Empowering panchayats

Local bodies need more predictable revenue flows

A new study of the fiscal position of panchayati raj institutions (PRIs) by the Reserve Bank of India (RBI) should enrich the policy debate. Any comprehensive study of India’s public finance must include all three levels of government — the Union, states, and local bodies. The RBI also published a report on the state of municipal finances in November 2022. These reports on local-body finances fill an important gap in the general understanding of governance and underscore the need for more decentralisation of fiscal powers. PRIs play an essential role in developing and executing various programmes in rural areas. Since