Eleventh Schedule

Topic: Panchayati Raj: Rural Local Government · NCERT: Class 11, Ch 8 "Local Governments"

Meaning

The Eleventh Schedule is a list of 29 subjects that the 73rd Amendment Act, 1992 added to the Constitution. A state may hand these subjects over to panchayats by passing its own law under Art. 243G.

• It shows what work village bodies can do. Examples are agriculture, minor irrigation, drinking water, primary and secondary schools, health and the public distribution system (PDS).
• On its own, the list gives panchayats no power. How much power panchayats get depends on how much each state is willing to give.

Explanation

How it works

• The Schedule is linked to Art. 243G.
• Art. 243G says the state legislature "may" pass a law giving panchayats powers. With these powers, panchayats can work as institutions of self-government (bodies that run their own local affairs, not just carry out orders).
• That state law may ask panchayats to:
• prepare plans for economic development and social justice;

• carry out schemes, including schemes on the 29 Eleventh Schedule subjects.

• Devolution of powers means the state hands over three things, called the "3 Fs":

• functions (the work);
• funds (the money);

• functionaries (the staff).

• Activity mapping means breaking each subject into small tasks and giving each task to one tier. The three tiers are the gram panchayat (village), the panchayat samiti (block) and the zila parishad (district).

• Example (drinking water): the gram panchayat repairs hand pumps, the block runs schemes that serve several villages, and the district plans new water sources.
• Everyone then knows who does what, so work does not overlap.
• The Ministry of Panchayati Raj (MoPR) and the Second Administrative Reforms Commission (2nd ARC) have pushed states to do activity mapping.

The 29 subjects, grouped for memory

Group	Subjects (entry numbers)
Farm and land	(1) agriculture and agricultural extension; (2) land improvement, land reforms, land consolidation, soil conservation; (3) minor irrigation, water management, watershed development; (4) animal husbandry, dairying, poultry; (5) fisheries; (6) social forestry and farm forestry; (7) minor forest produce
Rural industry	(8) small-scale industries, including food processing; (9) khadi, village and cottage industries
Basic services	(10) rural housing; (11) drinking water; (12) fuel and fodder; (13) roads, culverts, bridges, ferries, waterways; (14) rural electrification, including distribution of electricity; (15) non-conventional energy sources
Anti-poverty	(16) poverty alleviation programmes
Education and culture	(17) education, including primary and secondary schools; (18) technical training and vocational education; (19) adult and non-formal education; (20) libraries; (21) cultural activities
Economy and health	(22) markets and fairs; (23) health and sanitation, including hospitals, PHCs and dispensaries; (24) family welfare
Social justice	(25) women and child development; (26) social welfare, including welfare of persons with disabilities; (27) welfare of weaker sections, especially SCs and STs
Supply and assets	(28) public distribution system (PDS); (29) maintenance of community assets

• Exam trap: the list covers "primary and secondary" education only. It does not cover higher education.
• Exam trap: it says "minor" irrigation and "minor" forest produce. It does not cover major irrigation or major forest produce.

Limits: why the list is optional

• The word "may" makes devolution a choice for each state.
• Each state decides how much to hand over.

• So states differ widely. Kerala and Karnataka gave a lot. Many other states gave little.

• Class 11 NCERT notes that "many States have not transferred most of the subjects."

• A state can give away only its own powers.
• That is why states transfer only State List subjects (subjects on which the state makes laws, under the Seventh Schedule).

• Union List subjects do not belong to the state, so it cannot hand them over. An NCERT cartoon raises this point.

• Functions without funds are empty.

• Panchayats can do Eleventh Schedule work only if they get money.
• Under Art. 243H, a state "may" let panchayats levy taxes, fees and tolls, give them a share of state taxes, and pay them grants-in-aid (money given by a higher government) from the state's Consolidated Fund.
• Under Art. 243I, the Governor "shall" set up a State Finance Commission (SFC) to recommend how state money is shared with panchayats. This step is mandatory.

In the Constitution and practice

• Source: the Schedule was added by the 73rd Amendment Act, 1992, which came into force on 24 April 1993. It is tied to Art. 243G in Part IX of the Constitution (Panchayats).
• Twin list: the 74th Amendment added the Twelfth Schedule, a separate list of 18 subjects for municipalities.
• Money articles that support the Schedule:
• Art. 243H: panchayat taxes and grants (optional);
• Art. 243I: State Finance Commission (mandatory). The first SFC was due within one year of 24 April 1993, and a new one is due at the end of every fifth year;
• Art. 243J: keeping and auditing panchayat accounts (optional);

• Art. 280(3)(bb): the Union Finance Commission must recommend ways to add to a state's Consolidated Fund so the state can support its panchayats. This clause was added by the 73rd Amendment.

