents it in the Panchayat Samiti as its spokesman and coordinates its activities
and those of other local institutions like cooperatives.

The Panchayat Secretary and the Village Level Worker are the two officers at the Panchayat level to assist
the Sarpanch in administration.

The Panchayat Secretary assists the Panchayat in recording decisions, keeping minutes, preparing budget
estimates and reports, and does other sundry jobs like preparing notices, explaining circulars, organising
Gram Sabha meetings etc.

The Village Level Worker now called Village Development Officer assists the Panchayat in drawing up
agricultural production plans, helps farmers in securing loans for agriculture, arranges the supply of inputs
like seeds and fertilizers, and educates farmers about modern agricultural practices. He serves as the
principal link between the Panchayat and the Panchayat Samiti.

He keeps the Panchayat informed of various development programmes and reports to the Panchayat
Samiti about the progress of the schemes and achievement of targets. He is accountable to the Sarpanch at
the Panchayat level on the one hand, and to the Block Development Officer and extension officers on the
other hand at the Samiti level.

The Gram Panchayats can levy certain taxes and duties to meet their expenses. Some of the taxes which
the Gram Panchayats can levy include tax on animals, vehicles, house, vacant lands and professions. They
can also levy duty on transfer or property situated in the area under their jurisdiction.

The fees paid for presenting civil criminal cases before the Panchayats and fines on account violation of
Panchayat laws are other sources of its income. But a, as the duties to be performed by the Panchayats are
so onerous that they have to depend on the state government for further finances.

As regards the principal functions performed by the Village Panchayat, they include maintenance of
roads, wells, schools, burning and burial grounds, sanitation, public health, libraries, reading rooms,
community centre etc.

It seeks to ensure a minimum standard of cultivation for raising agricultural production. In addition, the
Panchayat also acts as the agent of the Panchayat Samiti in executing schemes of development at the
village level.

2. PANCHAYAT SAMITI:

The Panchayat Samiti is the second on join tier of the Panchayati Raj. It takes charge of all aspects of
development in rural areas.

Usually a Panchayat Samiti consists of 20 to 60 villages depending on area and population. The
Panchayat Samiti consists of-

(1) about twenty members elected by and from the Panches of all the Panchayats falling in the block area;

(2) two women members and one member each from the Scheduled Castes and Scheduled Tribes

(3) two local persons possessing experience of public life and administration, which may be beneficial for
the rural development;
(4) representatives of the Co-operatives working within the jurisdiction of the block;

(5) one representative elected by and from the members of each small municipality lying within the
geographical limits of a block;

(6) the members of the State and Union legislatures representing the area are to be taken as associate
members.

The President of the Panchayat Samiti is the Pradhan, who is elected by an electoral college consist of all
members of the Panchayat Samiti and all the Panchas of the Gram Panchayat falling within the areas.
Besides the Pradhan, the Up-pradhan is also elected. The Pradhan convenes and presides over the
Panchayat Samiti meetings. He guides the Panchayats in making plans and carrying out production
programmes.

He ensures the implementation of the decisions and resolutions of the Samiti and its Standing
Committees. He exercises administrative control over the Vikas Adhikari (BDO) and his staff. He is a
member of the Zilla Parishad by virtue of his office as a Pradhan.

As the CEO of the Panchayat Samiti, the Block Development Officer is entrusted with the responsibility
for implementing the resolutions of the Samiti and its Standing Committees. He prepares the budget of the
Samiti and places it before the Samiti for approval. Preparing the annual report of the Samiti and sending
it to the Zilla Parishad and State Government also comes within the purview of his responsibility. He is
accountable to the President of the Samiti for his actions.

The principal function of the Panchayat Samiti is to coordinate the activities of the various Panchayats
within its jurisdiction. The Panchayat Samiti supervises the work of the Panchayats and scrutinises their
budgets

It has actually no independence in instituting special programmes or development projects of its choice
and just carries out the directives of the State Government pertaining to specific projects.
 3. ZILLA PARISHAD:

The Zilla Parishad stands at the apex of the three-tier structure of the Panchayati Raj system. Generally,
the Zilla Parishad consists of representatives of the Panchayat Samiti; all the members of the State
Legislature and the Parliament representing a part or whole of the district; all district level officers of the
Medical, Public Health, Public Works, Engineering, Agriculture, Veterinary, Education and other
development departments.

