Jharkhand Risks Losing Rs 2,100 Cr in Central Funds Due To Delay In Municipal Polls

Jharkhand’s urban governance has largely been functioning through temporary administrative arrangements due to the prolonged delay in holding municipal elections. In the absence of elected mayors, chairpersons, and ward councillors, timely decision-making and effective monitoring of civic issues—such as waterlogging in drains, road conditions, street lighting, garbage collection, drinking water supply, sanitation, and encroachment—have been severely weakened.

Until April 27, 2023, Arun Kumar Jha served as the councillor of Ward No. 26 in Ranchi, the state capital. However, for the past three years, he has remained only a former councillor, without any administrative authority.

“The relationship between the public and their representatives has been broken,” Jha says. “Over the last three years, when water supply stops, streetlights stop working, sanitation issues arise, or other public problems occur, the link through which representatives and citizens together raise these issues with the government has completely collapsed. That is why garbage is piling up across the city, thousands of streetlights are non-functional, and water pipelines laid earlier are lying unused without any supply.”

Mayors, deputy mayors, chairpersons, chairmen, and councillors of all 48 urban local bodies in Jharkhand—including municipal corporations, municipal councils, and municipal panchayats—have been out of office for several years. The tenure of 12 such bodies ended in 2020, after which the government issued notifications relieving them of their posts. The remaining 36 bodies completed their tenure on April 27, 2023, and were similarly relieved through a notification issued that month. As a result, for nearly two and a half years, development work in all these bodies has been handled directly by administrators.

Urban development funds provided to urban local bodies under the provisions of the 74th Constitutional Amendment, and released by the central government, have remained completely stalled. According to Jha, the non-receipt of these funds has created a crisis in the city, with development work in all 53 wards of Ranchi remaining stalled for nearly three years.

Nazima Raza, former councillor of Ward No. 16, says the problem goes beyond stalled development. She says, “I served as a councillor for three consecutive terms. Many people are still unaware that elections have not taken place, so they continue to come to me every day, treating me as their councillor. Tasks such as the issuance of birth and death certificates, which earlier could be completed with a councillor’s signature or recommendation, have now been taken away from us.”

The final deadline for conducting municipal elections in Jharkhand to qualify for funds is March 2026. If elections are not held by then, the state will not receive funds for the last three financial years from the Centre under the recommendations of the 15th Finance Commission. This was stated by the Chairman of the 16th Finance Commission, Arvind Panagariya, during his visit to Ranchi on May 30, 2025. He said that if elections are conducted before March 2026, the previously withheld grants would be released. These grants relate to the financial years 2023–24, 2024–25, and 2025–26.

The Centre currently owes Jharkhand Rs 713 crore each for the financial years 2023–24 and 2024–25 due to the absence of municipal elections. Based on these calculations, the total pending amount for the last three years exceeds Rs 2,100 crore.

Former councillor of Ward No. 19 in Ranchi, Roshni Khalko, along with other petitioners, approached the Jharkhand High Court following the expiry of the tenure of urban local bodies and the continued delay in holding elections. The court observed that the absence of elections was weakening both public representation and accountability. It therefore directed the state to conduct elections as early as possible and summoned the state government multiple times to respond.

The state government cited reasons such as the “triple test” process related to OBC reservation and technical procedures like ward delimitation to justify the delay. However, the court repeatedly questioned why, despite constitutional provisions mandating timely municipal elections, there had been such a delay in fixing election dates. The High Court not only sought clear answers from the government and the State Election Commission, but also made strong observations and directed that the election process be expedited.

Speaking to Outlook, Roshni Khalko said, “Before the tenure ended, we met the Chief Minister twice and requested that municipal elections be conducted, but there was no response. In April 2023, we filed a writ petition in the High Court. The government filed an LPA, which the court rejected. Even after repeated directions for over a year, elections were not held. We then filed a contempt of court petition. After this, the court adopted a strict approach, and only then did the government start talking about holding elections.”

An LPA (Letters Patent Appeal) is an appeal filed within the High Court itself against the decision of a single judge, heard by a Division Bench. A contempt of court petition is filed when court orders are not complied with or when the dignity and authority of the court are undermined.

