NEW DELHI — The Union Cabinet, chaired by Prime Minister Narendra Modi, has approved the Pradhan Mantri Viksit Gram Swaraj Yojana (PM VGSY), a centrally sponsored scheme that the government describes as a next-generation governance transformation initiative for India's villages, the Press Information Bureau said in its official release.

Source: Press Information Bureau

The scheme will run from 2026-27 to 2030-31, co-terminus with the Sixteenth Finance Commission period, with a total outlay of Rs 7,395.55 crore — a central share of Rs 4,869.48 crore and a state share of Rs 2,526.07 crore. Briefing the media after the Cabinet meeting, Information and Broadcasting Minister Ashwini Vaishnaw called it a paradigm shift from prescription-based schemes to a model focused on local-level capacity building and planning, ANI reported via The Hindu BusinessLine.

Source: The Hindu BusinessLine (ANI)

Rs 7,395.55 croretotal outlay, 2026-27 to 2030-31
2.55 lakhPanchayats and traditional local bodies covered
32 lakhelected representatives, functionaries and stakeholders to be trained
Rs 4.35 lakh croreSixteenth Finance Commission grants recommended for rural local bodies in the same period

Around 32 lakh elected representatives, Panchayat functionaries and other stakeholders across more than 2.55 lakh Panchayats and traditional local bodies will be direct beneficiaries, the PIB release said. The scheme will extend to all states and Union Territories, including traditional local bodies in non-Part IX areas where Panchayats do not exist.

One plan, one platform for every village

At the centre of the scheme is a common digital platform, building on the eGramSwaraj portal and existing e-Panchayat systems, which will bring together information on government schemes, beneficiaries, benefits, community assets and available resources for each Gram Panchayat. The scheme will support the preparation of 2.55 lakh holistic Gram Panchayat Development Plans every year, so Panchayats and departments can identify gaps, align interventions and make better use of funds, including Finance Commission grants.

Accountability is the other pillar: the scheme will support at least 2.55 lakh online audit plans annually and timely completion of the corresponding audits through AuditOnline, alongside improved accounting, public disclosure and mobilisation of Panchayats' own-source revenue. Awareness exercises conducted through Gram Sabhas and platforms such as PANCHAM, an AI-enabled communication platform in 17 Indian languages, are each expected to reach at least 1 crore citizens.

No permanent posts will be created under the scheme, though need-based contractual staff may be engaged at state, district and block levels for technical support. States and UTs will submit Annual Action Plans, which a Central Empowered Committee will appraise and approve, the release said.