The key to effective decentralization is Political decentralization should follow financial decentralization. Discuss in context of impediment faced by local governance in India.

73rd and 74th Constitutional amending act has provided for Panchayati Raj Institution and Urban Local bodies at third tier of government. Impediments in local governance: A Funding - Inadequate funds to Local governments LGs merely reduced to agents of higher level governments. B Conditional grants: Affects discretion of LGs. Eg: 15th FC recommendation of conditional grants w.r.t reforms in Drinking water, sanitation etc. C Resource generation: LGs have very poor their own (tax and non tax) revenue generating capacity as they go ahead have [Pervasive] law taxes and collect it.