Kerala Gets ₹260 Crore Boost for Village Local Bodies

December 15, 2025

New Delhi: The Centre on Monday released ₹260.20 crore to rural local bodies in Kerala under the 15th Finance Commission grants for the financial year 2025–26.

First Instalment of Untied Grants
According to an official statement, the amount represents the first instalment of untied grants and will benefit all 14 district panchayats, 152 block panchayats and 9,414 gram panchayats across the state. Untied grants allow local bodies to address area-specific needs under the 29 subjects listed in the Eleventh Schedule of the Constitution, excluding salaries and establishment expenses.

Difference Between Untied and Tied Grants
While untied grants offer flexibility in spending, tied grants are earmarked for essential services such as sanitation, maintenance of open defecation-free (ODF) status, waste management, and drinking water-related projects including rainwater harvesting and water recycling.

Similar Funds Released for Other States
Last week, the Centre released ₹717.17 crore to strengthen rural local bodies in Maharashtra. Earlier, over ₹223 crore was released for Assam and ₹444.38 crore for Odisha under the same Finance Commission framework. The grants are recommended by the Ministries of Panchayati Raj and Jal Shakti and released by the Ministry of Finance in two instalments each financial year.