Introduction and the Necessity of Local Governments

In a large and diverse democracy like India, merely having elected governments at the Central (Union) and State levels is insufficient for complete governance. Democracy requires the presence of elected government bodies even at the local level to effectively manage local affairs and ensure broad participation.

Defining Local Government and its Significance

Local government refers to the tier of administration that operates closest to the general population—typically at the village, town, or district levels. These governing bodies are directly engaged in addressing the everyday needs and immediate concerns of citizens. The fundamental principle underlying local governance is that local knowledge and community-specific interests are essential for effective and participatory democratic decision-making.

Local government provides notable advantages by making administration more efficient, responsive, and people-oriented. Owing to its proximity to the community, citizens can easily approach local authorities to resolve issues swiftly and at minimal cost.

Objectives of Studying Local Governments

This study of local governments aims to achieve three primary objectives :

●   To understand the fundamental importance of local government bodies in the democratic structure.

●   To examine the specific constitutional provisions introduced by the  and  Amendments.

●      To analyze the mandated functions and responsibilities assigned to these decentralized bodies.

Local Level Transformation: Case Studies

The constitutional recognition in 1993 triggered large-scale transformation.

Geeta Rathore (Jamonia Talab, Madhya Pradesh): Elected as Sarpanch in 1995 on a reserved seat and re-elected in 2000 on a non-reserved seat, Geeta Rathore demonstrated exemplary leadership and community commitment. Her tenure was marked by significant development initiatives, including the renovation of water tanks, construction of roads and a school, advocacy against domestic violence, and promotion of sustainable water management practices. Her work exemplifies dedicated participation and the transformative potential of women’s leadership in local governance.

Vengaivasal (Tamil Nadu): In 1997, the Gram Panchayat President and members of Vengaivasal refused to comply with a District Collector’s directive to endorse land allotments to government employees, viewing it as an overreach of authority. They petitioned the Madras High Court, where a Division Bench overturned a single judge’s earlier ruling, declaring the Collector’s action a “gross violation of the constitutional status of the Panchayats.” This case underscores the assertion of local autonomy, the defense of constitutional rights, and the role of Panchayati Raj institutions in ensuring administrative accountability.

Importance: Participation and Accountability

Strong local governments ensure active participation and purposeful accountability.

1. Principle of Subsidiarity: Democracy demands that tasks which can be performed locally be delegated to local representatives. Local actions have a direct bearing on daily life, thus strengthening local government strengthens the democratic process.

2. Democratic Participation: Local government is the primary level where ordinary citizens can be directly involved in decision-making concerning their needs and development.

Historical Growth of Local Government in India

Ancient Roots and Early Modern Initiatives

The concept of self-governance at the community level is ancient in India. It is believed that self-governing village communities existed from the earliest times in the form of ‘sabhas’ (village assemblies). These later evolved into Panchayats (an assembly of five persons) responsible for resolving village issues.

In the modern era, elected local government bodies began to be created after 1882. Lord Rippon, who served as the Viceroy of India, took the initiative to establish these institutions, which were initially known as the local boards.

Due to the slow progress of these boards, the Indian National Congress (INC) pressed the colonial government to take necessary steps to enhance the effectiveness of all local bodies. This pressure led to the establishment of village panchayats in several provinces following the Government of India Act 1919, a trend that continued after the Government of India Act of 1935.

The National Movement and Constitutional Debate

1. Mahatma Gandhi’s Call for Decentralisation

During India’s struggle for independence, Mahatma Gandhi emerged as a strong proponent of decentralising both economic and political power. He firmly believed that empowering village panchayats was the most effective way to promote decentralisation and ensure participatory democracy. Gandhi maintained that development initiatives could only succeed when they actively involved the local population in decision-making and implementation. The broader objective of the national movement was to challenge the excessive concentration of authority vested in the Governor-General in Delhi, thereby making decentralisation a fundamental promise of India’s independence.