• In practice, panchayats depend heavily on grants:

• An RBI study, "Finances of Panchayati Raj Institutions" (January 2024), covered about 2.58 lakh panchayats from 2020-21 to 2022-23 [2].
• Own revenue was only 1.1% of panchayats' total revenue [2].

• Grants-in-aid from the Centre and states made up over 95% of receipts [2].

• Weak State Finance Commissions:

• The Standing Committee on Rural Development and Panchayati Raj (report of 29 July 2025) found that only 25 of 28 states had set up SFCs [3].

• This was so even though, from 2024-25, setting up an SFC is a condition for getting central grants [3].

• Finance Commission grants that fund Eleventh Schedule work:

• 15th FC (2021-26): ₹2.36 lakh crore for rural local bodies, split 60% tied and 40% untied [3]. A tied grant can be spent only on set purposes; an untied grant can be spent on local needs.
• The 15th FC's tied grants were only for sanitation and drinking water. The tied grant for water and sanitation was ₹1.42 lakh crore [5]. Both are Eleventh Schedule subjects (entries 11 and 23).
• 16th FC (2026-31): ₹4,35,236 crore for rural local bodies, split 80% basic and 20% performance [4]. A performance grant is paid only when a body meets set conditions.
• The 16th FC splits the basic grant 50% untied and 50% tied to sanitation and solid waste management and/or water management [4].
• "Timely constitution of the State Finance Commission" is one of the 16th FC's three entry-level conditions for local body grants [4].

Don't confuse with

• Twelfth Schedule: it lists 18 subjects for municipalities and came from the 74th Amendment. The Eleventh Schedule lists 29 subjects for panchayats and came from the 73rd Amendment.
• State List (Seventh Schedule): this list gives the state legislature the power to make laws. The Eleventh Schedule gives panchayats no law-making power. It only lists work that a state "may" hand over by law.
• Art. 243G vs Art. 243H: 243G covers functions and powers, and it is the article linked to the Eleventh Schedule. 243H covers money: taxes, fees and grants-in-aid.
• State Finance Commission vs Union Finance Commission: the SFC is set up by the Governor under Art. 243I and divides state money with panchayats. The Union FC acts under Art. 280(3)(bb) and recommends ways to add to the state's funds, based on the SFC's advice.

Prelims Hooks

• Eleventh Schedule: 29 subjects, added by the 73rd Amendment, 1992, linked to Art. 243G. The Twelfth Schedule has 18 subjects for municipalities.
• "Which of the following is in the Eleventh Schedule?" Primary and secondary education, minor irrigation, minor forest produce, PDS, non-conventional energy and libraries are in the list. Higher education and major irrigation are not.
• Art. 243G uses "may", so transferring Eleventh Schedule subjects is optional for states, not compulsory.
• Art. 243I (SFC) is mandatory ("shall"). Arts. 243G, 243H and 243J are optional ("may"). The Governor, not the President, sets up the SFC.
• RBI study (2024): own revenue was 1.1% of panchayat revenue, and grants were over 95% [2].
• 16th FC (2026-31): ₹4,35,236 crore for rural local bodies, split 80:20 basic:performance, with the basic grant split 50:50 tied:untied [4]. 15th FC: ₹2.36 lakh crore, 60:40 tied:untied [3].

Mains Points

• Panchayats get duties without power.
• The word "may" in Arts. 243G and 243H lets each state decide how much to devolve.
• Most states transfer subjects on paper but keep the funds and staff. Panchayats are left carrying out state and central schemes.

• Reform: make activity mapping compulsory, link it to state budgets, and use a devolution index to rank states.

• Panchayats depend on grants.

• Own revenue is about 1% of receipts, and grants are over 95% [2]. So panchayats answer upward to the Union and the states, not to their own voters.

• Reform: give panchayats stronger property tax powers, value property using GIS maps, and reward higher own revenue through performance grants. The 2025 Standing Committee also called for financial and technical help to raise own revenue [3].

• Tied or untied grants: a trade-off.

• Tied grants protect national goals in Eleventh Schedule areas, such as open defecation free (ODF) villages and safe water. Untied grants respect local choice.
• The 16th FC's 50:50 split of the basic grant is a middle path [4]. Making a timely SFC an entry condition gives the Centre a lever to push states [4].
• Bolivia's Popular Participation Law (1994) automatically shares 20% of national tax collections per head among 314 municipalities. It shows a more predictable, formula-based model than India's system, which depends on state choice.

Related concepts

• Devolution of powers to panchayats
• Activity mapping
• State Finance Commission
• Own source revenue of local bodies
• Tied and untied grants to local bodies

Read more

• Functions and finances: Eleventh Schedule, SFCs and own revenue