Decentralization: an effective method of financial management at the grassroots (evidence from India)

Haryana is among the 20 Indian states currently implementing the Joint Forest Management Programme (JFMP). Protection and management of degraded forests by village level institutions - hill resource management societies (HRMSs) - in partnership with the Haryana Forest Department could be described as a significant step in delegation and to an extent in devolution of forest protection and management roles and responsibilities. A significant outcome of JFM to the HRMSs has been the enormous funds that have been generated at the village level. These have been expended to fulfil community needs. <P>A study conducted in five HRMSs to understand the mechanism of fund utilization revealed that major portions have been utilized for human development and lesser amounts for forest development activities. The process adopted has been one of consensus with well established mechanisms for regulating misuse. The success of the study villages has been presented as evidence in support of successful decentralization and financial management at the grassroots and the potential of many HRMS type institutions to develop into strong institutions with a high degree of institutional and financial sustainability. Copyright © 1999 John Wiley & Sons, Ltd and ERP Environment.