Constitutional Base for Panchayati Raj in India: The 73rd Amendment Act

Author(s): Hoshiar Singh

Source: Asian Survey , Sep., 1994, Vol. 34, No. 9 (Sep., 1994), pp. 818-827
Published by: University of California Press

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CONSTITUTIONAL BASE FOR
PANCHAYATI RAJ IN INDIA
The 73rd Amendment Act

Hoshiar Singh

After independence local panchayats (councils) were es-

tablished by most of the state governments in India. Mahatama Gandhi had
argued for village self-sufficiency (gram swaraj) to be the aim of independ-
ent India but the chairman of the Constitution drafting committee, B. R.
Ambedkar, opposed village panchayats and only lip service was paid to the
concept in the draft of the Constitution. When Gandhi became aware of this,
he insisted on the inclusion of the principle of village panchayats, and as a
result of his efforts, a provision was included in the Constitution's Directive
Principles of State Policy (Article 40) stating that "the State shall take steps
to organize village Panchayats and endow them with such powers and author-
ity as may be necessary to enable them to function as units of self-govern-
ment." This article describes conceptual aspects of the panchayati raj (local
government), its workings and shortcomings, and discusses features of the
73rd Constitutional Amendment Act of 1993.
To make Article 40 operational, the Balwantrai Mehta Committee was ap-
pointed in 1957 to study implementation of the panchayati raj. As a result of
its recommendations, a three-tier panchayati raj was introduced: the gram
panchayat at the village level, panchayat samiti at the block or intermediate
level, and zilla parishad at the district level. All three units were organically
linked, as the chairmen of lower level bodies were ex-officio members of the
higher levels. These councils were to undertake all planning and develop-
ment work, and the Mehta committee noted that the "Panchayati Raj system
establishes a linkage between local leaderships enjoying the confidence of
local people and the government, and translates the policies of the govern-

Hoshiar Singh is Professor and Chairman, Department of Public Ad-

ministration, Kurukshetra University, Kurukshetra, Haryana, India.

? 1994 by The Regents of the University of California

818

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 HOSHIAR SINGH 819

ment into action."' Thus, village panchayats were made subordinate units of
the government to implement its programs at the lowest levels, and not the
agencies of self-government or gram swaraj as Gandhi had advocated.
Slowly, the panchayati raj lost its glamour, and the people's participation
weakened as regular elections to the various panchayats were not held.
In 1977 the Janata Party government came to power with an expressed
interest in assigning a meaningful role to the panchayati raj. It tried to rev
talize its institutions and appointed a committee in December 1977 under the
chairmanship of Ashok Mehta to suggest a viable organization of grass-roots
councils to mobilize the participation and active support of the people. In its
1978 report, a landmark in the history of panchayati raj (hereafter PR), the
committee suggested structures with a development orientation at two
levels-district panchayats and Mandal panchayats (covering 15,000 to
20,000 people) at the grass-roots level. Its other recommendations were the
open participation of political parties in PR elections and constitutional pro-
tection to further extend decentralization of power. The committee recom-
mended that PR institutions participate in development activities in the areas
of agriculture, forestry, cottage industries, welfare activities, and the like.
With the expansion of antipoverty programs in the 1980s and the creation
of district rural development agencies (DRDA) and other similar organiza-
tions at lower levels, it was necessary to integrate the PR system with these
programs. The C. H. Hanumath Rao Working Group on District Planning
was set up in 19832 and then the G. V. K. Rao Committee in 1985 to review
the existing administrative arrangements for rural development and poverty
alleviation programs.3 The latter recommended strengthening the zilla par-
ishad level, endorsed the recommendations for district-level planning of C.
H. H. Rao's working group, and suggested better integration of bloc and
lower-level planning with lower-level PR councils. Another committee
headed by L. M. Singhvi in 1986 prepared the concept paper on panchayati
raj4 that said PR institutions should be closely involved in the planning and
implementation of rural development programs at lower levels, and recom-
mended that the panchayats should be made financially viable by combining
two or three villages in one Mandal panchayat. It also supported the recom-

1. Report of the Committee on Plan Projects, vol. 1 (New Delhi: Planning Commission,
1959), p. 5.
2. Report of the Working Group on District Planning, vol. I and 2 (New Delhi: Planning
Commission, 1983).