There is also a provision for special representation of women, members of Scheduled Castes and
Scheduled Tribes provided they are not adequately represented in the normal course. The Collector is also
a member of the Zilla Parishad.

The Chairman of the Zilla Parishad is elected from among its members. There is a Chief Executive
Officer in the Zilla Parishad. He is deputed to the Zilla Parishad by the State Government. The Zilla
Parishad, for the most part, performs co-ordinating and supervisory functions. It coordinates the activities
of the Panchayat Samitis falling within its jurisdiction. In certain states the Zilla Parishad also approves
the budgets of the Panchayat Samitis.

The Zilla Parishad also renders necessary advice to the Government with regard to the implementation of
the various development schemes. It is also responsible for the maintenance of primary and secondary
schools, hospitals, dispensaries, minor irrigation works etc. It also promotes local industries and art.

The finances of the Zilla Parishad consist of the grants received from the State Government and share in
the land cess and other local cess and taxes. Sometimes it has been allowed by the State Government to
levy certain taxes or enhance the taxes already levied by the Panchayat Samitis subject to a certain limit.

Panchayati Raj System

Panchayati Raj system in india generally refers to the system introduces by the constitutional
amendments in 1992, although it is based upon the traditional panchayat system of south Asia .The
modern Panchayati Raj and its gram panchayats are not to be confused with the extra-constitutional khap
panchayats or caste panchayats found in the northern india.

Various committees on Panchayati Raj :

1.Balwant Rai Mehta : Estd 1957

2.V.T.Krishnammachari:1960

3.Takhatmal Jain Study Group:1966

4.Ashok Rai Mehta Committee:1977

5.G.V.K Rao Committee:1985

6.Dr.L.M.Singhvi committee:1986
Urban Local Governments

MUNICIPAL CORPORATIONS :

In India , municipal corporations or city corporation or mahanagar palika or mahanagar nigam are the
urban local government that works for the development of a city, which has a population of more than one
million (ten lakh). The growing population and urbanisation in various cities of india were in need of a
local governing body that can work for providing necessary community services like health care,
educational institutions, housing , transport etc. by collecting property tax and fixed grant from the state
govt.

Each municipal corporation has a committee consisting of a Mayor with councillors.The number of
councillors depend upon the area and the population of the city that minimum of 3,00,000. Municipal
corporation members are elected from several wards of specific city on the basis of adult franchise for a
term of five years . There are seats reserved for Sc,St,other backward classes and women.The councillors
are chosen by direct election from electoral wards in the municipal corporation.

Mayor is the head of the Municipal Corporation. The municipal commissioner is the official incharge of
this organisation. Executive officer monitors the implementation of all the programs related to the
planning and development of the corporation with the coordination of Mayor and councillors.
Main functions of Municipal Corporation are : water supply, hospitals ,roads, bridges, street lighting,
drainage, solid waste,fire brigades , marketplaces, records of births and deaths and also helps in the
education dna primary health care

Its sources of income are taxes on water,houses,markets, entertainment and vehicle paid by the residents
of the town and grants from the state govt.

MUNICIPAL COUNCILS :

In India, Municipal Councils or Town Municipalities or Nagar Palika or Municipality is an urban local
body that administers a city of a population 100,000 or more . however there are exceptions to that , as
previously Nagar Palikas were constituted in urban centres with population over 20,000 , so all the urban
bodies which were previously classified as Nagar Palikas were reclassified as Nagar Palikas even if their
population was under 100,000. Under the panchayati raj system, it interacts directly with state government
though it is administratively part of the district it is located in. Generally small cities and bigger towns
have a Nagar Palika.Nagar Palikas are also a form of local self-govt entrusted with some duties and
responsibilities, as enshrined in the constitutional (74 amendment) Act,1992.

The members of nagar palika are elected representatives for a term of five years . The town is divided into
wards according to its population, and representatives are elected from each ward. The members elect a
president among themselves to preside over and conduct meetings . A chief Officer , along with officers
like an engineer ,(accountant & auditor)sanitary inspector, health officer and education officer who come
from the state public service are appointed by the state government to control the administrative affairs of
the nagar palika.

Its responsible for water supply , hospitals, roads, street lighting, drainage, fire brigade, marketplaces,
records of death and birth and solid waste management. Its sources of income are taxes on
water,houses,markets,entertainment and vehicles paid by the residents of town and grants from the state
govt.
NAGAR PANCHAYAT :

A Nagar Panchayat or Notified Area Council or City Council in india is a settlement which is in transition
from rural to urban .

