Empowering Communities through Institutions, Investment, and Inclusion
Introduction
India’s vision of inclusive growth, guided by the principle of Sabka Saath, Sabka Vikas, Sabka Vishwas, Sabka Prayas, has led to noticeable improvements in recent years. These include a steady reduction in poverty, a gradual decrease in social and economic inequalities, and better access to essential services. Rural development has played a key role in this progress, as a large part of India’s population still lives in villages and depends on government support, local institutions, and community participation for social and economic development.
Over the years, increased public spending, better infrastructure, employment reforms, digital technology, and greater involvement of local governments and community institutions have transformed the approach to rural development in India. This shift reflects a broader understanding of inclusive development—one that focuses not only on economic growth but also on fairness, dignity, equal opportunities, and equal rights. Special attention is given to empowering vulnerable and marginalised communities so that no section of society is left behind in the process of development.
Union Budget allocations for Rural Development increased from ₹87,765 crore in 2016–17 to ₹2,73,108 crore in 2026–27, representing a rise of over 211 per cent during the decade. These figures indicate a sustained fiscal commitment to strengthening rural infrastructure, livelihoods, and local institutional capacity.
Policy Shift: From Welfare Delivery to Decentralised Partnerships
An important part of this transformation has been the gradual shift from a development model driven mainly by the government to one that gives greater importance to communities and local institutions. Local governments and grassroots organisations are now playing a bigger role in planning, implementing, and monitoring development programmes. This has allowed local people to express their needs and priorities, making the development process more participatory, relevant to local conditions, and sustainable.
The 73rd Constitutional Amendment Act, 1992, strengthened Panchayati Raj Institutions (PRIs) and gave constitutional recognition to grassroots democracy. It enabled rural communities to participate more directly in planning and implementing development activities. Building on this foundation, major programmes such as the Viksit Bharat-Guarantee for Rozgar and Ajeevika Mission (Gramin), formerly MGNREGS, Deendayal Antyodaya Yojana-National Rural Livelihoods Mission, Swachh Bharat Mission, and Jal Jeevan Mission have encouraged community participation by working closely with panchayats, self-help groups (SHGs), and other grassroots organisations.
This change reflects the idea of Jan Bhagidari, where people are no longer seen only as beneficiaries of government schemes but as active partners in the development process. Their participation is being strengthened through training and capacity building, the use of technology, stronger community institutions, and greater involvement in planning and budgeting.
Fiscal decentralisation has also strengthened the role of local governments. Direct financial transfers to panchayats have increased from around ₹2.36 lakh crore under the 15th Finance Commission (2021–2026) to nearly ₹4.35 lakh crore under the 16th Finance Commission (2026–2031). This increase in funding provides panchayats with greater financial independence and enables them to address local development needs more effectively.
Social Protection Expansion and Poverty Reduction Outcomes in India
India has made significant progress in expanding social protection and reducing poverty, supported by continuous public investment in the social sector. Access to social protection services—including improved drinking water, household electricity, and rural sanitation—increased considerably from 22 percent in 2016 to 64.3 percent in 2025. This shows a major expansion in the reach of basic social services and support systems.
This progress has been supported by a steady increase in Social Services Expenditure (SSE). Since FY22, government spending on social services has continued to rise. Between FY22 and FY26 (BE), SSE grew at a compound annual growth rate (CAGR) of 12 percent, while expenditure on education and health increased by 11 percent and 8 percent, respectively.
Assessing Poverty through Multidimensional Indicators
India has also seen a significant decline in multidimensional poverty. According to the Multidimensional Poverty Index (MPI) published by NITI Aayog, the Poverty Headcount Ratio declined from 55.3 percent in 2005–06 to 14.96 percent in 2019–21, and further to 11.28 percent in 2022–23.
Similarly, estimates based on the Tendulkar Committee methodology show a sharp decline in poverty between 2011–12 and 2023–24, with poverty levels falling in both rural and urban areas across different states.
Overall, these trends suggest that sustained economic growth, along with targeted welfare programmes and better access to essential services, has played an important role in reducing poverty in India. This progress reflects the combined efforts of the central and state governments, which have implemented various welfare schemes and introduced policies suited to local needs and challenges.
