Cabinet approves PM Viksit Gram Swaraj Yojana for 2026-31 with ₹7,395 crore outlay to strengthen Panchayat governance

The scheme will cover all states and Union territories, including traditional rural local government institutions in areas where Panchayats do not exist. (AI-generated image used for representational purpose.)AI Quick ReadThe Union Cabinet has approved the Pradhan Mantri Viksit Gram Swaraj Yojana (PM VGSY), a Centrally Sponsored Scheme aimed at strengthening village-level governance, improving development planning and making Panchayats more financially accountable.

The scheme will run from 2026-27 to 2030-31, in line with the tenure of the Sixteenth Finance Commission. It has a total outlay of ₹7,395.55 crore, comprising a central share of ₹4,869.48 crore and a state share of ₹2,526.07 crore, according to the Press Information Bureau (PIB) release dated 28 October 2026.

The initiative is expected to directly benefit around 32 lakh elected representatives, Panchayat functionaries and other stakeholders across more than 2.55 lakh Panchayats and traditional local bodies. The government also aims to reach at least one crore citizens through each coordinated public awareness exercise.

A key objective of PM VGSY is to improve coordination between central ministries, state governments and local bodies so that village development plans reflect local priorities and make better use of available funds.

Under the scheme, the government aims to support the preparation of 2.55 lakh holistic Gram Panchayat Development Plans every year through the eGramSwaraj portal. The plans will bring together village-level requirements, government interventions and available resources on a common digital platform. Existing arrangements for delivering individual government schemes will continue.

The initiative will also build on existing e-Panchayat systems to consolidate information on government schemes, beneficiaries, benefits, community assets and available resources. This is intended to help Panchayats identify gaps in development and improve the monitoring of local projects.

The scheme will support the preparation of at least 2.55 lakh online audit plans annually and the timely completion of the corresponding audits through AuditOnline. It also aims to strengthen accounting, public disclosure and the mobilisation of own-source revenue, helping Panchayats become more financially self-reliant.

The government will use existing training, digital and outreach platforms to improve awareness of public schemes and national initiatives. These efforts will include PANCHAM, an AI-enabled, multilingual, two-way communication platform available in 17 Indian languages, alongside Gram Sabhas and other Panchayat forums.

Capacity-building initiatives will focus on helping elected representatives and Panchayat functionaries use digital tools, manage resources, communicate with citizens and prepare development plans aligned with locally relevant Sustainable Development Goals.

The scheme will cover all states and Union territories, including traditional rural local government institutions in areas where Panchayats do not exist.

Implementation will be handled by state governments and Union territory administrations, which will submit annual action plans for appraisal and approval by a designated Central Empowered Committee.

The government has said the scheme will not create permanent posts. However, it may engage contractual personnel on a need basis at the state, district and block levels to provide technical support and help implement the programme.

Kirti Jha is a Senior Content Producer at Mint, where she writes on mutual funds, taxation, personal finance and macroeconomic developments. Her reporting focuses on helping readers understand complex financial developments through data-driven, research-backed stories that explain how policy changes, market trends and regulatory decisions affect investors and households. <br><br> Before joining Mint, Kirti worked at ET Money, where she specialised in mutual fund research and investment analysis. She tracked portfolio disclosures, fund manager strategies, sectoral allocation shifts and investment trends, distilling large datasets into investor-focused insights. Her work combined quantitative analysis with consumer-centric storytelling, enabling readers to better understand fund positioning, portfolio changes and long-term investment opportunities.<br><br> Kirti holds a Bachelor&#x27;s degree in Economics from Indraprastha College for Women, University of Delhi, and a Master&#x27;s in Finance from the Jindal School of Banking & Finance at O.P. Jindal Global University. Her academic training emphasised analytical thinking, quantitative research and financial decision-making, providing a strong foundation in understanding capital markets, financial systems and economic policy. With a combined experience in investment research and financial journalism, she is committed to producing accurate, accessible and insightful journalism that empowers readers to make well-informed financial decisions.

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