Cabinet Approves PM Viksit Gram Swaraj Yojana: Rs 7,395 Crore to Strengthen Gram Panchayats Till 2030-31
On 28 October 2026, the Union Cabinet approved the Pradhan Mantri Viksit Gram Swaraj Yojana (PM VGSY) as a Centrally Sponsored Scheme (a scheme run by states but partly paid for by the Centre).
The total outlay (money set aside) is Rs 7,395.55 crore for five years, from 2026-27 to 2030-31. The Centre's share is Rs 4,869.48 crore and the states' share is Rs 2,526.07 crore.
The scheme aims to build the capacity of Gram Panchayats (village councils) so that they plan and govern better. It covers over 2.55 lakh panchayats and about 32 lakh elected representatives and panchayat staff.
Every year, the scheme targets 2.55 lakh Gram Panchayat Development Plans (yearly village plans) on the eGramSwaraj portal, and at least 2.55 lakh online audit plans through AuditOnline, along with better accounting and public disclosure of panchayat money.
States and Union Territories will run it through annual action plans approved by a Central Empowered Committee. No permanent posts will be created; contract staff may be hired for technical help.
The scheme follows the Revamped Rashtriya Gram Swaraj Abhiyan (RGSA), whose approved period ran from 1 April 2022 to 31 March 2026.
Rashtriya Gram Swaraj Abhiyan (RGSA)
The Rashtriya Gram Swaraj Abhiyan (RGSA) is a scheme of the Ministry of Panchayati Raj that trains and equips panchayats to govern well. It pays for training of elected members and staff, panchayat buildings, computers and technical support. Think of it as a "skills and tools" programme for village governments, so that they can actually use the powers the Constitution gives them. Its revamped version ran from 2022-23 to 2025-26.
RGSA's approved period ended in March 2026. The new PM VGSY picks up the same job of building panchayat capacity for the next five years, with a slightly bigger outlay than the Revamped RGSA and a sharper push on digital planning and audits.
73rd Constitutional Amendment and Panchayati Raj Institutions
The 73rd Constitutional Amendment Act, 1992 gave panchayats a place in the Constitution. Before it, states could delay panchayat elections or dissolve panchayats as they liked. The amendment added Part IX (Articles 243 to 243O) and the Eleventh Schedule, and it came into force on 24 April 1993. That day is now celebrated as National Panchayati Raj Day.
The Constitution gives panchayats powers, but many lack trained staff, buildings and accounting skills to use them. PM VGSY tries to close this gap by funding training, digital planning on eGramSwaraj and online audits, so that the "funds, functions and functionaries" promised under Part IX actually work on the ground.
Centrally Sponsored Schemes (CSS)
A Centrally Sponsored Scheme is a scheme that the Centre designs and partly funds, but the states carry out on the ground. The cost is shared between the Centre and the states in a fixed ratio. This is different from a Central Sector Scheme, where the Centre pays 100% and usually runs it through its own agencies. Most schemes on state subjects like health, rural development and local government are run as CSS.
Because PM VGSY is a CSS, states must put in their own share of money and prepare yearly action plans. How well each state does this will decide how much its panchayats actually gain from the scheme.
- Scheme: Pradhan Mantri Viksit Gram Swaraj Yojana (PM VGSY), Centrally Sponsored Scheme
- Approved by the Union Cabinet: 28 October 2026
- Period: 2026-27 to 2030-31 (five years)
- Total outlay: Rs 7,395.55 crore (Centre Rs 4,869.48 crore; states Rs 2,526.07 crore)
- Coverage: over 2.55 lakh panchayats; about 32 lakh elected representatives and functionaries
- Targets per year: 2.55 lakh Gram Panchayat Development Plans on eGramSwaraj; at least 2.55 lakh online audit plans on AuditOnline
- Approval of state plans: Central Empowered Committee; no permanent posts created
- Predecessor: Revamped RGSA, 2022-23 to 2025-26, Rs 5,911 crore
- 73rd Amendment Act, 1992: Part IX, Articles 243 to 243O, Eleventh Schedule (29 subjects); in force 24 April 1993