Union Minister of Panchayati Raj Rajiv Ranjan Singh alias Lalan Singh launched the Atmanirbhar Panchayat Programme, the SAMARTH Panchayat Portal, and the Model Own Source of Revenue (OSR) Rules at Krishi Bhawan in New Delhi. These three initiatives aim to strengthen the financial independence of Panchayati Raj Institutions across India by helping them generate their own revenues through local assets, digital tax collection, and a uniform policy framework. The launch aligns with the Sixteenth Finance Commission recommendations and the broader vision of Viksit Bharat @2047.
Panchayati Raj and the Push for Self-Reliance
Panchayati Raj Institutions are the foundation of grassroots democracy in India. The 73rd Constitutional Amendment Act, 1992, added Part IX (Articles 243 to 243O) and the Eleventh Schedule to the Constitution, giving constitutional status to Panchayats. The amendment mandated regular elections, reservation for Scheduled Castes, Scheduled Tribes, and women, and the establishment of State Finance Commissions to review the financial position of Panchayats.
Despite this constitutional backing, most Panchayats depend heavily on grants from the Central and State governments. Own Source Revenue, which includes property tax, user charges, licence fees, and other local levies, makes up a very small share of their total income. According to Comptroller and Auditor General reports over the years, the own revenue of Panchayats has remained below 10% of their total expenditure in many states. This weak financial base limits their ability to plan and execute local development projects independently.
What Is the Atmanirbhar Panchayat Programme?
The Atmanirbhar Panchayat Programme is a flagship initiative of the Ministry of Panchayati Raj that enables Gram Panchayats and Block Panchayats to identify local assets and opportunities and turn them into bankable, revenue-generating projects. The programme provides dedicated technical support from the Ministry to help Panchayats prepare project proposals, structure financing, and implement projects that build sustainable Own Source Revenue.
Key Features
The programme aims to develop 350 projects over four years: 50 projects in the first year and 100 projects in each of the following three years. Financing is mobilised through multiple channels including Public Private Partnerships, Corporate Social Responsibility contributions, convergence with existing Central and State schemes, and bank finance.
Two premier public sector financial institutions have been brought on board as institutional partners. The National Bank for Agriculture and Rural Development (NABARD), established in 1982 under the NABARD Act, and the Housing and Urban Development Corporation (HUDCO), established in 1970, will provide project appraisal expertise, technical handholding, and financing linkages to Panchayats under the programme.
Eligibility Criteria
Gram Panchayats with a minimum OSR of ₹50 lakh and Block Panchayats with a minimum OSR of ₹1 crore are eligible to apply. Each applicant must have at least three years of remaining tenure. Relaxed thresholds apply for special category States, which include the northeastern States, Himalayan States, and island territories.
SAMARTH Panchayat Portal: Digitising OSR Management
The SAMARTH Panchayat Portal is a first-of-its-kind digital platform developed by the Ministry of Panchayati Raj to streamline the management of Own Source Revenue at the Gram Panchayat level. Built as a unified, configurable national platform, SAMARTH enables Panchayats to handle the entire OSR lifecycle digitally from taxpayer registration and property mapping to demand generation, online payments, collection, and real-time revenue monitoring.
The portal supports UPI-based online tax assessment and payment, making it easier for rural residents to pay property tax, user charges, and other local fees digitally. For Panchayat officials, the dashboard provides a centralised view of revenue performance, registered properties, and pending collections.
Progress So Far
Two states Chhattisgarh and Himachal Pradesh have already been onboarded on the portal. As of the launch date, over 51 lakh taxpayers have been registered across these states, demand notices worth ₹95 crore have been generated, and more than ₹27 crore has been collected. Himachal Pradesh has made the SAMARTH portal mandatory for all its 3,616 Gram Panchayats for OSR management from 1 April 2026.
Onboarding is underway in Maharashtra, Mizoram, Assam, Haryana, West Bengal, and Uttar Pradesh, which together will significantly expand the portal’s coverage across the country.
Model OSR Rules: A Framework for States
To complement the digital and programmatic initiatives, the Ministry released Model Own Source of Revenue Rules for Panchayati Raj Institutions. These rules serve as a guiding framework that States and Union Territories can adopt or adapt according to their local requirements and existing legal structures.
The Model Rules aim to create a transparent, uniform, and efficient system for the assessment, collection, and management of Panchayat revenues. They cover all major OSR components including property tax, user charges, licence fees, advertisement fees, and other non-tax revenues.
Link to the Sixteenth Finance Commission
The Sixteenth Finance Commission, which submitted its report for the award period 2026 to 2031, recommended ₹4.35 lakh crore for Rural Local Bodies, representing an 84% increase over the previous commission’s allocation. A significant portion of these grants is tied to performance in OSR generation. The Commission specifically emphasised that strengthening Own Source Revenue is critical for the long-term financial sustainability of Panchayats. The Model OSR Rules directly respond to this recommendation by providing States with a ready-to-use legal and administrative template.
It is important to note that the Model Rules are advisory in nature. States have the flexibility to modify them to suit their local conditions, tax structures, and legal frameworks before notifying their own rules.
Key Takeaways
- The Atmanirbhar Panchayat Programme aims to develop 350 projects over four years with NABARD and HUDCO as institutional partners.
- The SAMARTH Panchayat Portal is a digital platform for end-to-end OSR management with over 51 lakh taxpayers already registered and ₹27 crore collected.
- The Model OSR Rules provide an advisory framework for States to strengthen Panchayat revenues, incorporating recommendations of the Sixteenth Finance Commission.
- The 73rd Constitutional Amendment Act, 1992 gave constitutional status to Panchayats through Part IX of the Constitution.
- The Sixteenth Finance Commission recommended ₹4.35 lakh crore for Rural Local Bodies for 2026-31, an 84% increase over the previous commission.
