Central Sector Schemes: Benefits, Role & Challenges Faced|UPSC Notes

This goes to state that the economic as well as social development of India largely depends upon the implementation of various government programs, such as central sector schemes. Fully funded by the central government, they ensure that resources are allocated efficiently for specific purposes throughout the country. Emphasis is given to the responsibility of direct benefits of the central sector to the public without any contribution from the state.

• There is no share from state governments in the central government funding.
• Although the Central Sector Schemes are fully funded by the center, State Governments do not participate in terms of finance.
• This involves programs having relevance at the National level besides segments of society as well.
• It covers flagship schemes centrally sponsored by the central government in the sectors of agriculture, education, healthcare, etc.

GS Paper	GS Paper III
Topics for UPSC Prelims	Features of Central Sector Schemes, Examples of key Central Sector Schemes, Differences between Central Sector Schemes and Centrally Sponsored Schemes (CSS), and Budget allocations to Central Sector Schemes.
Topics for UPSC Mains	Role and impact of Central Sector Schemes on economic growth and development, Evaluation of the effectiveness of specific schemes

What is the Central Sector Scheme?

All are key national issues, and therefore, include all welfare measures which improve social welfare. Their scope is vast. They operate in diversified sectors, such as agriculture, health, and education. They bring direct benefits to the underprivileged communities. The schemes are directly executed and monitored by the central government to perform well throughout the nation.

Central Sector Scheme vs Centrally Sponsored Scheme

Here’s a comparison between Central Sector Scheme and Centrally Sponsored Scheme in tabular form:

Aspect	Central Sector Scheme	Centrally Sponsored Scheme
Funding Source	Fully funded by the central government	Co-funded by both the central and state governments
Management	Managed directly by the central government	Implemented by state governments with central oversight
Implementation Focus	Targets national-level issues and priorities	Focuses on state-specific needs and issues
Financial Contribution	No financial participation from states	States contribute a specified percentage of funding
Example Schemes	Pradhan Mantri Kisan Samman Nidhi, Make in India	Mahatma Gandhi National Rural Employment Guarantee Act
Target Beneficiaries	Primarily targets the entire nation	Targets specific state populations and demographics
Flexibility	Limited flexibility in implementation based on local needs	More adaptable to local conditions and requirements
Scope of Benefit	National scope, addressing broad developmental goals	Regional scope, catering to specific state requirements
Monitoring	Directly monitored by the central government	Monitoring involves both central and state governments

List of Central Sector Schemes

Scheme Name	Objective
Pradhan Mantri Kisan Samman Nidhi (PM-KISAN)	Provides direct income support to small and marginal farmers.
Pradhan Mantri Awas Yojana (PMAY)	Aims to provide affordable housing to the urban poor.
National Health Mission (NHM)	Enhances healthcare services across rural and urban areas.
Make in India	Promotes manufacturing and encourages domestic and foreign investment.
Atmanirbhar Bharat Abhiyan	Promotes self-reliance and boosts local industries.
Digital India	Aims to transform India into a digitally empowered society and knowledge economy.
Skill India	Enhances the employability of youth through skill development programs.
Pradhan Mantri Gram Sadak Yojana (PMGSY)	Provides all-weather road connectivity to unconnected villages.
Beti Bachao Beti Padhao	Aims to improve the welfare and education of the girl child.
Swachh Bharat Mission	Focuses on cleanliness and sanitation across urban and rural areas.
Ayushman Bharat	Provides health insurance coverage for economically vulnerable families.
National Livelihood Mission (NLM)	Promotes self-employment and organization of rural poor.
Pradhan Mantri Fasal Bima Yojana (PMFBY)	Offers crop insurance to farmers against natural calamities.
National Education Policy (NEP)	Aims to overhaul the education system in India for better quality.
Pradhan Mantri Suraksha Bima Yojana (PMSBY)	Provides accidental death and disability coverage.

Benefits of Central Sector Schemes

There are many benefits of Central Sector Schemes. First, the schemes are directly funded by the central government, therefore ensuring proper use of resources, selective development, transparency, and equal implementation in every state, which guarantees national growth and welfare. The most advantages attributed to Central Sector Schemes contribute to the growth of India as a whole:

Direct Funding and Control

These schemes are 100% centrally funded, hence, the resources are well-allocated and controlled. Centralized control minimizes delays in activities and facilitates swift decision-making, hence leading to effective implementation in many fields, such as agricultural, educational, and health development.

Uniform Implementation Across States

Since the schemes are centrally funded, equal support is rendered by all states irrespective of their financial capacity. Thus, development efforts are more or less consistent throughout the nation with less disparity between richer and poorer states, and national progress appears to be more resilient.

Support to National Level Priorities

As these schemes are used for solving the problems of National importance, like defense, space research, and nuclear energy, they strengthen the nation about security, technological front, and also world position.

Strengthens Social Welfare

Several of the Central Sector Schemes are actually meant to enhance the health, education, and finance of socio-economically disadvantageous sections of society. This is sure to reduce inequality and improve the lives of those at the periphery, making for a more just and equitable society.

Quick Emergency Response

Centralized control of schemes is given whereby immediate mobilization of the available resources can be done in case of emergencies, such as pandemics or natural disasters. It will give the government the immediate response regarding financial aids, healthcare services, and relief services required at the affected areas.

Increases Innovation and Growth

Make in India and Atmanirbhar Bharat central sectors schemes boost sectors and contribute towards self-reliance. Such investment in research and technology enables faster economic growth, besides generating jobs for the citizens.