3. Report of the Committee to Review the Existing Administrative Arrangements for Rural
Development and Poverty Alleviation Programmes (CAARD) (New Delhi: Department of Rural
Development, Ministry of Agriculture, 1985).

4. Concept paper on Panchayati Raj, Ministry of Agriculture, New Delhi, 1987.

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 820 ASIAN SURVEY, VOL. XXXIV, NO. 9, SEPTEMBER 1994

mendations of the G. V. K. Rao committee for integration of the govern-

ment's administrative structures with the PR institutions.
Thus, the concept of PR has undergone changes since its inception, ex-
panding to cover areas of rural development and economic planning but it is
still suffering from a number of shortcomings. First, the present concept does
not consider PR bodies as agencies that can play an important role in the
overall development of rural areas, that is, not as planning and implementa-
tion agencies for various rural development programs. Second, there is no
clarity about the relationship between PR bodies and development adminis-
tration, because the former has no separate cadre of administration. The dual
responsibility of the central administration toward state departments and PR
bodies creates confusion and complications. Third, there is no systematic
method to involve the "weaker" sections in the functioning of PR bodies.
There is a feeling that PR leaders do not involve the poor in the councils and,
therefore, the administration has to intervene to provide the benefits of
growth to the poor; on the other hand, the involvement and control of
panchayat officeholders in rural development activities is increasing continu-
ously. Finally, no clear trend is emerging on decentralization of power.
There is a lot of talk about decentralization to district and lower-level bodies
but central government schemes are increasing both in number and in size,
raising questions about the kind of decentralization that is projected. In spite
of these shortcomings, the panchayati raj has great potential and capacity to
play a major role in the overall development of the economy and polity of a
big country such as India.

Workings of Panchayati Raj

The workings of PR institutions during the past three decades have produced
two views. One is that PR functionaries, political as well as administrative,
are interested in power politics and the distribution of patronage, creating
tensions in village communities. They have failed to protect the interests of
the poor and even failed to protect and strengthen the planning process at the
micro level, such as in the development of agriculture, minor irrigation sys-
tems, social welfare, and so on. The other point of view attributes the limited
success of panchayati raj to lack of money, lack of cooperation from govern-
ment departments, half-hearted policies overly penetrated by state authorities
from above, and the defective structure of PR institutions.
In the beginning, the PR system worked successfully in some states-
Rajasthan, Maharashtra, Gujarat, Andhra Pradesh-but within ten years it
became apparent that panchayat performance was not what it was portrayed
to be. Studies showed that the benefits of development were being cornered
by organized vested interest groups in the PR bodies at the expense of the
rural poor. Research conducted by scholars in various states as well as by

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 HOSHIAR SINGH 821

some state level and all-India committees made it clear that the councils were
not fulfilling the expectations of rural people. Karnataka and West Bengal
experiments in the PR system have been cited as success stories,5 with the
zilla panchayats in Karnataka said to be emerging as a power center below
the state. But studies by George Mathew and Gurumurthy,6 have shown that
power in the districts is enjoyed mainly by dominant castes and that the inter-
ests of the poor are sacrificed to the interests of the district leadership.7 The
West Bengal study also shows that the panchayati raj bodies have been inef-
fective in getting benefits to percolate down to the poor in the villages.8 The
study by Hirway clearly shows that the socioeconomic power structure in
rural areas does not allow the benefits of the PR system to flow toward the
weaker sections9; rather, the benefits are going to the dominant castes in the
panchayats. It became very clear that the PR is working for elite groups or
for groups of big farmers and rich businessmen, and the system has thus lost
its appeal.

