The Jal Shakti Ministry has reported achievement in the utilisation of funds for water resource schemes. By the end of March 2025, 98.39 per cent of the Central allocation for these schemes had been spent. This marks a substantial improvement from previous financial years and showcases enhanced efficiency in fund management.
About Fund Allocation
The Central government allocates funds for water resource schemes under two main categories – Centrally Sponsored Schemes (CSS) and Central Sector schemes. CSS are primarily funded by the Centre but executed by state governments, often requiring a state contribution. In contrast, Central Sector schemes are fully funded and implemented by the Central government.
Expenditure Overview
For the fiscal year 2024-2025, the budget estimate for CSS was ₹13,431.48 crore. The actual expenditure amounted to ₹13,216.34 crore, demonstrating a high utilisation rate. Central Sector schemes had a lower utilisation rate of 81.79 per cent, with ₹5,376.73 crore spent out of ₹6,573.73 crore allocated.
Comparative Analysis with Previous Years
The current fiscal year saw a dramatic increase in fund utilisation compared to FY 2023-24, where only 49.45 per cent of CSS allocation was used. Total cumulative utilisation across all sources reached ₹15,804.73 crore for CSS and ₹5,376.73 crore for Central Sector schemes by March 2025.
Factors Contributing to Increased Utilisation
Officials attribute the improved fund usage to streamlined release mechanisms and enhanced coordination with state governments. Funds released to states and Consolidated Nodal Agencies (CNA) rose from ₹2,902.73 crore in FY 2024 to ₹4,756.48 crore in FY 2025.
Impact of Fund Deployment
The balances in State Nodal Agency accounts have also reduced, indicating faster on-ground deployment of funds. The SNA balance for CSS fell from ₹2,404.98 crore at the start of the year to ₹1,347.38 crore by March-end.
Challenges and Data Discrepancies
Despite the positive trends, minor discrepancies in data may still occur. These issues can arise from delays in sharing information by banks and state treasuries.
Future Implications
The increase in expenditure for Centrally Sponsored Schemes—from ₹10,059.15 crore in FY 2024 to ₹15,804.73 crore in FY 2025—indicates a ramp-up in project implementation. This trend is expected to support ongoing efforts in river development and Ganga rejuvenation.
Questions for UPSC:
- Critically discuss the role of state governments in the implementation of Centrally Sponsored Schemes.
- Examine the impact of improved fund utilisation on water resource management in India.
- Analyse how enhanced coordination between Centre and states can influence public expenditure.
- Point out the challenges faced in data reconciliation for government schemes and their implications.
Answer Hints:
1. Critically discuss the role of state governments in the implementation of Centrally Sponsored Schemes.
- State governments execute Centrally Sponsored Schemes (CSS) with a matching financial contribution, ensuring local relevance and adaptability.
- They are responsible for project planning, execution, and monitoring, which allows for tailored solutions to regional water issues.
- State governments play important role in mobilizing local resources and community involvement, enhancing project sustainability.
- Collaboration between state and central agencies is essential for effective fund disbursement and timely project completion.
- Challenges include bureaucratic delays, capacity constraints, and varying levels of commitment among states, impacting overall scheme effectiveness.
2. Examine the impact of improved fund utilisation on water resource management in India.
- Higher fund utilisation rates indicate enhanced efficiency in project execution, leading to better water resource management.
- Increased spending on water schemes can lead to improved infrastructure, such as irrigation systems and water supply networks.
- Effective utilisation supports initiatives for river development and Ganga rejuvenation, contributing to ecological restoration.
- Timely fund deployment reduces wastage and promotes accountability, encouraging trust in government initiatives.
- Improved fund management can lead to better outcomes in water conservation and sustainability efforts across states.
3. Analyse how enhanced coordination between Centre and states can influence public expenditure.
- Improved coordination facilitates faster release and deployment of funds, reducing delays in project implementation.
- Effective communication between levels of government ensures alignment of priorities and resource allocation, enhancing project relevance.
- Joint planning and execution can lead to shared best practices, improving overall efficiency and effectiveness of public spending.
- Enhanced coordination helps in addressing local challenges promptly, leading to better service delivery and public satisfaction.
- It can also promote transparency and accountability in the use of public funds, encouraging citizen trust in government actions.
4. Point out the challenges faced in data reconciliation for government schemes and their implications.
- Delays in data sharing between banks and state treasuries can lead to discrepancies in reported fund utilisation, affecting transparency.
- Inconsistent data across different agencies complicates monitoring and evaluation of scheme effectiveness and financial management.
- Data reconciliation challenges can hinder timely decision-making, impacting project adjustments and resource allocation.
- Errors in data reporting can undermine public trust in government schemes and lead to skepticism about fund usage.
- Addressing these challenges is crucial for improving governance and ensuring accountability in public expenditure management.