The philosophy of governance starting from the grassroots was captured eloquently by Mahatma Gandhi:

Quote from Mahatma Gandhi:

“The independence of India should mean the independence of the whole of India…Independence must begin at the bottom. Thus every village will be a republic… It follows therefore that every village has to be self-sustained and capable of managing its affairs. In this structure composed of innumerable villages, there will be ever-widening, ever-ascending circles. Life will be a pyramid with the apex sustained by the bottom”.

2. The Initial Constitutional Status Dilemma

When the Constitution of India was originally drafted, the responsibility for local government was placed under the jurisdiction of the States. Moreover, the concept of organizing village-level governance was included in the Directive Principles of State Policy (DPSP) through Article 40, which urged the State to “take steps to organize village panchayats and endow them with such powers and authority as may be necessary to enable them to function as units of self-government.” However, as part of the DPSP, this provision was non-justiciable and advisory in nature, implying that while governments were encouraged to promote local self-governance, they were not constitutionally obliged to implement it.

It is argued that the subject of local government did not receive adequate importance during the drafting of the Constitution for key reasons:

●   Jawaharlal Nehru’s Unitary Inclination: The severe turmoil caused by the Partition fostered a strong inclination toward a unitary state structure to ensure national stability. Prime Minister Nehru viewed extreme localism as a potential threat to national unity and integration.

●      Dr. B.R. Ambedkar’s Social Concerns: Dr. Ambedkar led a prominent voice in the Constituent Assembly that harbored concerns that the pre-existing factional and caste-ridden nature of rural society would ultimately undermine the democratic and noble objectives of local government.

Despite these major reservations, the importance of people’s participation was widely acknowledged. Many members still wished for Village Panchayats to form the fundamental basis of Indian democracy, even while recognizing the internal ills present in village society. This hopeful perspective was expressed by a member of the Constituent Assembly:

Quote from Ananthasayanam Ayyangar:

“… in the interests of democracy. the villages maybe trained in the art of self-government, even autonomy… We must be able to reform the villages and introduce democratic principles of government there…”.

Post-Independence Efforts Before the Amendments (1952-1989)

Local governance received significant impetus even before the constitutional amendments of 1992.

1.  Community Development Programme (1952): The first major step taken by the independent government was the introduction of the Community Development Programme in 1952, designed to promote people’s participation in various local development activities.

2.  The Three-Tier System: Following the CDP, a three-tier Panchayati Raj system of local government was recommended for rural areas.

3.  Early Adopters and Failures: Some States, notably Gujarat and Maharashtra, adopted elected local bodies around 1960. However, in most parts of the country, these local bodies were severely weak. They lacked sufficient powers and functions for local development and remained heavily dependent on financial assistance from the State and Central governments.

4.  Political Fragility: Prior to 1992, local government was highly vulnerable to political manipulation. Many States failed to establish elected bodies, others dissolved them and replaced them with government officers, and elections were frequently postponed or conducted indirectly. This inconsistency demonstrated that without constitutional protection, local bodies could not thrive.

5.     P.K. Thungon Committee (1989): A thorough review initiated after 1987 led to the P.K. Thungon Committee’s recommendations in 1989. This committee strongly advised constitutional recognition for local government bodies, along with a constitutional amendment to mandate periodic elections and ensure the enlistment of appropriate functions and funds.

The Constitutional Mandate:  and  Amendments

The repeated failures of earlier, non-mandatory efforts at decentralisation underscored the need for a centralised, constitutional mandate to ensure genuine institutional reform. Responding to this necessity, the Central Government introduced two constitutional amendment bills in 1989, which were subsequently enacted by Parliament in 1992 and came into effect in 1993. These landmark amendments sought to strengthen local governments across the country and establish a uniform framework for their structure, powers, and functioning.

Since local governments fell under the State List, the amendments required all States to amend their respective laws on local bodies within one year to bring them into alignment with the new constitutional provisions.

●   The  Amendment pertains to rural local governments (Panchayati Raj Institutions or PRIs).

●      The  Amendment deals with urban local governments (Nagarpalikas).

