What major step was taken in 1992 to make the third tier of democracy more powerful and effective in India?
Correct: C
The Constitutional Amendment of 1992 (73rd and 74th Amendments) made it mandatory to hold regular elections to local government bodies (Panchayati Raj and Municipalities), reserve seats for SCs, STs, and OBCs, and ensure financial autonomy for these bodies, thereby significantly strengthening decentralisation.