Reasons for PR Decline

On the basis of the literature available on operational aspects of the
panchayati raj, the reasons for the system's decline are many but the pol
repercussions of electoral competition between state and PR representatives
are largely responsible. State level leaders began to see these local institu-
tions as rivals, and they started withdrawing important functions from them,
making them dumping grounds for discarded state cadre administrative of-
ficers. Most of the extension and development functions were taken away by
amendments to relevant acts. For example, development of land, water, for-
est, and grazing land, animal husbandry, and rural health should be in the
hands of PR bodies but instead are controlled by state-level departments.
Such an irrational approach in functional distribution has diminished the sys-
tem, as have PR elections that were repeatedly postponed on flimsy grounds.
As a result, people have lost faith in these institutions.

5. Prabhat Kumar Datta, "Democratising Rural Administration: The West Bengal Experi-
ence," Indian Journal of Administrative Science, 1:1 (January-June 1990), pp. 144-64.
6. George Mathew, ed., Panchayati Raj in Karnataka Today (New Delhi: Concept Publishing
House, 1985); U. Gurumurthy, Panchayati Raj and the Weaker Sections (New Delhi: Ashish
Publishing House, 1987).
7. See Amal Ray, "New Panchayats System in Karnataka: Elections and After," EPW, Febru-
ary 14, 1987.
8. G. K. Lieten, "Caste, Gender, and Class in Panchayats: Case of Barddhaman, West Ben-
gal," EPW, July 18, 1992.
9. Indira Hirway, Abolition of Poverty in India with Special Reference to Target Group Ap-
proach in Gujarat. (New Delhi: Vikas Publishing House, Ltd., 1986). See also A. Inbanathan,
The New Panchayati Raj in Karnataka: An Evaluation (New Delhi: Institute of Social Sciences,
1992).

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 822 ASIAN SURVEY, VOL. XXXIV, NO. 9, SEPTEMBER 1994

Political considerations played a major role in patronage distribution and

the PR bureaucracy, and Branch Development Officers (BDOs). were not
free to make objective decisions in distributing and administering annual
grants to various panchayats. The state went even further by creating parallel
alternative structures for rural development functions; for example, the Dis-
trict Rural Development Agency (DRDA), a Sixth Plan creation, was made
responsible for a variety of programs. Overlapping committees at the district
level, comprising members of both Parliament and the state assemblies, are
functioning; various leading banks provide financing for different schemes
(outside the PR structure); and a multiplicity of departmental organizations
exist side by side. In practice, the plethora of rural development programs
and projects implemented under the control of central/state governments has
minimized the scope in which PR bodies can function.
The capacity of PR institutions is further hampered by inadequate financ-
ing. Most of their support comes from the state and central governments,
both of whom prefer to spend their resources through their own organiza-
tions, which have been created at every level. The penetration of state au-
thority through the use of stringent controls over the dissolving and
superseding of PR institutions also undermines the system. Even elected
sarpanches (heads of local PR units) have been suspended or removed by the
government on flimsy grounds. The worst part of politicization has been the
dumping of inefficient state officials into the PR bodies as their managers.
Personnel with the expertise required for the planning, implementation, and
monitoring of various programs and development schemes are not assigned
to PR institutions. The result has been administrative chaos. The bureaucrats
sent to PR units are not only unqualified but are usually opposed to the sys-
tem itself; they do not want to be subordinate to elected PR leaders, and they
have created several obstacles to the smooth working of these institutions.
The most dangerous trend is the undermining of the authority and importance
of PR in terms of power relations. State-level organizations curb and blight
the development of PR bodies and try to show that, compared to them, PR
institutions have very little power. The legislators representing an area who
belong to the party in power demonstrate that they are above the panchayats
and the PR institutions. Their proximity to, and linkages with relevant minis-
ters provide them with ample power to create a psychological environment
that tends to increase their following at the cost of PR officials. Moreover,
the elected ranches, sarpanches, pradhans, and zilla pramukhs have received
no training and do not know how to make the system work for the welfare of
the people.
How to make PR effective and successful is a difficult question. A com-
prehensive concept of panchayati raj is needed, one that has a political
well as development and planning components. PR has to work as an agency

