Learn how the World Bank Group is helping countries with COVID-19 (coronavirus). Find Out


$84 Million for Bihar Panchayat Strengthening Project, India

September 27, 2012

The Project will strengthen Panchayati Raj Institutions across 1,300 gram panchayats in six districts of Bihar

WASHINGTON, DC, September 27, 2012- The World Bank today approved $84 million credit for the Bihar Panchayat Strengthening Project to support the government of Bihar’s efforts at creating better local governance at the village level.

The Project will support the state government’s gradual decentralization agenda and improve capacities of gram panchayats (village councils) to plan and implement development schemes. It will build panchayats’ administrative, planning and financial management capacity; mobilize communities to increase people’s knowledge of their rights and responsibilities in relation to Panchayati Raj Institutions (PRIs); raise awareness among local leaders and communities on the need for local action that can improve health and livelihood; and also facilitate their access to government program resources to finance the community’s priorities.

The government of Bihar has institutionalized the strategy of political inclusion for women, scheduled castes (SC), scheduled tribes (ST) and extremely backward castes at the panchayat level. Because of these provisions, the elections in 2006 and 2011 ensured a much larger role for marginalized sections of the population in local governance – today 55 per cent of the elected panchayat members in Bihar are women, 14 per cent belong to scheduled castes, and 0.66 per cent to scheduled tribes. This reservation policy has created an unprecedented opportunity for poor people to express their views.

The Bihar Panchayat Strengthening Project, approved today, will focus on bringing about visible changes in the Project villages of Bihar, particularly in the areas of village sanitation, quality of drinking water, nutrition and management of natural resources. This will be done primarily through helping gram

panchayats access and effectively use the funding provided by a few large government schemes like the Mahatma Gandhi National Rural Employment Guarantee Act scheme (MGNREGS), Total Sanitation Campaign (TSC), National Rural Drinking Water Program (NRDWP), Integrated Child Development Services (ICDS) and discretionary grants from the 13th Finance Commission and the Backward Region Grant Fund. The Project will cover six districts across 1,300 gram panchayats.

“A strong network of Panchayati Raj Institutions, once empowered with the ability to identify and address its own development priorities, can make a rich contribution to both local and government  development programs,” said Mr Onno Rûhl, World Bank Country Director for India. “We hope this Project will go a long way in supporting the government of Bihar’s long-term vision of inclusive, responsive and accountable local governance,” he added

A wide range of administrative reforms in the recent past have brought about a more citizen centric governance, better public financial management and improvement in development indicators in Bihar. However, low levels of education, limited human resources, lack of basic infrastructure and social inequalities limits the degree of participation of all social groups in panchayat activities in the state.

“The Project will help create the necessary infrastructure, strengthen institutions at the gram panchayat level  and invest in mobilizing communities to raise awareness and build capacity of citizens  to participate in local governance, ,” said Mohan Nagarajan, Project Task Team Leader and Senior Economist at the World Bank. “At the state level, the Project will also strengthen the state government’s capacity to manage a gradual decentralization and empowerment process,” he added.

Other components:

Consequently, the focus will be on creating capacity of the PRIs to use existing government resources better. At the panchayat level, it will work with standing committees provided for under the Bihar Panchayat Raj Act 2006 and, in particular, with the standing committees on water, sanitation and health, as well as the production committee.  The Project will invest in facilitators who can then help gram panchayats plan and implement initiatives to tackle local development challenges.  

As a part of this initiative, community-led Total Sanitation Campaign will be introduced in four of six districts in a phased manner. Block facilitators will be trained to work with panchayat leaders to enhance their commitment to improve the quality of water in their villages. A module on sustainability of water sources and improving quality will be introduced in the same districts.

In collaboration with the standing committee on production, natural resource management will be introduced in four districts in phases. Emphasis will be on spreading tested ideas and directing wage employment under MGNREGS to creating productive assets and sustainable livelihood for villagers.

Similarly, in close coordination with the ICDS functionaries, efforts at improving nutrition will be piloted in four districts in a phased manner. Through gram panchayat leaders, communities will be mobilized to promote positive behavior at the community level in improving quality nutrition services.

The Project will also strengthen the public financial management systems at the panchayat level and introduce computerized panchayat accounting system – PRIASOFT – in all Project districts beginning with Patna and Nalanda.

The Project will be financed by a credit from the International Development Association (IDA) – the World Bank’s concessionary lending arm – which provides interest-free loans with 25-year maturity and a grace period of five years.


Media Contacts
In India
Nandita Roy
Tel : 91-11-41479220
In Washington
Gabriela Aguilar
Tel : (202) 473-6768