What you need:

Thin Cardboard
Red Craft Paper
Coloured Sponge
Fevicol
Pencil
Decorative small sequins 
Decorative small stars
Scissors
Fancy Thread or Satin Ribbon
 

Lets Begin:

1. Take a thin cardboard, and cut it into a small circular shape.

2. Stick the red craft paper on the cardboard with Fevicol.

3. With the help of the scissors cut the edges of the circle into a zig-zag shape.

4. Take a thin coloured sponge, and cut it according to the same size of the cardboard.

5. Give zig-zag shaped edges to the round sponge as well.

6. Stick the sponge over the cardboard. 

7. With a pencil draw a plus sign on the spunch. Make sure you draw the line with very lightly, or else it might tear the delicate sponge.

8. Stick the whole plus sign with stars.

9. In the remaining area, stick colourful small sequins.

10. On the back of the cardboard, stick the fancy colourful threads available in the market or use a satin ribbon, long enough to be tied on the wrist.

Your Fancy Colourful Rakhi is Ready.