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Panchayati raj: Key to good governance and inclusion-Anil Padmanabhan
-Live Mint


It's obvious that Indian experience with local governance is not what it should have been, but a change is underway

Later this week, the country will celebrate the 20th anniversary of the constitutional amendments that made it mandatory for the creation of panchayats-the village-level bodies that deliver self-governance. Most may not be aware that this could well have been the eve of its 25th anniversary, but for the three-vote defeat that the amendments, proposed by Rajiv Gandhi in 1989, suffered in the Rajya Sabha. The narrative of the defeat of the original amendments captures the chequered progress that India has had with self-governance, a process that predates the British colonization of India.

Given the new-found enthusiasm for inclusion and the near collapse of governance, particularly at the centre, the forthcoming anniversary is an apt enough moment to reflect on the experience of local governments and also acknowledge the emerging winds of change-inspired by Aadhaar-based direct benefits transfer and the new instruments of accountability such as the right to information-that may, despite trenchant resistance, yet help realize the cherished dream of our founding fathers to empower from below.

A brilliant opening essay (introducing a collection of articles on local governments published in Economic and Political Weekly) by T.R. Raghunandan, former joint secretary in the ministry of rural development and a champion of local governments, points out that it was Mahatma Gandhi's desire that the entire edifice of independent India's democracy be based "upon one popular election to the village panchayat, indirect elections from panchayats to state assemblies, and from state assemblies to the Parliament". The fact that we are debating this today suggests that this radical idea of the Father of the Nation was quietly shelved.

While the idea of panchayats did eventually find mention in the Constitution of India, their form and substance were left largely to the discretionary powers of the state governments, till the amendments in 1993. The movement got off to a heady start when the then prime minister, Jawaharlal Nehru, launched it in Nagaur, Rajasthan, on 2 October 1959 with his usual inspirational speech: "In political life, everyone has a vote; in economic matters, everyone has equal opportunities; in our panchayats also everyone should be considered equal; there should be no distinction between man and woman, high and low."

However, two decades later, the movement was floundering and none of these objectives had been realized, till the committee on panchayati raj institutions-the Ashok Mehta committee-sought to give a new thrust and recommended in 1978 that constitutional status be accorded to panchayats-a proposal that Gandhi embraced but could not effect.

Reflecting his frustration at running into political resistance in the Rajya Sabha in May 1989 and looking to swing support, Rajiv Gandhi said, "These Bills constitute the most significant systemic transformation in the governance of the Indian polity since the constitution entered into force-not only instruments for bringing democracy and devolution for every chaupal and every chabutra, to every aangan and every dalan. They are also a charter for ending bureaucratic oppression, technocratic tyranny, gross inefficiency, bribery, nepotism, corruption, and the million other malfeasances that affect the poor of our villages, towns and cities." (Ironical that 24 years later, despite the constitutional amendments providing institutional status to panchayats, his son and political heir Rahul Gandhi rails very much on the same ailments of crony capitalism; guess some things simply don't change.)

Disconcerting yes, but a series of new developments suggest that change that could potentially empower the local bodies and thereby alter their political relationship and their existing dependence on the top two tiers-the union and the states-is underway.

A small step was initiated in 2010 by the 13th Finance Commission chaired by Vijay Kelkar to launch the third tier of government, panchayats and urban bodies, on the path of fiscal independence; it added around 2.5% (the proportion varies annually) to the divisible pool of resources between the centre and states, but earmarked it for local bodies. "Taking into account the demand of local bodies that they be allowed to benefit from the buoyancy of central taxes and the constitutional design of supplementing the resources of panchayats and municipalities through grants-in-aid, we recommend that local bodies be transferred a percentage of the divisible pool of taxes (over and above the share of the states), as stipulated by us," the commission said.

While clearly much more needs to be done here, it is also heartening to note that the proposal to move to direct benefits transfer would cut at the innards of the present delivery system that vests discretion (and thereby creates the circumstances for fostering corruption, something that Gandhi flagged) in the hands of various intermediaries. At the moment, it is a work in progress, but over the next five years, it should gradually gain momentum and further alter the changing nature of the relationship between the top and bottom tiers of governance.

At the same time, the rapid growth of urbanization and influx of migrants overflowing with aspirations is forcing greater accountability. Officially, about 33% of India is classified to be living in urban areas; however, if we take into account the so-called census towns (that mimic towns, but are overgrown villages governed by village-level bodies), the proportion is closer to 50%. Through the use of instruments such as the Right to Information, people are increasingly maintaining a closer scrutiny of government programmes and obviously their elected representative.

In the final analysis, it is obvious that the Indian experience with local governance is not what it should have been. The good news is that change is underway; at the least, we are seeing the beginning of the end of business as usual.

Anil Padmanabhan is deputy managing editor of Mint and writes every week on the intersection of politics and economics.