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 HOSHIAR SINGH 823

of decentralization, with political and administrative powers to encourage and

develop mass participation and self-governance. Further, it needs to
strengthen the planning process at the micro level for overall rural develop-
ment and provide opportunities for the poor to participate in decision-making
in PR bodies. Such a concept will require many steps-multi- and micro-
level planning, integration of PR institutions into the planning and adminis-
trative processes of local areas, and organization of the poor to protect them
from exploitation by the rich in rural areas, as occurs at present. As for prac-
tical measures that could be implemented to improve conditions for the peo-
ple as well as the status of panchayati raj, the following are the most
obvious:
(1) Arrangements for social security, bank loans, and an effective public dis-
tribution system for food grains, clothing, and other necessary items to
reduce dependency of the poor on money lenders and exploiters.
(2) Continuous employment for the rural poor in development programs, and
minimum wages.
(3) Distribution of diesel pumps, gas agencies, fertilizers, and pesticides to
the weaker sections in rural areas; also access to common property re-
sources for the poor.
(4) Encouragement of organizations of the rural poor so they can assert their
rights.

(5) Provision to PR bodies of a unified administrative set up created exclu-

sively for rural development. This cadre should be protected from un-
wanted political pressures by appropriate transfer and promotion policies
and regulations. Training of PR members about their roles is also essen-
tial for the system's success.

The 73rd Amendment

The Constitutional (73rd) Amendment Act 1993 has a checkered history. It
took nearly three years for the legislative bill to emerge as an act, beginning
with the Rajiv Gandhi government's introduction of a panchayati raj bill in
1989. That measure was passed by the Lok Sabha but failed to gain the
requisite majority in the Rajya Sabha (upper house). The V. P. Singh govern-
ment tried to push a PR bill in 1990, but it lapsed with the dissolution of the
Lok Sabha. In 1991 the present Congress (Rao) government again intro-
duced a bill on panchayati raj with some modified provisions; it was refe
to a select committee, then was considered by a joint parliamentary commit-
tee, and finally went to the full Parliament. It was passed by the Lok Sabha
on December 22, 1992, and by the Rajya Sabha on the following day. After
ratification by 17 state assemblies, including West Bengal and Bihar (both
opposition-ruled states), the president signed the bill and it went into effect

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 824 ASIAN SURVEY, VOL. XXXIV, NO. 9, SEPTEMBER 1994