Boosting Economic Growth

The Central Sector Schemes thus channel the important sectors of a country: agriculture, industry, and infrastructure. This helps generate employment, increasing productivity, and strengthening the economy’s long-term.

Problems Encountered in Operating the Central Sector Schemes

Central Sector Schemes are not without challenges that act to retard their effectiveness. Over and above the various benefits central sector schemes enjoy, it also suffers from some challenges. Some of them include the following: 

Bureaucratic Delays

Poor paper work and lengthy time for sanctioning the schemes can delay their implementation, thus delaying the delivery of the schemes’ benefits to the target population and also lowering scheme efficiency.

Problems of Monitoring and Evaluation

Proper expenditure of funds in different states is not easy to ensure. Poorly coordinated monitoring and evaluation systems can lead to the poor use of resources, low efficiency, or lack of accountability in the implementation process.

Limited Use of Local Context

Centralized control may not be aware of regional needs and specific local issues. This therefore leads to a poor implementation, as the schemes may not be meeting the needs of the local issues or preferences.

Lack of Awareness

The beneficiaries are generally unaware of the benefits that can be gained through the Central Sector Schemes. Lack of awareness and outreach lead to low participation, while deserving individuals or groups are unable to avail themselves of the opportunity.

Coordination problems with State Governments

Although the schemes are centrally funded, some schemes require coordination with the state government in order to be implemented. Poor coordination between the central and state government may cause a delay, inefficiency, or even the complete failure to execute the scheme.

Infrastructure Constraints

Most regions are undeveloped and lack the infrastructure required to implement some schemes. For example, basic healthcare or education programs might not easily reach rural or remote places that lack the most basic infrastructure. Therefore, it is restricted in its reach, which further hinders its influence.

Human Resource Deficiencies

Many areas do not have technical staff to implement and operate the projects. Consequently, the service delivery quality and even lower rate of growth become compromised, thus reducing the program’s success.

Resistance to Change

In other communities, the people resist changes from the government due to cultural, social, and even political causes. It is tough to implement such projects with such societies, since the education and involvement of such communities is a hard nut to crack.

Economic Impact of Central Sector Schemes

It is hard to overstate the impact of Central Sector Schemes on the economy. This is because so many schemes have bettered infrastructure, enhanced social welfare, and pumped life into the economy. Make in India and Atmanirbhar Bharat Abhiyan have been powerful schemes that uplifted the manufacturing base of India and led to high employment generation. In line with agriculture and healthcare, several schemes have bettered the lives of millions and thus led to a betterment of the economy.

Apart from these provisions, the rest that are equally important and well serve their role are Central Sector Schemes. This encourages innovation, such as science, technology, and defense schemes, which have steered India towards growth in space research, atomic energy, and in the digital fields.

Role of Central Sector Schemes on Social Welfare

Central sector schemes address the most relevant social problems, and this encompasses poverty elevation, healthcare, and education. For example, Pradhan Mantri Awas Yojana–Urban is a scheme for affordable housing, while Ayushman Bharat focuses on health insurance benefits for the poor.

Poverty Reduction

Central Sector Schemes such as Pradhan Mantri Kisan Samman Nidhi provides direct support to vulnerable sections of farmers directly, reducing rural poverty, and stabilizing the incomes of the agricultural sector. Beneficiaries numbering more than a million are helping families across the country.

Improvement in Health

Schemes like Ayushman Bharat offer free health care to the economically weaker sections, ensuring all such critical medical treatment is accessible to end the financial burden of health care in order to end it as a major source of worsening health to disadvantageous communities in India.

Housing for All

Provision of Housing for Low-income Families by Pradhan Mantri Awas Yojana – Urban and Rural: This scheme is meant to provide housing for low-income families at budget-friendly rates. A financial assistance in building homes would mean roofing the homeless and the elevating in the living standards of poor families.

Empowerment of Women

Programs like Beti Bachao Beti Padhao try to develop girls through education and protection. It enforces welfare schemes for girl children that favor gender equality as well as empowerment of the female of the house in a traditional setup.

Food Security

Central programs like Public Distribution System empower people belonging to deprived groups by making food grains available at subsidized rates. This is likely to enhance the level of food security as well as prevent malnutrition that impacts health adversely.

Disaster Relief

Relief in terms of financial compensation and rehabilitation during natural calamities is given through schemes under the Central Sector so that relief could be received by the affected community rapidly. Vulnerable groups are further protected under relief funds as well as immediate interventions.

Conclusion

Central Sector Schemes are, therefore, still valid for India’s growth. They provide focused central government intervention in critically important areas as well as an important role in social and economic development. A proper understanding of central sector schemes and centrally sponsored schemes helps better explain the scope and importance of these programs.

Central Sector Schemes UPSC Notes

1. Central Sector Schemes are fully funded by the Union Government and implemented directly by central agencies. 2. These schemes primarily focus on subjects listed under the Union List, such as defense, railways, and atomic energy. 3. Central Sector Schemes aim to promote uniformity in development across states by providing centralized resources. 4. These schemes often address national priorities like infrastructure development, health, education, and agriculture. 5. Key examples include PM-KISAN, Pradhan Mantri Swasthya Suraksha Yojana, and the National Health Mission. 6. The Union Budget allocates specific funds for these schemes, ensuring consistent financial support. 7. Central Sector Schemes provide direct benefits to citizens through subsidies, incentives, and welfare programs. 8. These schemes play a vital role in boosting economic growth and addressing social disparities across the country.

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