“The states in India seem reluctant to empower urban local bodies both functionally as well as financially.” Comment.

Introduction

Three decades after the 74th Amendment, urban local bodies remain closer to agencies than governments, because devolution under Article 243W is discretionary — the Constitution says states “may” endow municipalities with powers — and states have used that discretion sparingly.

Functional reluctance

• Few states have transferred all 18 Twelfth Schedule functions; town planning, water supply and housing often rest with parastatals and state-controlled development authorities.
• Executive power sits with state-appointed municipal commissioners, while mayors are frequently indirectly elected with short tenures.
• Smart City SPVs bypassed elected councils; ward committees and Metropolitan and District Planning Committees remain largely dormant.
• Municipal elections are delayed with impunity — Bengaluru's civic body functioned for years without an elected council — despite the Supreme Court's insistence on timely polls.

Financial reluctance

• Municipal revenue has stagnated at around 1% of GDP (RBI, Report on Municipal Finances), far below peers such as Brazil and South Africa.
• Property tax is under-exploited, and octroi and other local levies were subsumed into GST without a buoyant substitute.
• State Finance Commissions are constituted late and their recommendations ignored, leaving ULBs dependent on tied grants.

Conclusion

The reluctance is ultimately political economy: empowered mayors threaten MLAs and state ministries that control urban rents. Genuine empowerment needs mandatory functional devolution, predictable SFC-based transfers, property-tax reform and constitutionally enforced election timelines.