The Indian Prime Minister being the de facto head of the Indian government is the most influential and commanding persona in the country. The prime minister, as the Indian Constitution enshrines, exercises the powers vested in the President of India, who is the de jure (legal) head of the nation. The PM also carries out the responsibilities and functions that the constitution has bestowed on the President. Towards that end, the PM of India acts as an agent or representative of the Indian president. All official documents, dossiers, white papers, press releases, and all other documentations published and released by the Govt. of India has to be ratified by the president and must carry his official seal.
The PM heads the Council of Ministers and is the chief of the executive wing of the Indian government. After a round of general elections, the leader of the party that wins the majority of seats in the Lok Sabha (the lower house of the Indian Parliament that happens to be a bicameral legislature) is officially sworn in as the PM by the President. Thereafter, the PM goes on to appoint ministers for different portfolios and the entire bloc of ministers is known as Council of Ministers.

He then forms a cabinet that comprises of ministers holding the key portfolios of the government like finance, railways, defence, home, foreign affairs, and so on. The PM is elected for a term of five years and after the expiry of his tenure fresh general elections are held for the election of a new incumbent. The PM continues to hold office as long as his party enjoys majority in the Parliament. The incumbent government can be brought down by the Opposition through a vote of ‘no confidence motion’ if it can prove that the ruling party has lost its majority in the legislature.
The remuneration, perks and incentives of the Indian Prime Minister

One would be naturally inclined to assume that the salary of the PM would be staggering considering the fact he occupies the topmost political office in India but the numerical figures belie such a supposition. The Indian President being the legal head draws the highest salary and the PM’s total emoluments is a notch less than the Presidents.
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When you talk about the remuneration of the PM, you have to take into account the numerous perks, incentives, and bonuses that he is entitled to apart from his gross salary. The PM has the privilege of living in an expansive bungalow with a posse of SPG security personnel for his round the clock security and an outer cordon of policemen that provides foolproof security to the PMO. Add to that the cost of maintaining his office, salaries of officials and personal secretaries and assistants entrusted to help him in the discharge of his duties and so on. The salary of the PM is mentioned in Article 75 of the Indian Constitution. The incumbent PM receives a gross salary of 1, 60, 000 INR per month.

The following table gives a break-up of the emoluments the present PM is entitled to receive.

Allowance Head Receipts (in INR)
Basic Pay 50 000
Sumptuary Grant 3 000
Daily Allowance 2 000 (62 000)
Constituency Grant 45 000
Gross Receipts 1 60 000

The following table gives a budgeted estimate of the Prime Minister’s Office (PMO) for the financial year 2012-13
Accounting Head Budgeted Estimates (in thousands INR)
Salaries 200 000
Medical Reimbursements 6 000
Conveyance (domestic) 4500
Conveyance (International) 30 000
Office Expenditures 35 000
PM's discretionary Funds 2500
Grants-in-Aid 13 000
Miscellaneous Administrative Expenses 100
IT Expenses 500
OTA 2200
Total 293800

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The following table presents a typical monthly expense statement of the PMO for the year 2012-13 (December 2012)

Expense Head Expenditure ( INR )
Salaries 18 029 599
OTA (overtime allowances) 200 173
Office Expenditures 2351458
Travelling Expenses (Domestic) 575 251
Medical Expenses 97 595
Sundry Administrative Expenses 39326
Cumulative Total 21292592