Pradhan Mantri Gram Sadak Yojana

Updated on: May 31st, 2021 - 2:08:10 PM

7 min read

social iconssocial iconssocial iconssocial icons

For a country with the third-largest road network in the world and the changes in climate, India requires roads that are pretty durable and have the ability to withstand all the weather conditions. The rural areas, especially the interiors, often suffered the plight of poorly constructed roads that caused a hindrance to efficient transportation and vehicular movement. 

With an aim to boost economic activity and grant the rural inhabitants access to better facilities, the Pradhan Mantri Gram Sadak Yojana (PMGSY) was introduced in December 2000. The idea was to provide rural India with unrestricted all-weather road connectivity, thus facilitating easy movement of goods and services all over India, which in turn leads to a boost in economic activity and the overall development of India as a country. It was initially introduced as a 100% centrally sponsored scheme. 

The PMGSY comes under the purview of the Ministry for Rural Development. The rural roads constructed under the PMGSY shall be as per the requirements of the Indian Roads Congress (IRC). The Indian Roads Congress was established in 1934 and is the apex body of highway engineers in the country.

Objectives of Pradhan Mantri Gram Sadak Yojana (PMGSY)

The Pradhan Mantri Gram Sadak Yojana was launched with the objective of providing the rural areas with the betterment of socio-economic conditions through the formation of durable, all-weather condition road connectivity, especially to the areas of unconnected habitation and the other core areas as well. 

Significance of PMGSY

Ease of Access and Ease of Movement

A certain percentage of India is considerably out of touch with reality and development owing to a lack of mobility and access to those areas. Lack of roads or any form of access has been a major reason for those areas to be lagging behind drastically in terms of development and advancement.

Rural road connectivity is a highly essential requisite for rural development. This, in turn, provides access to better socio-economic conditions, enhances the agricultural income as well in order to provide a better standard of living to rural India.

Overall Development

The PMGSY aims to eliminate the lack of accessibility and connectivity through the construction of solid, all-weather resistant roads that allow for easy movement of vehicles and goods. Most rural areas in India have borne the brunt of the lack of focus amongst the planners and authorities which are in charge of providing them with these basic facilities,  resulting in them being neglected, for the most part.

The PMGSY is a saving grace to places like these. With the focus being on the development of connectivity in rural India, it gives these areas hope of development and progress overall.

Better Employment Opportunities

Areas with better connectivity and sturdy roads and other amenities often reap the benefits of enhanced health facilities, employment opportunities, good educational institutions and a better quality of life, overall. Established companies always prefer to set up shop in areas that have great accessibility through well-connected roads and decent facilities.

Considering the fact that the PMGSY aims to enhance the quality of the same in rural India, this presents an opportunity for better employment and enhanced job roles.

Challenges faced by PMGSY

Lack of dedicated funds

The construction of roads is quite an expensive ordeal. Not only do the authorities require solid funding to construct decent roads, the maintenance and up-keep of those roads don’t come easy either. Irrespective of the fact that the roads are graded as all-weather condition roads, there will still be decay and eventual degradation of these roads as well, which would require regular maintenance.

Considering the fact that the Central Government’s revenues are already under stress, the availability of adequate funding presents a massive hurdle for the implementation of the PMGSY.

Inefficiency and lack of focus amongst the planners

If the lack of adequate funding wasn’t enough of a cause for worry, to add to it, there are various cases of the planners and the authorities-in-charge not taking the initiative, or in some cases, not taking enough of an interest to ensure that the roads are constructed in a quick and efficient manner. This lack of focus commonly results in wastage of material, thereby exceeding the budget of the project on a regular basis. 

Inconsistent working season and tough terrains

Hilly areas and areas with drastic weather conditions often pose a threat to construction and sometimes lead to wastage of material. Transportation of materials to such areas do come with challenges and additional costs involved.

Weather conditions tend to rain on parade, thus extending the project way beyond the estimated date. Moreover, the suspension or cessation of the work does affect the durability of the roads in the long run.

Lack of material and manpower necessary for construction

Based on the wastages that occur in almost every project, it is only inevitable that material necessary for construction would be scarce in one form or another. Moreover, labour doesn’t come cheap anymore.

The workers today make calculative decisions on whether to make themselves available for a particular project based on whether it is worth their time. This poses a real problem in terms of material and manpower for construction projects, in general.

Funding Pattern of PMGSY

The PMGSY was initially a 100% centrally sponsored scheme, but from the year 2015-16, the funding is shared between the Centre and the State as follows:

AreaPercentage of Funding from the Union GovernmentPercentage of Funding from the State Government
North Eastern and Himalayan States (Jammu & Kashmir, Uttarakhand and Himachal Pradesh)90% of the project cost10% of the project cost
Other States60%  of the project cost40% of the project cost

Gramin Agricultural Markets (GrAMs) under PMGSY

The current phase (Phase III) of the Pradhan Mantri Gram Sadak Yojana has the consolidation of major rural links, routes and connecting habitations to Gramin Agricultural Markets as one of its most important implementation objectives.

Gramin Agricultural Markets or GrAMs are retail markets that are within close proximity of farm gates, established with the objective of enhancing the efficiency in the transaction of the produce that is cultivated by the farmers. The efficiency in the transaction is brought about by the concept of:

  • Direct Sale

The consumer (either a retail purchaser or bulk purchaser) may transact with the farmer directly via a physical transaction or through virtual mode, courtesy of e-NAM, an online trading platform. This process eliminates the middleman completely, thus allowing the farmers to gain maximum value.

  • Lot Aggregation

This option enables the small-time farmer-producers to enhance their bargaining power through institutional mechanisms such as Farmers Producer Organisations (FPOs) and Village Producer Organisations (VPOs). Through these FPOs/VPOs, the lots of the small-time farmer-producers can be aggregated and eventually sold.

inline CTA
Get an expert at affordable price
For ITR, GST returns, Company Registration, Trademark Registration, GST Registration


Clear offers taxation & financial solutions to individuals, businesses, organizations & chartered accountants in India. Clear serves 1.5+ Million happy customers, 20000+ CAs & tax experts & 10000+ businesses across India.

Efiling Income Tax Returns(ITR) is made easy with Clear platform. Just upload your form 16, claim your deductions and get your acknowledgment number online. You can efile income tax return on your income from salary, house property, capital gains, business & profession and income from other sources. Further you can also file TDS returns, generate Form-16, use our Tax Calculator software, claim HRA, check refund status and generate rent receipts for Income Tax Filing.

CAs, experts and businesses can get GST ready with Clear GST software & certification course. Our GST Software helps CAs, tax experts & business to manage returns & invoices in an easy manner. Our Goods & Services Tax course includes tutorial videos, guides and expert assistance to help you in mastering Goods and Services Tax. Clear can also help you in getting your business registered for Goods & Services Tax Law.

Save taxes with Clear by investing in tax saving mutual funds (ELSS) online. Our experts suggest the best funds and you can get high returns by investing directly or through SIP. Download Black by ClearTax App to file returns from your mobile phone.

Cleartax is a product by Defmacro Software Pvt. Ltd.

Company PolicyTerms of use


ISO 27001

Data Center


SSL Certified Site

128-bit encryption