Each nagar panchayat has a committee consisting of a chairman/mayor along with ward members.
Membership consists of a minimum of ten elected ward members and three nominated members.NAC
members if nagar panchayat are elected from several wards of nagar panchayat on the basis of adult
franchise for a term of five years. There are seats reserved for Sc,St,Obc and women. The councillors or
ward members chosen by direct election from electoral wards in the nagar panchayat.

The Chairman is the head of the NAC. The executive officer is the official incharge of NAC.Executive
officers monitor implementation of all the programs related to planning and development of the NAC with
the coordination of the NAC chairman and all ward members.

Its main functions are to provide essential services and facilities to the urban area, sanitation programme
in township, street lighting and providing roads in every ward and main roads of the town, set up and run
schools in urban area, water supplying to every ward of the urban area, drainage system, build culvert for
undergoing drainage system, records of births and deaths etc.

Its sources of income : nagar panchayat derive income from taxes including those on water ,pilgrimage,
markets and transport services. They also receive a mixed grant from the state govt in proportion to the
land revenue and money for works and schemes assigned to them.

Key Findings
Past attempts towards rural decentralization in India were highly unsuccessful, and PRIs remained
non-functional.
Since independence there has been an agreement on the need for rural decentralization, but the design in
the various attempts faced inadequate institutional, legislative or policy environments for implementation.
As a result, past attempts were unsuccessful, with the PRIs haunted by bureaucratic and political
resistance at the state level to share power and revenues, inadequate resources and capacity, and
domination by the elite. They nevertheless provided lessons and helped shape constitutional initiatives
that came later.
The 73rd Amendment was a formal instrument introduced by the center, and blessed by the State
Assemblies, to force a minimum level of rural decentralization uniformly across all states.
After ratification by more than half of the State Assemblies, and after obtaining the assent of the President
Act, the 73rd Constitutional Amendment of 1992 and the Provisions of the Panchayats (Extension to the
Scheduled Areas) Act of 1996 established mandatory provisions for decentralization to local governments
in rural India. These include (i) the creation of a three-tier local government structure at the district, block
and village levels; (ii) constitution of state election commissions and state finance commissions; (iii)
regular PRI elections with seat reservation for SCs/STs and women; (iv) establishment of Gram Sabha
(village assembly) to exert control over local government, and (v) periodic auditing of local governments
accounts.
The Constitutional Amendment mandates political decentralization, leaving issues of design and
implementation on sectoral, administrative and fiscal aspects to the States.
To provide an appropriate legislative framework to ensure minimum stability and continuity of local
governments, a constitutional amendment was necessary. The Constitutional process required ratification
by state politicians. To ensure state support to the Amendment, the scope, details and pace of its
implementation were left to the discretion of state governments and their legislatures. These included the
definition of powers of gram sabhas (village assembly) and the transfer of sectoral, administrative and
fiscal responsibilities to PRIs.
As a result, rural decentralization while initiated by the center has become a state affair.
The Amendment has, for all practical purposes, delegated responsibilities for the design and
implementation of decentralization to the states. This is done either through explicit provisions, or by
omission. The State governments are given the discretion to translate the intended objective of the
Amendment into State legislation keeping in mind their own local contingencies. States have furthered the
design of decentralization through State Acts and Government Orders. But with such a wide area of
discretion, especially on such a crucial aspect of power and authority of PRIs has enabled the ix continued
control of the third tier, the PRIs, by the second tier, the States. For example, the State Acts have not
clarified the extent of power the PRIs and responsibilities of the different tiers of PRIs nor the
jurisdictional issue between PRIs and administration. This remains a grey area perhaps deliberately so
since in the absence of clear jurisdictions the state administration retains the power. Concerns have been
raised as to the quality of the process since important matters such as service delivery (including local
capacity building), transfer of responsibilities and powers to rural local bodies, the degree to which rural
communities are able to control local bodies, the de facto inclusion of minorities and disadvantaged
groups have apparently been left to the state administration. Today PRIs are not yet 3rd tier of the
government, but an extension of the 2nd tier.
While key design aspects of rural decentralization have been completed at the center and state
levels, implementation is lagging.
The 73rd Amendment, State Acts and the State Finance Commission reports set up basic political,
administrative and fiscal structures of rural local bodies. But while political decentralization has
progressed satisfactorily, administrative and fiscal decentralization are happening at a much more hesitant
pace.
Political decentralization has been highly successful.
