G RAM G MASKS ECONOMIC FAILURE

N 2011-12, roughly 100 million rural Indians sought work under the Mahatma Gandhi National Rural Employment Guarantee Act, which increased to 130 million last year.

- PRAVEEN CHAKRAVARTY

Expenditure on MGNREGA has increased 2.5 times in the last decade. Contrary to belief, this expansion of the scheme is not something to be proud of. Success of MGNREGA implies a failure of India’s economy. And this failure now has been disguised with a new tongue-twister of aname—Viksit Bharat Guarantee for Rozgar and Ajeevika Mission Gramin (VB G RAM G).

MGNREGA is a unique, world-class, Nobel Prize-worthy welfare programme whose success lies in its minimal use. Paradoxically called ‘employment guarantee’, it is, in practice, an unemployment insurance scheme. An individual in utter despair with no means of income can demand work and toil a whole day for minimum wages, guaranteed as a legal right. It is an elegantly designed, demand-based social safety insurance for the truly desperate—not a productive asset-creation scheme—that protected hundreds of millions of poor Indians during Covid.

If the nation’s economy was robust enough to generate an adequate number of well-paying jobs for unskilled labour, there would be minimal demand for MGNREGA. Only when the economy does not generate enough jobs for India’s vast labour force, will an unemployment insurance-type programme see strong demand and growing expenditure.