Centre releases funds for local bodies: Kishan Reddy
Union Minister for Coal and Mines G Kishan Reddy announced that the Central Government has released substantial funds for the development of rural local bodies in Telangana under the 15th Finance Commission. The allocations, made on the recommendations of the Ministry of Panchayat Raj and the Ministry of Jal Shakti, are aimed at strengthening grassroots democracy and improving essential services in villages. Addressing the media on Thursday, the Minister said Telangana has already received Rs 1,034.42 crore in 2026, benefiting 12,702 Gram Panchayats. The first installment of Rs 259.36 crore was released on February 5, followed by a second installment of Rs 387.1 crore. Recently, the third installment of Rs 387.96 crore was disbursed after the completion of Gram Panchayat elections in the state.
The funds are categorised into untied grants and tied grants. Untied grants are meant for location-specific needs under the 29 subjects listed in the Eleventh Schedule of the Constitution, while tied grants are earmarked for sanitation, ODF (Open Defecation Free) status maintenance, solid and liquid waste management, drinking water supply, rainwater harvesting, and water recycling.
Over the past decade, the Centre has released more than Rs 11,000 crore to Telangana’s rural local bodies. Between 2015–16 and 2019–20, Rs 5,060 crore was allocated, while allocations between 2020–21 and 2025–26 rose by 80% to Rs 9,050 crore. Of this, Rs 6,051 crore was released before January 2026. The Finance Commission guidelines mandate that state governments transfer funds to Gram Panchayats within 10 working days of receiving them, without deductions. Any delay beyond this period requires states to pay interest equivalent to the rates charged on their market borrowings. Each Gram Panchayat must maintain a dedicated bank account, registered on the PFMS portal, to ensure transparency in fund utilisation.
Kishan Reddy criticised the previous BRS government for diverting Panchayat funds to other programmes, which led to hardships for village leaders, including resignations and, tragically, suicides in some cases. He urged the Telangana government to promptly transfer the remaining Rs 2,000 crore once utilisation certificates are submitted, thereby instilling confidence in newly elected Sarpanches and ward members.
The minister emphasised that the Modi government’s timely release of funds reflects its commitment to strengthening rural infrastructure and realising the vision of “Ram Rajya” through empowered village institutions.
