The Union Cabinet, chaired by Prime Minister Narendra Modi, on Wednesday approved the Pradhan Mantri Viksit Gram Swaraj Yojana (PM VGSY), a Centrally Sponsored Scheme aimed at strengthening grassroots governance and rural development across the country.
The scheme will be implemented from 2026–27 to 2030–31, in line with the Sixteenth Finance Commission period, with a total outlay of Rs 7,395.55 crore. This includes a Central share of Rs 4,869.48 crore and a State share of Rs 2,526.07 crore.
According to the government, the scheme will directly benefit around 32 lakh elected representatives, Panchayat functionaries and other stakeholders across more than 2.55 lakh Panchayats and Traditional Local Bodies. Each coordinated awareness-generation exercise is expected to reach at least one crore citizens.
The initiative aims to strengthen Gram Panchayats as centres of local governance by improving participatory planning, coordination among government departments, capacity building and transparent utilisation of resources.
Under the scheme, at least 2.55 lakh comprehensive Gram Panchayat Development Plans will be prepared annually through the eGramSwaraj Portal. These plans will bring together village-level priorities, government schemes and available resources to address local development needs.
The scheme will also promote public awareness of government programmes and national initiatives through existing digital and outreach platforms, Gram Sabhas and other Panchayat forums. The government will use PANCHAM, an AI-enabled multilingual communication platform available in 17 Indian languages, to explain schemes and initiatives in accessible language.
Capacity-building initiatives will strengthen the ability of elected representatives and Panchayat functionaries to prepare development plans, communicate with citizens, manage resources and work towards locally relevant Sustainable Development Goals.
The scheme also aims to improve financial accountability and transparency at the grassroots level. It will support the preparation of at least 2.55 lakh online audit plans annually and the timely completion of corresponding audits through AuditOnline. Improved accounting, public disclosure and mobilisation of Panchayats’ own-source revenue are expected to promote greater financial self-reliance.
PM VGSY will cover all States and Union Territories, including traditional rural local government institutions in areas where Panchayats do not exist under Part IX of the Constitution.
The scheme will be implemented through State Governments and Union Territory Administrations. States and UTs will submit annual action plans outlining activities, priorities and requirements, which will be appraised and approved by the designated Central Empowered Committee.
The government said the initiative would help Panchayats make better use of available financial resources, including Finance Commission grants, and align national development priorities with local needs and aspirations.
No permanent posts will be created under the scheme. However, need-based contractual personnel may be engaged at the State, district and block levels to provide technical support and facilitate implementation.
Published: Wednesday, 28 October 2026 | 6:45 PM IST