By introduction of new Panchayat Raj Institutions (PRIs) under 73rd Constitutional Amendment, a new era of people-centric local governance has been established in India in 1990s and Bihar had actual experience of these institutions with firs PRIs elections in the year 2001. It was hoped that the two basic objectives-realization of Gandhian dream of 'gram swaraj' and making PRIs effective tools of faster pace of rural development-would be realized soon. But things could not change fast as the governance at grassroots level through the PRIs had not been good. In other words 'Good Governance' became they key term to realize. It has been consensus among the scholarship on the following tasks to achieve for the good governance in a country like India-efficient service delivery with transparency and effective partition of people at all levels of policy making and execution. Several steps are being taken to make these institutions effective in terms of good governance by the present Bihar Government and adequate resources are being also provided. The pace of development in the state has been accelerated; however, simply economic development is not sufficient to develop rural Bihar socially and politically. Thus the goal of 'good governance' in rural Bihar requires to be achieved. Efficient, transparent, responsive, effective, participative, accountable, just (rule of law) and corruption less governance are some of the most striking components of good governance. It is also argued that unless the people are aware and well informed, they cannot participate substantially in the governing process. On the other hand, if people are not substantially participative in the governance process, good governance cannot be established. It cannot be denied that good governance and real democratic rule begins at the grassroots level.
The constitutional and leal provisions have emphasized the actual devolution of function and finances on all the three tiers of the Panchayati Raj Institutions. In spite of real devolution of functions and finances, the real fruits cannot be reaped unless there is good governance at the panchayat levels. For which the elected executives and appointed executives should work hand in hand and keep accountable to the people. The people's views are to be necessarily assured to be heard in the governance process. If we look the structure of the PRIs, it assures opportunities of people's substantial participation, participation of weaker sections, transparency, responsiveness and accountability in delivery of services and governance.