 Comparative Model: Constitutional Protection in Brazil

To fully appreciate the extent of constitutional protection envisaged by these amendments, it is instructive to examine the Brazilian model. The Constitution of Brazil establishes a three-tier system of government comprising the Union (federal government), the States and Federal District, and the Municipal Councils. Each level is endowed with independent powers, responsibilities, and jurisdiction, forming a robust federal structure. Notably, the Constitution explicitly prohibits State governments from interfering in the affairs of Municipal Councils, thereby guaranteeing a high degree of local autonomy—analogous to the manner in which the national government is restrained from encroaching upon the powers of the States.

Key Provisions of the  Amendment (Rural Governance)

The amendment introduced fundamental and mandatory structures for rural local governance across India, establishing a uniform framework for the Panchayati Raj system.

1. Uniform Three-Tier Structure

All States are now constitutionally required to implement a three-tier Panchayati Raj structure:

• Base Level: Gram Panchayat – representing a single village or a group of villages.
• Intermediate Level: Mandal, Block, or Taluka Panchayat – this level is optional for smaller States, depending on population size and administrative feasibility.
• Apex Level: Zilla Panchayat (or District Panchayat) – covering the entire rural area of a district.

2. The Mandatory Gram Sabha

The amendment mandated the establishment of the Gram Sabha, which serves as the foundation of local democracy. It comprises all adult residents registered as voters within the jurisdiction of a Gram Panchayat. While the Constitution recognizes the Gram Sabha as a central democratic institution, its specific powers and functions are defined through State legislation.

3. Elections and Duration

To safeguard the democratic process and ensure institutional continuity, the amendment formalized and constitutionally protected elections to local bodies:

• Direct Elections: Members of all three tiers of Panchayati Raj institutions are elected directly by the people.
• Fixed Term: Each Panchayat body serves a five-year term.
• Electoral Certainty: If a State government dissolves a Panchayat before its term ends, fresh elections must be held within six months of dissolution. This provision eliminated the earlier practice of indefinite postponement of local elections.

Functional and Financial Framework of the  Amendment

Comprehensive Reservation Policy

●      SC/ST Reservation: Seats and positions of Chairpersons (‘Adhyakshas’) are reserved at all three levels in proportion to their population.

●      Women Reservation: One-third (1/3) of all positions, including Chairpersons, are mandatorily reserved.This reservation also applies within seats reserved for SC/ST (e.g., a Dalit woman Sarpanch).

●      OBC Reservation: States have the discretion to legislate for the reservation of seats for Other Backward Classes (OBCs).

Transfer of Subjects: The Eleventh Schedule

●      The 29 Subjects: The  Amendment added the Eleventh Schedule, listing twenty-nine subjects related to local development/welfare.

●      Implementation (Article 243G): Article 243G stipulates that the State Legislature may transfer powers related to these subjects to Panchayats. The actual devolution depends on specific State legislation.

Key Subjects (Examples): Agriculture, Minor irrigation, Small scale industries, Rural housing, Drinking water, Roads, Rural electrification, Poverty alleviation, Education (primary/secondary), Health/sanitation, Family welfare, Welfare of SC/ST, Public distribution system.

Special Provisions for Tribal Areas (PESA Act, 1996)

The original  Amendment provisions were not applicable to Adivasi populations in Scheduled Areas. The Panchayats (Extension to Scheduled Areas) Act (PESA) was passed in 1996 to extend the system with modifications. PESA protects the traditional rights/customs of Adivasi communities in managing common resources (forests, water). Gram Sabhas in these areas are granted more powers and their consent is required for many decisions.

 Institutional Autonomy: SEC and SFC

1. State Election Commission (SEC)

The amendment mandates the establishment of an independent State Election Commission (SEC) in every State to ensure the free, fair, and timely conduct of elections to the Panchayati Raj Institutions (PRIs). The State Government is required to appoint an autonomous State Election Commissioner, responsible exclusively for supervising, directing, and controlling local body elections. This institutional safeguard prevents political interference or postponement of elections. Importantly, the SEC functions independently and is not subordinate to the Election Commission of India.

