Panchayati Raj at Thirty: The Devolution That the Constitution Promised but States Withheld

The 73rd Constitutional Amendment, which came into force in 1993, was framed at the time as a democratic milestone comparable in ambition to the original constitutional settlement: it made panchayati raj institutions constitutionally mandatory, required regular elections every five years, reserved seats for women, scheduled castes, and scheduled tribes in proportion to their population, and directed states to devolve what came to be known, in the shorthand of decentralisation scholarship, as the three Fs, funds, functions, and functionaries, to gram panchayats, panchayat samitis, and zila parishads. Elections happen with reasonable regularity now, a genuine achievement given how irregular local body elections were before the amendment. But on the substantive question of whether panchayats actually govern, control real budgets, hire and direct staff, and make binding decisions over local development, the record across most of the country falls well short of what the amendment's architects intended.

What the Amendment Actually Left to States

The amendment's design reflected a deliberate compromise: rather than specifying exactly which functions and how much money panchayats would control, it left states to decide through their own legislation, listing twenty-nine subjects in the Eleventh Schedule that states could transfer to panchayats, covering everything from agriculture and land improvement to primary education and drinking water. This flexibility was intended to let states adapt devolution to local circumstances, but in practice it gave state governments, and more specifically state bureaucracies that had little institutional interest in ceding authority downward, wide latitude to transfer functions on paper without transferring the corresponding funds or staff needed to actually perform them.

The Kerala Exception and What It Proves

Kerala remains the most frequently cited example of what fuller devolution looks like, having transferred a substantial share of its state plan budget directly to local bodies beginning with the People's Plan Campaign in 1996, alongside genuine functional authority over local infrastructure and welfare planning. The Kerala State Planning Board's own assessments, along with independent academic studies, have credited this devolution with improving responsiveness to local needs, from drinking water schemes designed around actual local topography rather than standardised templates, to more effective targeting of welfare beneficiaries by officials with direct local knowledge. Karnataka undertook an earlier and influential decentralisation experiment in the 1980s under the Panchayati Raj Act of 1983, predating the constitutional amendment itself, which is often cited as one of the models the 73rd Amendment's drafters drew upon. West Bengal, too, built a relatively robust panchayat system from the late 1970s that, whatever its later problems with political capture, demonstrated that sustained party and bureaucratic commitment could make three-tier local government function as a genuine unit of administration rather than a ceremonial one.

Where Devolution Stalled

Most other states present a more discouraging picture. Panchayats in large parts of the Hindi heartland continue to rely overwhelmingly on funds tied to specific central schemes, MGNREGA wages, the Finance Commission's grants, rather than untied resources they can allocate according to local priorities, which leaves elected panchayat representatives functioning less as autonomous decision-makers and more as implementing agents for programmes designed entirely in Delhi or the state capital. Functionaries, the staff needed to actually execute panchayat functions, engineers, accountants, health workers, remain overwhelmingly employed by state line departments rather than by the panchayats themselves, meaning an elected sarpanch or panchayat president frequently has no authority to direct the very staff whose work determines whether local schemes succeed. The Second Administrative Reforms Commission documented this pattern in detail, describing a persistent "activity mapping" gap between functions nominally assigned to panchayats and functionaries actually placed under their control.

The Gram Sabha's Unrealised Promise

Beyond the three-tier elected structure, the amendment also envisioned the gram sabha, the assembly of all registered voters in a village, as a deliberative body that would exercise oversight over panchayat decisions and, in states that adopted it seriously, approve budgets and development plans directly. In practice, gram sabha meetings in much of the country are poorly attended, often convened primarily to fulfil a legal formality required to access certain central scheme funds rather than functioning as genuine sites of participatory decision-making. Where gram sabhas have worked well, as in parts of Kerala and in the social audit processes built into MGNREGA implementation in states such as Andhra Pradesh, they have provided real oversight of local spending and reduced corruption, which suggests the institutional design is sound even where its typical implementation has been thin.

Political Resistance From Multiple Directions

The reasons devolution stalled are not mysterious, even if they are rarely stated plainly. State legislators, particularly those representing rural constituencies, often see strengthened panchayats as direct competitors for local political credit and patronage resources, since a well-funded, empowered panchayat reduces the MLA's own role as the conduit through which local development funds and favours flow to constituents. State bureaucracies, similarly, have institutional incentives to retain control over functionaries and budgets rather than transfer them to elected local bodies with far less administrative capacity and experience managing large sums. This resistance operates independent of which party controls a state government, which is why the pattern of incomplete devolution has proven so durable across changes in ruling coalitions over three decades.

Thirty Years On, an Open Verdict

The 73rd Amendment succeeded in institutionalising regular local elections and a substantial measure of representation for previously marginalised groups within village governance, both real and lasting achievements that should not be understated. It has succeeded far less in making panchayats genuine units of self-government with the fiscal and administrative authority envisioned, because that would have required state governments to surrender exactly the kind of control over rural patronage and resources that Kerala, Karnataka, and West Bengal chose, at different points and for different political reasons, to give up. The lesson from those states is not that devolution is impossible elsewhere. It is that devolution has always been a political choice available to any state legislature willing to make it, and that most, three decades on, have simply chosen not to.