Enhancing Rural Living Standards through Basic Services
Public policy in India focuses on creating equal opportunities, reducing poverty, and preventing the gap between different sections of society from widening. Government programmes have worked towards improving access to affordable housing, food and social security, financial services, basic public facilities, and healthcare. These efforts have played an important role in improving the quality of life, especially in rural areas. The progress made in these areas is also reflected in the Ministry of Statistics and Programme Implementation (MoSPI)’s Sustainable Development Goal (SDG) National Indicator Framework Progress Report, 2025, which highlights improvements across several development indicators.
Accessibility to Safe Drinking Water
Access to safe drinking water in rural India has improved significantly, especially through the Jal Jeevan Mission (JJM), launched in 2019 with the vision of Har Ghar Jal. When the mission began, only 3.23 crore rural households (17 percent) had tap water connections. By November 2025, an additional 12.50 crore households had received tap water connections, taking the total coverage to around 15.74 crore households.
As a result, the percentage of rural households using improved sources of drinking water increased from 94.6 percent in 2015–16 to 99.6 percent in 2024–25. According to the Economic Survey 2025–26, independent studies have also found important social and health benefits. These include saving time for women, allowing them to participate more in economic activities, and reducing waterborne diseases. Improvements in sanitation and electricity access have further strengthened the quality of life in rural households.
Accessibility to Sanitation Facilities
The Swachh Bharat Mission (Grameen) was launched in 2014 with the aim of making India Open Defecation Free (ODF) by October 2019. By 2019–20, all districts in the country had been declared ODF.
The focus has now shifted towards maintaining cleanliness and improving waste management through ODF Plus villages. An ODF Plus village not only maintains its ODF status but also has proper arrangements for solid and liquid waste management and remains visually clean. As of December 31, 2025, more than 96 percent of villages under the mission had achieved ODF Plus status. By February 9, 2026, India had 5.68 lakh ODF Plus villages, with 5.29 lakh villages having proper solid waste management arrangements and 5.46 lakh villages having arrangements for liquid waste management.
So far, the mission has supported the construction of 2,331 plastic waste management units, 2.70 lakh community sanitary complexes, and 12.05 crore household toilets, contributing significantly to improved sanitation and cleanliness in rural India.
Ensuring Universal Household Electrification
The Pradhan Mantri Sahaj Bijli Har Ghar Yojana (SAUBHAGYA) was launched in 2017 to provide electricity connections to all willing households that did not have access to electricity, particularly in rural areas and among poor urban households.
At the time of its launch, around 3 crore households in the country were estimated to be without electricity. By FY 2021–22, 2.86 crore households had been electrified. By March 31, 2019, all States had reported 100 percent electrification of identified willing un-electrified households. This marked a major step towards ensuring universal access to electricity and improving living conditions across the country.
Expanding Access to Safe and Affordable Rural Housing
Safe and permanent housing is important for ensuring dignity, security, and better economic opportunities for low-income families. The Pradhan Mantri Awaas Yojana-Gramin (PMAY-G), implemented since April 2016, aims to provide Housing for All by 2029 by supporting eligible rural households in building pucca houses with basic facilities.
Against an overall target of 4.95 crore houses, around 4.14 crore houses have been allocated to States and Union Territories. Of these, 3.86 crore houses have been sanctioned, and 2.93 crore have been completed so far. In addition, 76.98 lakh houses pending under earlier housing schemes have also been completed. This has brought the total number of rural houses constructed over the past 11 years to 3.70 crore.
The government’s increasing focus on rural housing is also visible in the budget. Allocations for PMAY-G increased from ₹15,000 crore in 2016–17 to ₹54,916.70 crore in 2026–27.
Ensuring Last-Mile Connectivity through Rural Roads
Good road connectivity is essential for rural development because it helps people access schools, hospitals, markets, and employment opportunities. Better roads also contribute to poverty reduction by connecting remote villages with important services and economic centres.