States modified their Acts consistently with the requirements of the 73d Amendment, and most of them
have carried out local elections, albeit with delays relative to the constitutional provisions.4 The Acts,
mandated by the amendment have provided uniformity in terms of three-tier local governments at the
district, block and village levelsZilla Parishads at the district level (ZP), Panchayat Samities at the
block level (PS), and Gram Panchayat at the village level (GP). Participation in the local election process
is high.
However, issues of accountability remain.
Mechanisms of accountability, and in particular Gram Sabhas are not working, and neither are the right of
recall, the vigilance committees or recourse to higher authority. People do not see Panchayats making
decisions that are relevant to their lives, probably because PRIs have neither the resources to undertake
development, nor the power to influence existing programs. Gram Panchayats (GPs) have become multi-
village institutions and the resolution of competing village demands is made through less than perfect,
sometimes opaque decision processes. Voting and rules of voting procedures within PRIs are not specified
as mandatory in the Panchayat Acts. And caste and gender bias pervade the workings of PRIs, despite the
reservations.
Progress on administrative decentralization has been hesitant.
At the design level, most State Acts have broadly defined powers and functions to be devolved to PRIs,
from the indicative list of 29 functions in the XIth Schedule of the Constitution. However, in most cases,
the criteria driving the decision of devolution of functions is unclear. Moreover, there is no clear
demarcation of functions between the three tiers of the Panchayats, generating a confusing and uncertain
situation, and threatening 4 According to Mathew (1999) twenty states passed the required new legislation
only in the last month of the mandated period for legal reform. In several key states PRI elections were
held only after the due period (e.g. Tamil Nadu, Kerala), after the Supreme Court intervened (Orissa), or
have not yet been held (Bihar, Haryana). x accountability. Even where roles are defined, few states have
matched responsibilities with the necessary administrative reforms, such as staff transfer, issuance of
Orders, changes in administrative rules, etc.5 It is therefore unclear what does transfer of powers translate
into in terms of the ability of PRIs for making decisions that actually make a difference. The roles of state
bureaucracies have not yet changed noticeably with the new thrust towards decentralization nor are there
clear strategies for redefining their functions in a decentralized framework. More often than not state
bureaucracies keep control over key decisions involving resource allocation, or immerse local
governments in cumbersome administrative procedures that make life difficult for them.
Fiscal decentralization is lagging.
Each state set up a State Finance Commission (SFC) within one year, recommending resource allocation
and creation. However, in the absence of clear transfer of functions, all SFCs face the problem of
accessing the resource requirements of local bodies. They unanimously recommended that whenever state
governments decide to devolve any of the functions of schedule XI of PRIs they must also devolve
finances along with the functionaries and empower them to discharge their responsibility effectively. But,
implementation of fiscal decentralization is not happening. Firstly, there is neither transparency nor
reliable information regarding the fiscal situation of PRIs and their expenditure authority. Secondly, only
minimal fiscal decentralization has taken place. In all seven states PRIs have a few taxes and fees but they
are heavily dependent on transfers. The total shares of revenues and expenditures that accrue to PRIs as a
percentage of all in state revenues and expenditures ranges from about 1% to 4%. This is very low by
international standards. Moreover, most of the funds reported in PRI budgets are not under the control of
local elected authorities. Untied funds, over which PRIs would be able to make allocative decisions, are
virtually negligible.
Rural constituents are not yet participating actively in local governments.
A field investigation was carried at in six districts of Rajasthan and Madhya Pradesh to assess the
preparedness of rural constituents to participate in and seize the opportunities created by decentralization.
People participate in the political process but show low levels of interest in PRIs as an instrument of
democracy and development. People do not participate in the accountability mechanisms and in particular
in the gram sabhas which on average were attended by only seven percent of eligible population. The
explanation for lagging participation is that people perceive little benefit from GPs given the scarce
resources under their control. Elected PRI representatives themselves, at every level, feel marginalized.
And there are issues of inclusion.
In the villages investigated, males, well informed citizens, and educated people were the most likely to be
active in the panchayats while landless people, tribals and women were less active. In general women
were the most disempowered. Participation was not affected by caste or land holdings. Education and
access to information are the two most significant influences associated with participation and
participation rates among women rise considerably with access to information. There is no evidence that
reservations contribute to inclusion. Karnataka, MP and UP seem to be the most advanced in this regard.
Reservations reduce the effectiveness of GPs. Finally, also there is no evidence that the presence of civic
organizations enhances participation in PRIs.