On municipal elections, the ruling coalition and the opposition have continued to trade allegations. Congress and Jharkhand Mukti Morcha (JMM) cite the triple test as the reason for the delay, while the BJP alleges that the ruling parties are avoiding elections out of fear of defeat, as the BJP is strong in urban areas.

Responding to this, Jharkhand Congress state media in-charge Rakesh Sinha told Outlook, “Urban voters are not registered BJP voters. As far as elections are concerned, the government moved forward, but the BJP created obstacles. They insisted that elections should not be held until the triple test was completed and even went to court over it.”

On the delay, Sinha said preparations for the elections were complete and that an announcement would be made soon. He added that the process had taken considerable time as the triple test survey had to be conducted across all 24 districts.

The BJP has also demanded that municipal elections be held on party symbols. Jharkhand BJP spokesperson Ajay Shah argues that the triple test is not a BJP demand but a pan-India Supreme Court ruling. He also notes that the court has permitted elections to be held even without completing the triple test.

“They simply do not want to conduct elections, which is why they kept postponing them on one pretext or another,” Shah says. “When the idea of holding elections by following the Madhya Pradesh model came up, they cited COVID and other reasons. They agreed to elections only after pressure from the court, especially when it spoke of imposing contempt.”

The triple test is a mandatory process laid down by the Supreme Court to be completed before implementing OBC reservation in local body elections. Its purpose is to ensure that such reservation is based on scientific, local body–level data rather than assumptions or general census figures. Historically, panchayat and municipal elections provided reservation for SCs, STs, and women, but OBC reservation was not clearly defined in state Panchayat or Municipal Acts. In this context, the Supreme Court, in its March 4, 2021 judgment in Vikas Kishanrao Gawali vs State of Maharashtra, mandated the triple test to enable OBC reservation in local bodies.

In Jharkhand, OBC reservation in municipal elections will be implemented for the first time under this framework.

The BJP believes it is well placed in municipal elections and has therefore pushed for polls on party symbols. However, it has become increasingly clear that municipal elections in Jharkhand will not be held on party lines. Surveys suggest the BJP has a strong hold over urban voters, and it has performed well in states where municipal elections are conducted on party symbols.

Jharkhand has traditionally held municipal elections on a non-party basis. This changed briefly in 2018, when the BJP government led by Raghubar Das amended the Municipal Act to allow party-based elections for posts such as mayor, deputy mayor, chairperson, and vice-chairperson. Elections held that year in 34 urban local bodies saw the BJP win 20, while Congress and the JMM won three each, and AJSU two. In municipal corporations such as Ranchi, Medininagar, Hazaribagh, Giridih, and Adityapur, the BJP won all mayor and deputy mayor posts. Jharkhand has a total of 48 urban local bodies: nine municipal corporations, 20 municipal councils, and 19 municipal panchayats.

After coming to power in 2019, the Hemant Soren government reversed this decision. In August 2021, the cabinet approved amendments restoring non-party-based municipal elections. Under the revised system, mayors are elected directly, while deputy mayors are chosen by elected ward councillors from among themselves.

This reversal triggered political debate, with critics arguing that the JMM and Congress lack a strong urban base, while the BJP dominates cities. Senior journalist Akhilesh Singh describes the issue as one of political mindset. “The BJP is an urban-based party. They believe contesting on party symbols gives them an edge because of their cadre strength in cities. If results reflected that, the BJP—despite being reduced to 21 Assembly seats—would want to send a statewide message that people are unhappy with the government,” he says.

To secure more than Rs 2,100 crore recommended by the Finance Commission, Jharkhand must conduct municipal elections by March this year, failing which the funds will lapse. Although election dates have not yet been announced, sources indicate a strong possibility that polls will be completed by February.

The responsibility for conducting panchayat and municipal elections lies with the State Election Commission, which operates under the state government. The Commission has stepped up preparations and released reservation lists for key posts. Among the nine municipal corporations, mayoral posts in Ranchi and Adityapur are reserved for Scheduled Tribes, Giridih for Scheduled Castes, and Hazaribagh for Extremely Backward Class-1, while Dhanbad, Chas, and Deoghar remain unreserved. The mayoral posts in Palamu and Mango have been reserved for women.

Similarly, chairperson posts in municipal councils and panchayats have been allocated across bodies based on SC, ST, OBC/EBC, and women’s reservation. According to sources, the State Election Commission may announce the municipal elections on January 27.