The Pradhan Mantri Gram Sadak Yojana (PMGSY-I), launched in 2000, aimed to provide all-weather road connectivity to eligible unconnected rural habitations. By mid-January 2026, more than 99.6 percent of eligible habitations had been connected. Under this phase, 1,63,665 roads covering 6.25 lakh kilometres and 7,210 bridges had been completed.
The second phase, PMGSY-II, launched in 2013, focused on improving and upgrading existing rural roads. By mid-January 2026, 6,612 roads covering 49,087 kilometres and 749 bridges had been completed.
Similarly, PMGSY-III, approved in 2019, focuses on strengthening important rural routes that connect villages with agricultural markets, schools, and healthcare facilities. The scheme aims to improve 1.25 lakh kilometres of roads. So far, more than 1.02 lakh kilometres of roads and 1,734 bridges have been completed.
Reflecting the continued importance given to rural connectivity, the budget allocation for PMGSY increased from ₹12,581 crore in 2016–17 to ₹19,000 crore in 2026–27.
Improving Services and Inclusion for Tribal and Vulnerable Communities
Infrastructure development has also increasingly focused on tribal communities and other vulnerable groups. The PM-Janjati Adivasi Nyaya Maha Abhiyan (PM-JANMAN) aims to ensure that government schemes reach 28,700 habitations of Particularly Vulnerable Tribal Groups (PVTGs). Under the programme, 2,495 roads covering 7,324 kilometres and 164 bridges have been sanctioned. As of January 15, 2026, 263 roads had been completed.
Another important initiative, the Dharti Aaba–Janjatiya Gram Utkarsh Abhiyan (DA-JGUA), covers more than 63,000 tribal villages and focuses on improving access to essential services such as drinking water, housing, education, healthcare, and livelihood opportunities.
Environmental sustainability and livelihoods are also being promoted by strengthening the role of tribal and forest communities in managing natural resources. The establishment of 4,105 Van Dhan Vikas Kendras has benefited around 1.2 million people. At the same time, the implementation of the Forest Rights Act, 2006, has resulted in the distribution of more than 2.5 million forest titles, helping communities gain greater control over their land and forest resources.
Digitalisation and Technology-Led Service Delivery in Rural Areas
Digitalisation has become an important tool for making public services in rural India more accessible, efficient, and transparent. The use of technology along with administrative reforms has improved transparency, public participation, and accountability in the implementation of rural development programmes. It has also helped government services reach people living in remote and underserved areas.
The use of Aadhaar-linked systems has expanded rapidly, and Aadhaar-based payment systems are now widely used for direct and secure transfer of benefits. Electronic payment of wages has also become almost universal. Technology has further improved programme monitoring through the large-scale geo-tagging of assets, making it easier to track development works and ensure better implementation. An increasing number of these assets are also being created directly at the household level.
The SVAMITVA Scheme is another important example of the use of technology in rural development. It uses drone-based mapping to provide clear records of rural property ownership, helping reduce property disputes and improving access to credit and government services. As of December 2025, surveys had covered 3.28 lakh villages, and 2.76 crore property cards had been generated across 1.82 lakh villages.
Similarly, the Namo Drone Didi initiative promotes women’s participation in the digital economy by providing opportunities in drone-based agricultural and mapping services. During 2023–24, 1,094 drones were distributed to SHG Drone Didis, helping women gain new skills and livelihood opportunities.
Digitisation has also brought significant improvements in land governance through the Digital India Land Records Modernisation Programme (DILRMP). Under the programme, 99.8 percent of rural Records of Rights have been digitised, while 95.73 percent of Sub-Registration Offices have been computerised. In addition, Unique Land Parcel Identification Numbers (ULPIN/Bhu-Aadhaar) have been assigned to 36.67 crore land parcels. These initiatives have made land records more transparent, easier to access, and more efficient to manage.
Community-Led Institutions enabling Inclusive Governance and Livelihoods
India’s development experience highlights state capacity as a human system, in which community institutions, frontline workers, and local administrators are central to effective last-mile service delivery across health, education, skills, and livelihoods. Strengthening their capacities enhances local-level responsiveness, accountability, and the overall effectiveness of public service delivery.
