There's a Need to Reimagine MGNREGA for a Modern Economy

The two decades since the passage of the act have seen tremendous changes

- Sonalde Desai

The year 2025 marks the 20th anniversary of the Mahatma Gandhi National Rural Employment Guarantee Act (MGNREGA). The programme design, resulting from a unique collaboration between bureaucrats and civil society, reflects a rights-based approach where 100 days of manual labour are to be provided to any rural household. It is the largest government programme with its budget reflecting 17% of the total budget for centrally sponsored schemes.

By ensuring equal wages for men and women and work close to home, it provided employment to women whose other options are limited. By expanding definition of acceptable activities such as construction of sheds for livestock and improvement of farmland for individuals, it improved entrepreneurial opportunities. MGNREGA emerged as a powerful safety mechanism during crises such as the covid-19.

Nonetheless, the two decades since the passage of the act have seen tremendous changes in India's economic and social landscape and some cracks in the programme structure have become increasingly evident.

First, under both UPA and NDA governments, budgetary allocations have never been sufficient to provide 100 days of work to all rural households. In spite of spending nearly 100% of its budgetary allocation, the act has only been able to provide 45-55 days of work for participating households.