2. State Finance Commission (SFC)

To strengthen the fiscal foundation of local self-government, the amendment also provides for the constitution of a State Finance Commission (SFC) every five years. Appointed by the State Government, the SFC is tasked with reviewing the financial position of Panchayati Raj Institutions. Its principal functions include recommending:

• The distribution of financial resources between the State and local governments.
• The allocation of funds among different tiers of Panchayati Raj.
• The assignment of taxes, duties, and fees to local bodies.
• The principles governing grants-in-aid from the State to local governments.

The  Amendment: Urban Local Governments (Nagarpalikas)

The  Amendment deals with urban local bodies (Nagarpalikas).

Defining an Urban Area

The Census of India defines an urban area based on three criteria :

1.     Minimum population of 5,000 persons.

2.     At least 75 per cent of the male working population engaged in non-agricultural occupations.

3.     A density of at least 400 persons per square kilometer.
 As per the 2011 Census, 31% of India’s population lives in urban areas.

Structural Uniformity

The  Amendment replicates the  framework: direct elections, fixed five-year tenure (with re-election within 6 months of dissolution), mandatory reservations for women (1/3) and SC/ST (proportional), and mandatory SEC/SFC.

Transfer of Subjects: The Twelfth Schedule

The Constitution mandated the transfer of specific urban functions, listed in the Twelfth Schedule, detailing 18 functional items.

●      Key Functions (Examples): Urban planning, Regulation of land-use, Roads/bridges, Water supply, Slum improvement/upgradation, Urban poverty alleviation, Public health/sanitation, Solid waste management, Vital statistics (births/deaths), Public amenities (street lighting, bus stops).

 Implementation, Outcomes, and Challenges

The implementation of the 73rd and 74th Constitutional Amendments began in earnest after 1993, marking a historic transformation in India’s governance structure. These amendments institutionalized democratic decentralization by granting constitutional status to rural and urban local bodies. Following their enactment, all States enacted the necessary legislation to bring their local governance systems into conformity with the new constitutional framework. Within the first decade of implementation (1994–2004), most States had conducted at least two rounds of local elections, while pioneering States such as Madhya Pradesh and Rajasthan successfully held three rounds, demonstrating steady progress in embedding local democracy across the country.

Scale and Democratization of Representation

The sheer scale of local government institutions is profound, significantly deepening democratic representation across the country.

Across India, more than 3.2 million (32 lakh) representatives are elected to local bodies every five years. This figure stands in stark contrast to the fewer than 5,000 elected representatives who serve in the State Legislative Assemblies and the Parliament combined, underscoring the remarkable expansion of India’s democratic base. The uniform institutional framework established through the 73rd and 74th Constitutional Amendments has thus created a nationwide platform for participatory democracy, enabling citizens to engage directly in governance and decision-making at the grassroots level.

Changing Social Profile and Empowerment

The reservation provisions introduced through the 73rd and 74th Constitutional Amendments have fundamentally reshaped the social composition and leadership structure of local governance in India. By mandating representation for women, Scheduled Castes (SCs), and Scheduled Tribes (STs), these reforms have democratized access to political power and enhanced the inclusivity of decision-making at the grassroots level.

1. Women’s Leadership

The mandatory reservation for women has ensured the election of over 1.3 million (13 lakh) women representatives across rural and urban local bodies. Significantly, the reservation of seats for Chairpersons has placed a substantial number of women in leadership positions — including more than 80,000 women Sarpanchas, around 2,000 women Presidents of Block or Taluka Panchayats, and at least 200 women Adhyakshas in Zilla Panchayats. In urban governance, there are also over 30 women Mayors leading municipal corporations.

This widespread political participation has been empowering for women, fostering confidence, political awareness, and leadership capacity. Women leaders frequently bring new perspectives and heightened sensitivity to issues concerning community welfare, education, health, and local infrastructure. Although the early years witnessed instances of women serving as proxies for male relatives, such cases have gradually declined as women have gained greater control over resources and decision-making.

