Finance Ministry releases Rs. 12,351. 5 crores for rural local bodies

The grants have been released to 18 states to improve the financial viability and for creating community assets of the Rural Local Bodies. 

Created On: Jan 27, 2021 17:09 ISTModified On: Jan 27, 2021 17:09 IST
Grants for Rural Local Bodies

The Union Ministry of Finance on January 27, 2021, released an amount of Rs. 12,351.5 crores to 18 states all over the country for providing grants to their Rural Local Bodies. The grants will be provided to all the three tiers of Panchayati Raj- Village, Block, and District.

The amount will be the 2nd installment of the basic grants which was released in the Financial Year 2020-2021. The grant by the Finance Ministry has been released to 18 states in total who provided the utilization certificate for the first installment on the recommendation of the Panchayati Raj Ministry.

Objective:

The grants by the Finance Ministry to RLBs have been released on the recommendation of the 15th Finance Commission in order to improve the financial viability and for creating community assets of the Rural Local Bodies of the 18 states. The amount will also enable the pooling of resources across blocks and villages of the states.

Two types of grants to Rural Local Bodies:

The 15th Finance Commission had recommended two types of grants to the Rural Local Bodies- RLBs.

•  Basic Grants: They can be used by the local bodies for the location-specific needs except for the salary or any other form of establishment expenditure.

•  Tied Grants: These grants are to be used by the Rural Local Bodies for the basic services of maintenance of Open Defecation Free Status and sanitation, rainwater harvesting and water cycling, the supply of clean drinking water.

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