on April 24, 1993. Some states have now implemented the Act and others
are in the process of doing so.
The constitutional base for PR was required because state governments
were not enthusiastic about the creation of PR bodies and having to share
power with them. In fact, some states have taken power back from PR bod-
ies. Status and dignity are essential to make these bodies viable and respon-
sive institutions, and this requires constitutional support. In India's Constitu-
tion, local self-government and panchayati raj was a state subject, and the
central government could not pass any legislation concerning them. Hence,
the 73rd Constitutional Amendment Act.
The main characteristics of the Act are: (1) establishment of a gram sabha
comprising all the voters in the panchayat area, and establishment of a three-
tier PR system (except in states whose population is under 2,000,000) with
panchayats at the village, intermediate, and district levels; (2) provision for
direct election by the people of the members of all panchyats; (3) provision
that members of the Lok Sabha/Rajya Sabha (MPs) and the state Legislative
Assembly (MLAs) from the area would continue to be members of
panchayats with the right to vote in their meetings but not in the election of
chairpersons of intermediate and district level panchayats, nor to be those
chairpersons; (4) establishment of five-year terms for each panchayat, with
elections to be held under the supervision, direction, and control of the state
election commission, and if superseded in midterm, an election to be held
within six months for the remaining period of the five-year term only.
The Act also provided for the reservation of seats for Scheduled Castes
(SC) and Scheduled Tribes (ST) in proportion to their population in a
panchayat area, and has further reserved chairperson seats for SC and ST
candidates in all three tiers in direct proportion to their total population in the
state, with one-third of these seats reserved for SC and ST women. The 1993
Act also provides that one-third of the seats in the panchayats at all levels
will be reserved for women, including SC and ST women. It directs the
states to carry out that reservation by rotation in every panchayat at each
level. It has left to the states the question of reserving seats for backward
classes.
Financial paucity has been one of the main causes of PR failure in the past,
and to remove this hurdle, the panchayats have been empowered to levy and
collect appropriate taxes, duties, tolls, and fees and are entitled to grants-in-
aid from the Consolidated Fund of the state. Every five years a Finance
Commission, appointed by the governor of the state, is to review and advise
the state on principles governing distribution of funds to the panchayats; the
manner of auditing panchayat accounts also would be decided by state gov-
ernments. The state also would devolve to the panchayats the power to pre-
pare plans for economic development and social justice. Significantly, a new

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 HOSHIAR SINGH 825

Eleventh Schedule was drawn up to ensure better utilization of central and

state funds; it covers all agricultural and allied activities and rural programs
such as small industries including food processing and cottage industries, ru-
ral housing, drinking water, rural electrification, nonconventional energy
projects, poverty alleviation, primary and secondary education, vocational ed-
ucation, health and family welfare schemes, public distribution systems, and
welfare schemes for the weaker and handicapped sections.
Many of the provisions of the 73rd Amendment Act are good, such as the
insistence on regular elections for panchayats, making PR bodies financially
viable, and involving them in micro-level planning. The time limit set to
enforce the 73rd Amendment Act throughout the country is one year, which
seems to be sufficient. The Act also protects the autonomy of the states by
establishing its supervision and control over the areas noted above.
But there are some lacunae in the Act, especially in that it offers little to
the panchayats by way of functions, powers, and resources to shape them as
"units" of self-government. This has been left to each state legislature to
determine, and past experience has shown that the states are always reluctant
to part with power. The reservation provision for chairpersons of panchayats
could affect the smooth working of these bodies, and is likely to be misused
by the party in power at the state level to weaken the strongholds of opposi-
tion parties by reserving certain of these offices for ST, SC, and women.
This will ensure that even in the upper caste-dominated panchayats, the SC
and ST candidates would, by the rotation requirement, come to occupy the
chairperson posts, and similarly, women will also chair each panchayat by
rotation. This will create social tensions in India's caste-ridden, male domi-
nated society. It might be wise to let conventions secure shares in panchayat
leadership for the disadvantaged groups rather than relying on a legislative
stick. Further, the right of ex-officio members-MPs and MLAs-to vote in
these bodies could lead to overriding domination by legislators and this
would go against the intent of decentralization.
The 73rd Amendment dispenses with flexibility of structure for panchayati
raj. Questions such as a three-tier or two-tier system and the extent and
mode of reservations for women and the SC and ST are set in a uniform
pattern for the entire country. This inflexibility could cause great harm, for
example, in Kerala where, after protracted discussion for nearly two decades,
it was decided to have a two-tier system. Likewise, West Bengal, Karnataka,
and Andhra Pradesh adopted a two-tier PR system that has shown good re-
sults. But now every state with a population above two million is obliged to
have a three-tier system.10

10. E. M. S. Namboodiripad, "Panchayat Raj Bill: A Deceptive Measure," Tribune (Chandi-

garh), December 31, 1989.

