Role of Panchayati Raj institutions in sustainable development and inclusive growth

With the GDP growth rate rising to 7–8 per cent in the last four years, rural-urban divide, regional divide and rich-poor divide became glaring, which brought ‘inclusive growth’ high on the policy agenda. Such unequal opportunity structure weakens the positive role of growth in reducing poverty and making growth inclusive. Large amounts of public funds are spent to address these issues but their implementation and the quality of services delivered leave much to be desired. The existing mechanism for the delivery of services is not effective, efficient or economical. The decentralized local government institutions are eminently suited for service delivery as they can ensure equity and/or equitability in the provision of services (in view of their nearness to the people), inclusiveness (in view of the assured representation available to all sections of the society in the Panchayati Raj Institutions), accessibility, transparency, local participation, accountability and sustainability of services. What is therefore required is that Panchayati Raj be brought centre-stage as the principal governance reform to reinforce economic reform and for delivery of essential social services at grassroots level. Improvement of service delivery by local self governments would vitally depend upon the quality of planning undertaken by these bodies. A key instrument available to Government of India is thus to provide fiscal incentives to state governments that can encourage them to strengthen local governance, in pursuance of the national strategy. Moving from a model of central provision to that of decentralization to local governments introduces a new relationship between national and local policy makers, while altering several existing relationships such as that between the citizens, elected politicians and the local bureaucracy. However, the problem of implementing decentralization is as important as the design of the system in influencing service delivery outcomes. When grass-roots planning processes strikes deep roots, economic empowerment is both strong and sustainable.