The Union Government has released ₹717.17 crore to Rural Local Bodies (RLBs) in Maharashtra as the first instalment of Untied Grants for the financial year 2025–26 under the 15th Finance Commission (XV FC).
The funds have been disbursed to all duly elected and eligible rural local bodies across the State, covering:
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2 Zilla Parishads (District Panchayats)
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15 Panchayat Samitis (Block Panchayats)
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26,544 Gram Panchayats
Grant Mechanism and Purpose
The Ministry of Panchayati Raj and the Ministry of Jal Shakti (Department of Drinking Water and Sanitation) recommend the release of XV-FC grants to States, following which the Ministry of Finance transfers the funds.
Each financial year, grants are released in two instalments and classified as:
1. Untied Grants
These funds can be used by rural local bodies for location-specific development priorities under the 29 subjects listed in the Eleventh Schedule of the Constitution, excluding payment of salaries and establishment expenses. This ensures that Panchayats can invest in locally relevant sectors such as rural roads, health, community assets, agriculture, and social welfare projects.
2. Tied Grants
Tied Grants have designated usage and support the delivery of essential services, specifically:
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Sanitation and ODF sustainability, including scientific management of household waste, human excreta, and faecal sludge
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Drinking water supply, including rainwater harvesting and water recycling systems
Strengthening Grassroots Governance
The release of the first instalment to Maharashtra’s rural local bodies is expected to bolster grassroots development initiatives, improve service delivery, and empower Panchayati Raj Institutions to address local infrastructure and social sector needs more effectively.