The proper implementation of centrally sponsored schemes is crucial in ensuring equitable development and bridging regional disparities. Identifying the factors influencing performance is an essential step towards improving implementation procedures and eliminating regional disparities. This study sought to evaluate the regional disparities in performance levels and to investigate the factors affecting the performance of centrally sponsored schemes. Using a composite performance index, the study assessed the performance levels at inter-district and intra-district levels. The study found that districts like Kupwara and Anantnag exhibited higher performance levels compared to districts like Srinagar, Pulwama, Shopian, and Ganderbal, which displayed lower performance levels. Moreover, most blocks fall under the low or medium-performing category. The study identified fund availability, fund utilization, socio-economic development, poverty levels, low wages rates, migration, physical setting, and lack of official staff as the factors affecting the performance of centrally sponsored schemes. Finally, the study recommends the policymakers to improve implementation procedures and address the flaws in ongoing schemes, especially in low-performing regions, to bridge the regional disparity gap and promote equitable development across all regions.