The Union Government has released ₹127.586 crores to Rural Local Bodies and Panchayati Raj Institutions in Tamil Nadu during the financial year 2025-26. The amount represents the second instalment of untied grants under the XV Finance Commission for 2025-26. These grants have been released for 9 District Panchayats, 74 Block Panchayats and 2,901 Gram Panchayats that have duly elected bodies and fulfil the prescribed eligibility conditions.

Government of India through Ministry of Panchayati Raj and Ministry of Jal Shakti (Department of Drinking Water and Sanitation) recommends release of XV-FC grants to States for Rural Local Bodies / Panchayati Raj Institutions, which are then released by Ministry of Finance. The allocated grants are recommended and released in 2 installments in a financial year. The Untied Grants will be utilized by RLBs/ PRIs for location-specific felt needs, under the Twenty-Nine subjects enshrined in the Eleventh Schedule of the Constitution, except for salaries and other establishment costs. The Tied Grants can be used for the basic services of (a) sanitation and maintenance of ODF status, and this should include management and treatment of household waste, and human excreta and fecal sludge management in particular and (b) supply of drinking water, rainwater harvesting and water recycling.

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