The proposed Viksit Bharat – Guarantee for Rozgar and Ajeevika Mission (Gramin) Bill marks a fundamental shift from a rights-based to a supply-driven approach in rural employment guarantee. Critically examine the implications of this transition for rural India.

Introduction

The Mahatma Gandhi National Rural Employment Guarantee Act (MGNREGA), enacted in 2005, revolutionised rural welfare by establishing employment as a legal right. The proposed Viksit Bharat – GRAM Bill seeks to replace this landmark legislation with a supply-driven framework. This transition raises fundamental questions about the future of rural livelihoods, federal relations, and the welfare state's role in ensuring economic security for India's 300 million rural workers.

1. Shift from Demand-Driven to Supply-Driven Framework

Fixed Budget Allocation: Under MGNREGA, funding was flexible and responsive to actual demand. The new Bill caps allocations based on "objective parameters" determined solely by the Centre, potentially leaving genuine employment needs unmet.

Central Control over Implementation Areas: Section 5(1) empowers the Union government to notify specific rural areas where the scheme will operate. This removes the universal coverage principle, potentially excluding vulnerable populations in non-notified regions.

Seasonal Pauses: The Bill permits suspension of work during peak agricultural seasons. While intended to ensure farm labour availability, this could deprive landless labourers of their only income source during critical periods.

Loss of Legal Guarantee: MGNREGA provided a justiciable right to employment with compensation for delays. The supply-driven model weakens this accountability mechanism, transforming entitlement into discretionary benefit.

2. Implications for Centre-State Financial Relations

Increased State Burden: The cost-sharing ratio shifts dramatically from 90:10 to 60:40 for most states. This 30 percentage point increase could strain already fiscally stressed state governments.

Differential Treatment: While northeastern and Himalayan states retain the 90:10 ratio, other states face quadrupled financial responsibility. States like Bihar, Uttar Pradesh, and Madhya Pradesh, with highest MGNREGA usage, will bear disproportionate burdens.

Reduced State Autonomy: Despite increased financial contribution, states lose operational autonomy. The Centre determines allocations, implementation areas, and parameters, creating fiscal responsibility without corresponding authority.

Impact on State Budgets: In 2023-24, MGNREGA expenditure exceeded ₹89,000 crore. The new sharing pattern could require states to collectively contribute approximately ₹36,000 crore annually, potentially crowding out other welfare programmes.

3. Positive Aspects and Way Forward

Increased Workdays: Enhancement from 100 to 125 guaranteed workdays addresses long-standing demands, potentially providing additional income of ₹7,000-8,000 per household annually.

Technology Integration: Codification of Aadhaar-based payments, geotagging, and mobile attendance systems can reduce leakages. Studies indicate digital reforms reduced corruption by approximately 25% in pilot districts.

Alignment with Viksit Bharat Vision: The Bill aims to integrate rural employment with broader developmental goals under the 2047 vision, potentially improving asset creation quality and convergence with other schemes.

Recommendations: Maintaining demand-driven flexibility within fixed allocations, phased transition of cost-sharing, and establishing independent grievance mechanisms could balance efficiency with rights protection.

Conclusion

The transition from MGNREGA to VB-GRAM represents more than administrative restructuring; it reflects a philosophical shift in state-citizen relations regarding economic rights. While technological improvements and increased workdays are welcome, the move from rights-based entitlement to supply-driven allocation risks undermining two decades of rural empowerment. A balanced approach preserving legal guarantees while improving implementation efficiency would better serve India's aspirations of inclusive development. The true measure of Viksit Bharat lies not merely in economic growth but in ensuring dignified livelihoods for every rural citizen.