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 826 ASIAN SURVEY, VOL. XXXIV, NO. 9, SEPTEMBER 1994

Not all the functions assigned to the PR institutions in the Eleventh Sched-
ule will be devolved to these bodies in practice by state governments. Teach-
ers' organizations oppose the transfer of primary and secondary education
management to PR bodies. Similarly, the distribution of electricity (includ-
ing rural electrification) and facilities for health and sanitation (including
hospitals, primary health centers, and dispensaries) are matters involving sub-
stantial technical know-how, which is seldom available at the village pan-
chayat level. Further, the one year period set for implementation of the Act
may be misused by states as a delaying tactic. If state governments hold their
PR elections within five years prior to enacting new legislation, the terms of
the newly elected panchayats will be allowed to run their course. Thus, im-
plementation of the Act could be delayed up to four years in those states.1"
Finally, although this was not the intention, it appears that in some cases
the Act will by implication undermine the powers of the states. For example,
it has placed panchayati raj on a Concurrent List and taken it out of the State
List of powers, which means that the central government can legislate in this
area. This amounts to an increase in the power of the center at the cost of the
states. Further, it was a unilateral decision of the center that one-third of
general membership seats be reserved for women in panchayats, as were the
decisions on chairperson offices and the direct method of election for village
and intermediate level panchayats. The creation of finance commissions to
provide funds to PR institutions in place of the states, and the flow of
Jawahar Rozgar Yojana funds directly from the center to panchayats also
undermine state powers.

Decentralization
The important questions are:
(1) To what extent does the 73rd Amendment Act support and encourage
decentralization of power or decentralization of decision-making at all
the levels in the country?
(2) To what extent is the Act capable of removing the weaknesses of the
present PR system; does it ensure healthy growth of PR in the country?
(3) Does the Act fulfill the requirement of Article 40 of the Constitution's
Directive Principles of State Policy? The government has mentioned Ar-
ticle 40 as a main basis for the 73rd Amendment.
The 73rd Amendment Act, providing for meaningful PR bodies, is doubt-
less a step toward decentralization of powers to people at the grass-roots. By

11. For example, West Bengal just held its panchayat elections under its old legislation.
Since the term of the Bengal panchayats was five years, new legislation would not be imple-
mented until the term expires. This device can be adopted by other states to delay implementa-
tion of the Act.

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 HOSHIAR SINGH 827

creating responsive village panchayats, a gram sabha, regular elections, and

sufficient representation of the weaker sections of society, it will provide op-
portunities for communities to participate in decision-making at the highest
levels of PR institutions. The one-third reservation for chairperson offices for
women and SC and ST does give a handle to the party in power in the state
for maneuverability and political use, but through powerful vested interests in
the villages, it will also limit the control of these forces. Nevertheless, the
Act is far short of what can be termed a desirable degree of decentralization
of powers. Under the Act, the PR institutions have not been given vital ad-
ministrative authority, for example, the power to transfer family pensions to
the widows of soldiers, most of whom live in villages. Such authority is in
the hands of the BDO, the treasury officer, or the gazetted officer, but should
have been devolved to PR bodies.
It was clear in Article 40 of the Constitution that self-government for
panchayats was the central objective, but in giving powers to PR bodies,
what exactly did state legislatures mean by "self-government?" With the
73rd Amendment, India is trying to create a meaningful and viable PR system
to serve the cause of local self-government institutions in the countryside.
The states now have no choice but to implement the constitutional provisions
or face the wrath of the Union government.
It is a fact that the PR system was not functioning in the right direction and
needed to be revitalized. The basic need was to evoke a comprehensive con-
cept of local government that would spell out clearly what is expected from
PR bodies. The theory that representative participation leads to mass partici-
pation is not relevant in the context of the Indian socioeconomic power struc-
ture. Therefore, it is necessary either to change this structure, which would
be difficult, or strengthen the position of the poor and weaker sections in rural
India so they can challenge their exploitation. The 73rd Amendment Act is
an attempt in that direction and could revitalize panchayati raj to achieve
decentralization and rural development.

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