Union Budget 2016-17: Rural Sector

In order to equip PRIs to deliver on the Sustainable Development Goals, Rashtriya Gram Swaraj Abhiyan was proposed at an estimated cost of 655 crore rupees in 2016-17.

Created On: Mar 1, 2016 09:01 ISTModified On: Mar 1, 2016 11:26 IST

The Union Finance Minister Arun Jaitley on 29 February 2016 presented the Annual Financial Statement or the Union Budget for 2016-17 in the Lok Sabha. In his budget speech the minister listed nine pillars on which the Government will focus on in order to transform India into a developed nation.

The nine pillars are - Agriculture and farmers' welfare, rural sector, social sector including healthcare, education, skills and job creation, infrastructure, financial sector reforms, ease of doing business, fiscal discipline, tax reforms to reduce compliance burden.

Herein we present the new initiatives proposed and allocations made to energise rural India and transform lives of rural population.

New initiatives

Rashtriya Gram Swaraj Abhiyan

• It seeks to develop governance capabilities of Panchayat Raj Institutions (PRIs) to deliver on the Sustainable Development Goals.

• It will be implemented with 655 crore rupees in 2016-17.

Digital Literacy Mission Scheme

• A new Digital Literacy Mission Scheme will be launched to spread digital literacy in rural India.

• It is in addition to the existing National Digital Literacy Mission and Digital Saksharta Abhiyan (DISHA) and will cover 6 crore households by the end of 2018-19.

Revamped National Land Record Modernisation Programme

• It will build an integrated land information management system at an estimated cost of 150 crore rupees.

• It will be implemented as a Central Sector Scheme under the Digital India Programme with effect from 1 April 2016.

Total funds allocated

For rural development as a whole, 87765 crore rupees are allocated in the 2016-17 Budget.

Funds under the 14th Finance Commission

• A sum of 2.87 lakh crore rupees will be given as Grant in Aid to Gram Panchayats and Municipalities as per the recommendations of the 14th Finance Commission.

• This is a quantum jump of 228 percentage compared to the allocated made under the 13th Finance Commission period that is 2010-15.

• The funds allocated, translate to an average assistance of over 80 lakh per Gram Panchayat and over 21 crore per Urban Local Body.

Rural Development

Strengthening existing schemes

Deen Dayal Antyodaya Mission

• Every block in drought and distressed areas will be taken up as an intensive Block under this mission.

• It was launched in September 2014, seeks to alleviate urban and rural poverty through enhancement of livelihood opportunities through skill development and other means.

Mahatma Gandhi National Rural Employment Guarantee Scheme (MGNREGS)

Cluster Facilitation Teams (CFTs) will be set up under the scheme to ensure water conservation and natural resource management.

• Formation of Self Help Groups (SHGs) will be speeded up to promote multiple livelihoods.

• These districts would also be taken up on priority under Pradhan Mantri Krishi Sinchaii Yojna.

• A sum of 38500 crore rupees was allocated for this scheme in 2016-17. The allocation for this scheme in 2015-16 was 34699 crore rupees.

Shyama Prasad Mukherjee Rurban Mission

300 Rurban Clusters will be developed under this mission that was launched in February 2016 by the Prime Minister Narendra Modi from Chhattisgarh.

• These Clusters will incubate growth centres in rural areas by providing infrastructure amenities and market access for the farmers. They will also expand employment opportunities for the youth.


• 8500 crore rupees provided for Deendayal Upadhayaya Gram Jyoti Yojna and Integrated Power Development Schemes.

• At present around 13000 villages are not electrified and the goal is to achieve 100 percent village electrification by 1 May 2018.

Swachh Bharat Mission

• Priority allocation from Centrally Sponsored Schemes will be made to reward villages that have become free from open defecation.

• In order to continue the momentum under the mission 9000 crore rupees are allocated for 2016-17.

• Allocations for this mission in 2015-16 were 3625 crore rupees.

Pradhan Mantri Gram Sadak Yojana

• Taking into account the 8000 crore rupees of States, around 27000 crore rupees will be spent on this scheme in 2016-17. Funds allocated for this scheme in 2015-16 was 18291 crore rupees.

• The target for covering the remaining 65000 unconnected habitations was advanced from 2021 to 2019.

• Since its launch in 2000 by the erstwhile NDA Government, 230000km of roads have been constructed.

Monitoring: District Level Committees (DLCs) will be set up under Chairmanship of senior most Lok Sabha MP from the district for monitoring and implementation of designated Central Sector and Centrally Sponsored Schemes.

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