The Union Government has released the first instalment of XV Finance Commission Untied Grants for Rural Local Bodies in Sikkim for financial year 2025–26, amounting to ₹643.50 lakhs. These funds are for eligible 5 District Panchayats (DPs) and all 199 eligible Gram Panchayats (GPs) of the State. Further, Rs.17.50 lakhs of withheld portion of 2^nd instalment of Untied Grants for FY 2024–25 has also been released to additionally eligible 1 District Panchayat.

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 Panchayati Raj Institutions (PRIs) / Rural Local Bodies (RLBs) 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 Panchayati Raj Institutions (PRIs) / Rural Local Bodies (RLBs) 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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