Comment: Decentralized Planning. (2006, 20 Marks)
Decentralised planning means that each tier of government plans for the functions within its competence, using resources it controls, and that district, state and national plans are built upward from these local plans. It is devolution of planning discretion, not deconcentration, which only posts central officials in the field. The idea goes back to M. K. Gandhi’s gram swaraj and the Balwantrai Mehta Committee’s democratic decentralisation (1957). India has put it in the Constitution but has rarely put it into practice.
From exhortation to constitutional mandate
- The plan era. The First Plan already spoke of plans at district and village levels. As Deputy Chairman (1967–71), D. R. Gadgil championed district planning, and the Planning Commission’s 1969 guidelines asked states to prepare district plans.
- Working groups. The M. L. Dantwala Working Group (1978) made the block the unit for integrating sectoral schemes into an area plan. The C. H. Hanumantha Rao Working Group (1984) recommended district planning bodies with technical cells. The G. V. K. Rao Committee (1985) found panchayats reduced to “grass without roots”.
- The 73rd and 74th Amendments (1992–93). Article 243G empowers panchayats to prepare “plans for economic development and social justice” on the 29 Eleventh Schedule subjects, and Article 243W does the same for municipalities. Article 243ZD requires a District Planning Committee in every district, at least four-fifths elected, to consolidate local plans into a draft district plan. Article 243ZE provides a Metropolitan Planning Committee for cities of ten lakh and more.
- Kerala’s People’s Plan Campaign (1996). Designed by T. M. Thomas Isaac, it devolved about 35–40% of the state plan outlay as untied funds. Plans were built upward from ward grama sabhas, with volunteer experts vetting projects.
- Gram Panchayat Development Plans. GPDPs have been prepared since 2015-16, when 14th Finance Commission grants began flowing directly to gram panchayats. The “Sabki Yojana Sabka Vikas” campaign (from 2 October 2018) made them annual, and they are uploaded on e-GramSwaraj.
- Viksit Gram Panchayat Plans. The VB–G RAM G Act, 2025, which replaced MGNREGA, requires these plans. The gram panchayat prepares them, the gram sabha approves them, and they are aggregated at block, district, state and national levels on the PM Gati Shakti geospatial platform.
Significance
- Knowledge. Only the village knows whether it needs a well or a road, which is F. A. Hayek‘s point about dispersed knowledge applied locally.
- Participation and accountability. The gram sabha links planning to social audit and gives voice to women, Dalits and Adivasis through reserved seats.
- Localising the SDGs. Panchayat plans now follow nine localised SDG themes, which the Panchayat Advancement Index measures.
Limits
- Dormant DPCs. DPCs were constituted late or only on paper, and many are chaired by ministers. Their “plans” usually collect departmental proposals rather than consolidate local ones.
- The 3Fs. States devolve functions on paper but keep funds and functionaries.
- Finance. State Finance Commissions are often late, and their reports often go untabled. Panchayats raise only about 1% of their revenue themselves.
- Measured stagnation. The Status of Devolution to Panchayats in States 2024 index rose only from 39.9% (2013-14) to 43.9% (2021-22).
- Centralisation by template. The new plans aggregate upward, but they follow central norms and 60:40 cost-sharing. The risk is that panchayats fill in templates instead of planning.
Conclusion
India has the architecture of decentralised planning. It lacks the substance, which is untied money and staff under elected control. Kerala showed the design works when a state gives up discretion, and the 16th Finance Commission’s conditions on elections and accounts push the right way. Until states treat panchayats as governments rather than agents, planning from below will stay a formality.