Empowering Youth and Panchayats for Effective Local Governance
The Model Youth Gram Sabha (MYGS) promotes democratic engagement and civic awareness by familiarising students with grassroots governance through simulated Gram Sabha processes in schools. Implemented nationwide through institutions such as Jawahar Navodaya Vidyalayas and Eklavya Model Residential Schools, it builds leadership skills while reinforcing transparency, inclusivity, and accountability in local governance.
Complementing this, the Revamped Rashtriya Gram Swaraj Abhiyan (RGSA) strengthens decentralised governance by enhancing the institutional capacity of Panchayati Raj Institutions through leadership development, e-governance, and deeper constitutional devolution. Implemented during FY 2022–23 to 2025–26 with an outlay of ₹5,911 crore, RGSA aims to improve the efficiency and participatory quality of local governance. In the recent Union Budget 2026-27, ₹1,142 crore has been allocated for RGSA, reflecting continued emphasis on strengthening grassroots institutions.
Women-Led Institutions as Drivers of Rural Transformation
Women-led institutions are central to the Deendayal Antyodaya Yojana–National Rural Livelihoods Mission (DAY-NRLM), positioning women as key drivers of rural transformation. The programme has been allocated ₹19,200 crore in the Union Budget 2026-27. Through Self-Help Groups (SHGs) and their federations, the programme provides the rural households with a collective platform for savings, access to credit, and community support. To date, 10.05 crore women have been mobilised into 90.09 lakh SHGs, expanding financial inclusion and collective economic action.
India’s development experience shows that effective governance is not only about government policies and institutions but also about the people who implement them at the grassroots level. Community institutions, frontline workers, and local administrators play a crucial role in ensuring that public services reach people at the last mile, especially in areas such as health, education, skill development, and livelihoods. Strengthening their skills and capacities helps make local governance more responsive, accountable, and effective.
Empowering Youth and Panchayats for Better Local Governance
The Model Youth Gram Sabha (MYGS) encourages students to understand democracy and local governance by involving them in simulated Gram Sabha activities in schools. Implemented across the country through institutions such as Jawahar Navodaya Vidyalayas and Eklavya Model Residential Schools, the programme helps young people develop leadership skills and civic awareness. It also promotes important values such as transparency, inclusion, participation, and accountability in local governance.
Similarly, the Revamped Rashtriya Gram Swaraj Abhiyan (RGSA) focuses on strengthening Panchayati Raj Institutions and improving decentralised governance. It supports leadership development, e-governance, and greater devolution of powers to local bodies. Implemented from FY 2022–23 to 2025–26 with an outlay of ₹5,911 crore, the programme aims to make local governments more efficient and participatory. In the Union Budget 2026–27, ₹1,142 crore has been allocated to RGSA, showing the continued focus on strengthening grassroots institutions.
Women-Led Institutions Driving Rural Transformation
Women-led institutions have become an important force in rural development through the Deendayal Antyodaya Yojana–National Rural Livelihoods Mission (DAY-NRLM). The programme, which received an allocation of ₹19,200 crore in the Union Budget 2026–27, places rural women at the centre of economic and social transformation.
Through Self-Help Groups (SHGs) and their federations, women receive a collective platform for saving money, accessing credit, supporting each other, and improving their livelihoods. So far, around 10.05 crore women have been mobilised into 90.09 lakh SHGs, promoting financial inclusion and collective economic participation.
The programme goes beyond financial support. It helps women farmers adopt sustainable agricultural practices, supports livestock-based livelihoods, promotes small non-farm businesses, and creates livelihood opportunities for landless women based on locally available resources.
Guided by the principles of Panchsutra and further strengthened through the Dashsutra framework, SHGs are increasingly contributing to wider community development. Their role now extends to areas such as health and nutrition, education, local governance, access to government benefits, and sustainable livelihoods. This has made SHGs important institutions for community-led rural development and social transformation.
Women-Led Community Resource Persons for Livelihoods and Services
Community Resource Persons (CRPs), including Bank Sakhis, Krishi Sakhis, Pashu Sakhis, and Enterprise Promotion CRPs, play an important role in supporting women-led community institutions at the grassroots level. These trained women help other community members access financial services, improve agricultural practices, strengthen livelihoods, and connect with government schemes.