2. Scheduled Caste and Scheduled Tribe Representation

Reservations for Scheduled Castes (16.2% of the population) and Scheduled Tribes (8.2%) have resulted in the election of approximately 660,000 (6.6 lakh) representatives from these communities to local bodies. This deliberate inclusion has made Panchayati Raj Institutions and urban local bodies more socially representative of the communities they serve, ensuring that marginalized voices are integrated into governance.

3. Intensification of the Democratic Struggle

The transformation in the social composition of local governance has inevitably challenged entrenched power structures. Traditional elites, who once dominated village affairs, often resist sharing authority with newly empowered groups. This has, at times, led to tensions and conflicts at the local level. However, such struggles are widely regarded as an inevitable — and even constructive — aspect of deepening democracy, reflecting the ongoing process of redistributing power and promoting social justice within India’s democratic framework.

Challenges to Effective Functioning

Despite the successful establishment of institutions and the increase in representation, local governments face structural limitations that impede their effectiveness, creating a significant gap between the legal mandate and the practical reality.

1. Limited Functional Autonomy

Although the 73rd Amendment assigned 29 subjects to local governments, many States have failed to fully transfer most of these functions. This means local bodies often lack the real authority to perform the tasks assigned to them constitutionally. Consequently, the entire process of electing representatives sometimes becomes symbolic, as local decision-makers possess limited power to choose welfare programmes or allocate local resources.

2. Crippling Financial Dependence

The greatest impediment to local autonomy is financial fragility. Local bodies typically generate very little revenue on their own. Rural local bodies, for instance, raise only 0.24% of the total revenues collected nationwide, yet they account for 4% of the total government expenditure. This substantial fiscal gap means local bodies are overwhelmingly dependent on grants from the State and Central governments for survival, an economic vulnerability that greatly reduces their capacity to operate independently and efficiently.

Comparative Model: Financial Autonomy in Bolivia

Bolivia is widely regarded as one of the most successful international examples of democratic decentralisation, primarily due to the strength and reliability of its fiscal framework.

1. Decentralisation Mechanism

Bolivia’s Popular Participation Law (1994) institutionalized decentralisation by enabling the direct election of mayors and establishing 314 municipal governments across the country. Each municipality is governed by an elected mayor (Presidente Municipal) and a municipal council (Cabildo), with elections held every five years. These local governments are entrusted with the construction, maintenance, and management of essential infrastructure, including local health centres, educational institutions, and community facilities. This structure ensures that governance remains close to the people and responsive to local needs.

2. Automatic Fiscal Transfers

The cornerstone of Bolivia’s decentralisation success lies in its robust fiscal mechanism. Under this system, 20% of the nation’s total tax revenue is automatically distributed among municipalities on a per capita basis. While local governments may also levy taxes on urban property and motor vehicles, these non-political, automatic fiscal transfers constitute the primary source of their financial resources. This model ensures predictable and equitable funding, empowering municipalities to plan and implement development projects independently. By guaranteeing a stable flow of funds, Bolivia has avoided the fiscal dependence and uncertainty that often constrain local bodies in India.

Conclusion: Assessing the Democratisation of Power

The experience since 1993 demonstrates that, despite the constitutional mandate for decentralisation, local governments in India often continue to operate primarily as implementing agencies for welfare and development schemes designed by the Central and State governments. This limited autonomy constrains their ability to function as true instruments of self-governance.

For effective local self-government to be realized, there must be a genuine commitment to the practical decentralisation of power. Democracy at the grassroots level can only flourish when citizens in villages and urban localities have real decision-making authority over policies, programmes, and the allocation of local resources.

The 73rd and 74th Constitutional Amendments represent a landmark legal and institutional step toward the democratisation of power in India. Yet, the ultimate test of democracy lies not in the mere existence of constitutional provisions, but in their authentic and consistent implementation—through the active participation of citizens, the political will of governments, and the collective effort to nurture accountable and empowered local institutions.

Summary of Key Constitutional Amendments (1992)