The Union Government has released Rs 512.27 crore as Fifteenth Finance Commission (XV-FC) grants to strengthen Rural Local Bodies (RLBs) in Gujarat during FY2025–26.

The release includes the first instalment of Untied Grants worth Rs 509.07 crore for FY2025–26, benefiting 14,561 Gram Panchayats, 247 Block Panchayats, and all 33 District Panchayats in the state. Additionally, Rs 3.20 crore—representing the withheld portion of the first and second instalments of Untied Grants for FY2024–25—has been released to 47 newly eligible Gram Panchayats and one Block Panchayat.

The Government of India, through the Ministry of Panchayati Raj and the Ministry of Jal Shakti (Department of Drinking Water and Sanitation), recommends the release of XV-FC grants to states, which are subsequently disbursed by the Ministry of Finance. These grants are released in two instalments each financial year.

The Untied Grants can be utilised by Panchayati Raj Institutions and Rural Local Bodies for location-specific developmental needs under the 29 subjects listed in the Eleventh Schedule of the Constitution, excluding salaries and establishment expenses. Meanwhile, Tied Grants are earmarked for basic services, including sanitation and maintenance of ODF status, management of household waste and fecal sludge, as well as drinking water supply, rainwater harvesting, and water recycling.