Currently, around 1.49 lakh Bank Sakhis provide financial services, while more than 9 lakh CRPs support communities in areas such as agriculture, banking, insurance, nutrition, and other related activities. Over a period of six to eight years, SHG households are expected to achieve better food security and stable incomes, leading to more sustainable livelihoods.
Building on this network, the National Campaign on Entrepreneurship aims to train 50,000 CRPs and provide enterprise development support to 50 lakh SHG members under the vision of “Har Ghar Udyam, Har Gaon Samriddh.”
Women-led BC Sakhis, supported by digital tools and Point of Sale (PoS) devices in collaboration with India Post, have also helped expand access to banking and social security services in rural areas. At the community level, the coordination of DAY-NRLM CRPs with Anganwadi Workers, ANMs, and ASHAs has strengthened community awareness and behaviour change initiatives. This collaboration has contributed to better maternal and child health practices and increased use of healthcare services.
Samaveshi Aajeevika Yojana: Supporting the Ultra-Poor
The Samaveshi Aajeevika Yojana, launched in April 2023 under DAY-NRLM, follows the Ultra-Poor Graduation Approach to help the poorest rural women move towards sustainable and stable livelihoods. The programme provides support in several areas, including livelihood opportunities, social protection, social empowerment, and financial inclusion.
The approach is based on providing comprehensive support rather than only financial assistance. It includes help such as asset transfers, regular guidance and coaching, skill development, and time-bound livelihood support. Successful state-level initiatives, such as Bihar’s Satat Jeevikoparjan Yojana (SJY), have demonstrated the effectiveness of this model. The programme also connects beneficiaries with social security schemes and uses data-based monitoring systems managed at the community level to track their progress and ensure effective implementation.
Community-Led Approaches to Food, Nutrition, Health, and WASH (FNHW)
India has made significant progress in improving health and nutrition outcomes, supported by national programmes as well as strong community-based delivery systems. According to the Economic Survey 2025–26, India has performed better than global averages in several key health indicators since 1990. Maternal mortality has declined by 86 percent, under-five mortality by 78 percent, and neonatal mortality by 70 percent. Similarly, the infant mortality rate declined from 40 per thousand live births in 2013 to 25 in 2023, showing steady improvement in maternal and child health.
To further improve health and nutrition at the grassroots level, DAY-NRLM has introduced Food, Nutrition, Health, and WASH (FNHW) interventions. These initiatives aim to address challenges such as malnutrition, poor sanitation, and lack of health awareness. The programmes are implemented according to the needs of different states and place strong emphasis on Social and Behaviour Change Communication (SBCC).
The interventions focus on important areas such as maternal and child health, a balanced and diverse diet, reducing anaemia, menstrual hygiene, disease prevention, sanitation, and waste management. They also promote nutrition-based livelihood activities, including nutri-gardens, backyard poultry, rearing small animals, and dairy farming.
By 2025, FNHW interventions had been introduced in 6,406 blocks across 683 districts. These efforts have strengthened community participation, increased awareness about panchayat-level activities and government schemes, and encouraged positive behavioural changes. Overall, the programme is helping communities become more actively involved in improving their health, nutrition, sanitation, and local development.
Skill Development, Entrepreneurship, and Employment in Rural Areas
India’s rural labour market has a unique employment structure, with a large number of people depending on agriculture and self-employment for their livelihoods. According to the Periodic Labour Force Survey (PLFS) for October–December 2025, 58.5 percent of rural workers are engaged in agriculture, while 63.2 percent are self-employed. Women have a relatively higher participation in both these categories. This highlights the need to create better livelihood opportunities, develop relevant skills, and promote entrepreneurship that matches the needs of rural communities.
Skilling Pathways for Inclusive Rural Growth
Skill development plays an important role in helping rural people access better jobs and diversify their sources of income. The Deen Dayal Upadhyaya Grameen Kaushalya Yojana (DDU-GKY) focuses on providing demand-based skill training to rural youth and linking them with employment opportunities. The quality and relevance of training are maintained through mandatory third-party certification by National Skill Development Corporation (NSDC) Sector Skill Councils.
