The Backward Regions Grant Fund (BRGF) is aimed at catalyzing development in backward areas by:

(a)  providing infrastructure

(b)  promoting good governance and agrarian reforms;

(c)  converging, through supplementary infrastructure and capacity building, the substantial existing development inflows into these districts as part of  a well conceived, participatory district plan.

The scheme has two parts as follows:

(a)  Assistance provided to 250 selected backward districts across the country. At the Central level, the Union Ministry of Panchayati Raj would be the implementing Ministry for BRGF districts. The total annual allocation for assistance to Backward Districts is Rs. 3750 cr.

(b)  Special plans for Bihar and the Kalahandi-Bolangir-Koraput (KBK) districts of Orissa. At the Central level, this will be implemented through the Planning Commission. The total annual allocation under this head is Rs. 1000 crore for the Bihar Package and Rs. 250 crore for the KBK districts.

The funds are provided on a 100% grant basis and allocated as Additional Central Assistance to State Plans.

(a)                Two hundred and fifty districts will be covered under BRGF. This covers all Districts where the National Rural Employment Guarantee Programme is implemented and all Districts mentioned in an Inter-ministerial Task Group Report on Backwardness, constituted by the Planning Commission. A full list of districts is appended. 

(b)       The total annual allocation for the District Programme is Rs. 3750 crore for 2006-07. This will also continue for the entire 11^th Plan period (2007-2012). Of this amount Rs. 250 crore per annum at the rate of Rs. 1 crore per district is for capacity building and the balance is an untied development fund.

(c)        From the Rs. 3500 crore fund, each District is allocated a minimum annual allocation of Rs. 10 crore. 50 % of the remaining Rs. 1000 crore will be divided between the districts on the basis of its population and 50 % on the basis of area.

(d)        In 147 of the 250 districts where the Rashtriya Sama Vikas Yojana (RSVY) is being implemented, funds will be given to complete the ongoing programme under RSVY, following which the BRGF district programme will be implemented. In the remaining 103 districts, the BRGF programme will start straightaway.