Key Conclusions
While the state decentralization models are similar, there are differences in the past in design and
pace of implementation.
Because of a centralized form of government, all states are at the same level of political maturity. More
fundamentally, the constitutional amendment has brought about a uniformity on the political structure of
local governments. The amendment has mandated a three tier local government structure, accountability
mechanisms such as the gram sabhas and mechanisms to promote inclusion, namely the reservations for
women and SC/STs. All states have put these mechanisms in place. There are some differences in design
between states primarily on the relative sizes, roles and importance of gram, block and Zila Panchayats.
For example, AP has prioritized the district level, while Rajasthan has given maximum importance to the
block level. Other states have focused on gram panchayats. Within the basic model there are also
differences reflecting speed of implementation. Kerala has transferred more fiscal resources to PRIs as
untied grants than any other states. And Maharashtra has moved faster in bringing sectoral staff under the
control of PRIs.
Rural decentralization in India is at a stage not much different from other developing countries.
Indicators were developed to provide an overall measure of the status of decentralization in India, and
allow comparisons with other countries. These indicators were applied to a sample of 20 countries/states
in Asia, Africa, Latin America and Europe. According to the overall indicator of decentralization, Indian
states, with some variations, ranked similar to countries or states such as Bahia in Brazil, Nicaragua,
Poland, Hidalgo in Mexico or Bangladesh. There are differences however in terms of the various
dimensions of decentralization. Broadly speaking Indian states are amongst the most politically
decentralized, are at the level of other countries/states on fiscal decentralization, and are lagging on
administrative decentralization.
Rural Decentralization is unbalanced.
While India is among the best performers on political decentralization, it ranks close to last on
administrative decentralization. International experience suggests that in order for decentralization to be
effective, it needs to be balanced along the three key dimensions political, administrative and fiscal.
Decentralization in India is unbalanced. Imbalance between dimensions undermines the functioning of the
intergovernmental system. Political decentralization tends to precede the other two types because in many
ways it is easier to do. The world over, electing local governments seems to be much easier than vesting
them with administrative control over significant functions or fiscal autonomy. But unless the imbalance
is corrected through greater fiscal and administrative decentralization, Indian states are unlikely to evolve
effective PRIs.
Today, PRIs do not have the capacity to perform to expectations.
The Indian Constitution defines PRIs as institutions of Self Government. This means, there must be
unambiguous administrative, fiscal, and political devolution such that local governments are empowered
to address local development needs. The study finds there are no rural self-governments in India today.
Political decentralization has been largely successful, with elections held regularly and with ample
participation. But there is only minimum administrative and fiscal decentralization. Hence PRIs do not
have the capacity to implement assigned functions, which remain de facto under the control of the state
administration. And because PRIs control few resources, do not make relevant decisions, and are
dysfunctional, the rural constituency shows little interest in them.
But PRIs are here to stay.
Through the 73rd amendment to the Constitution and subsequent developments, local government took on
a qualitatively different hue in India. Local elections have energized the system through new political
institutionspoliticians with a local base are emerging, with a firm hold in specific places. The system
now in place is significantly different from earlier, to a large extent failed, experiments in Panchayat Raj.
In the context of coalition politics at the national level, where States have become powerful actors and
hence have to be secured by political parties so that they can forge winning national coalitions, parties are
trying hard to consolidate their mass base. State governments, ruled by different political parties, have
begun to compete with each other to design better and more effective mechanisms for reaching to the
grassroots. This, some hope to do by building up the allegiance of the emergent xiv leadership of PRIs and
also by improving service delivery. The picture on the ground is a complex one, with much variation
across regions, even within a state. All this makes the ongoing decentralization process in India very
important, and very genuine. The 73rd constitutional amendment PRI experiment that has been underway
for nearly 7 years now has already exposed one generation to the system. It has, in these years, gained
momentum and legitimacy as a result of which it has changed the agenda of politics in India. Already PRI
elections are being fought more intensively than one would expect given the current devolution of powers
and resources (e.g. UP 2000). The new group of leaders who will be contesting the second round of
elections due to start will have a baseline on which to build. The PRI system has taken root.