The programme mainly targets poor rural youth between 15 and 35 years of age. However, the upper age limit is extended to 45 years for women and other vulnerable groups, including persons with disabilities, Particularly Vulnerable Tribal Groups (PVTGs), and transgender persons.
DDU-GKY is implemented across 27 States and 4 Union Territories through 2,369 training centres, covering 37 sectors and 816 job roles. As of October 2025, 82,272 candidates had received training and 37,035 had been placed in jobs during the year. Since the launch of the programme, a total of 17.92 lakh rural youth have been trained, and 11.64 lakh have been placed in wage employment.
Along with DDU-GKY, Rural Self Employment Training Institutes (RSETIs) also play an important role in improving employment opportunities in rural areas. Operating under a public-private partnership model, RSETIs provide locally relevant skill training and entrepreneurship development. They currently function through 629 institutes across 616 districts in 33 States and Union Territories.
Since their inception, RSETIs have trained nearly 59 lakh rural youth, of whom around 43 lakh have found employment or started their own businesses. This shows their important contribution to improving rural employment and encouraging entrepreneurship.
Entrepreneurship Pathways for Women in Rural India
Promoting women’s entrepreneurship is important for increasing rural incomes and improving women’s participation in the workforce. Providing women with skills and opportunities in growing sectors such as manufacturing, renewable energy, digital services, and agro-processing can open up new sources of employment and income.
Initiatives such as ‘Back to Work’ and ‘Returnship Programmes’ can also help women who have taken career breaks re-enter the workforce. At the same time, connecting Self-Help Groups (SHGs) with the MSME ecosystem can help women move beyond small subsistence activities and develop more formal and growth-oriented businesses. These efforts can strengthen women’s economic independence and create more inclusive growth in rural India.
SHE-Marts for Rural Women-led Enterprises
Building on the success of the Lakhpati Didi Programme, the Union Budget 2026–27 has proposed the establishment of Self-Help Entrepreneur (SHE) Marts. These will function as community-owned retail outlets managed through Cluster-Level Federations. With better and innovative financing support, the initiative aims to help rural women move beyond small credit-based activities and become owners of sustainable businesses.
Advancing Employment Opportunities in Rural India
The Viksit Bharat Guarantee for Rozgar and Ajeevika Mission (Gramin) Act, 2025, marks an important reform in India’s rural employment policy. With a budget allocation of ₹95,692.31 crore for 2026–27, the Act seeks to modernise the rural employment guarantee system by improving accountability and linking employment opportunities with infrastructure development and climate resilience. It represents an important step forward from the earlier MGNREGA framework.
Some of its key provisions include:
- It provides a legal guarantee of 125 days of unskilled wage employment per year to every eligible rural household.
- It focuses on four major areas: water security, rural infrastructure, livelihoods, and disaster preparedness.
- It strengthens workers’ rights by providing safeguards such as compensation for delays in employment, removal of disentitlement clauses, and stronger accountability mechanisms.
Overall, the Act aims to make rural employment programmes more responsive to present-day development needs while also creating durable assets and strengthening the resilience of rural communities.
Conclusion
India’s rural development journey over the past decade shows a clear shift from isolated welfare schemes to a more integrated, decentralised, and community-driven approach to development. Continuous public investment and increased budget allocations have improved access to housing, rural roads, drinking water, sanitation, digital services, and social protection. At the same time, greater attention has been given to improving livelihoods, skill development, and entrepreneurship in rural areas.
A key part of this transformation has been the strengthening of local institutions such as Panchayati Raj Institutions (PRIs), Self-Help Groups (SHGs), and community workers. These institutions have helped change rural governance by moving people away from being seen only as beneficiaries of government schemes to becoming active participants and partners in the development process. This reflects the principle of Jan Bhagidari, which emphasises people’s participation in planning and development.
The use of technology, women-led institutions, and targeted livelihood programmes has further improved transparency, inclusion, and resilience, especially among vulnerable and marginalised communities. Overall, these reforms show that rural India is no longer simply a recipient of development programmes. Instead, rural communities are increasingly becoming active drivers of inclusive growth, democratic governance, and long-term social and economic development.
