India's pioneering rural employment scheme, a globally unique legal right to work for the poor, is being hollowed out by the government of Prime Minister Narendra Modi, risking significant social and political unrest in the countryside.
The Bedrock of Rural Livelihoods
Enacted in 2005, the Mahatma Gandhi National Rural Employment Guarantee Act (MGNREGA) created the world's most far-reaching legal right to employment. It guaranteed any adult in rural India a job on local public works within 15 days of demanding it, with the government liable to pay an unemployment allowance if it failed to provide work.
The scheme has been a cornerstone of rural welfare, generating approximately 2 billion person-days of work annually for around 50 million households. It has been particularly transformative for marginalised groups, with over half of all workers being women and about 40% coming from Dalit and tribal communities.
For a nation where vast numbers depend on seasonal agricultural labour, MGNREGA stabilised incomes, raised rural wages, boosted women's bargaining power, and reduced distress migration. Households could demand up to 100 days of paid work at a statutory minimum wage, turning employment into an enforceable right.
A Rights-Based System Replaced by Centralised Control
Prime Minister Modi's administration has now replaced this rights-based framework with a centrally managed welfare scheme, known as VB-G RAM G. This fundamental shift, opposed by prominent economists like Nobel laureate Joseph Stiglitz and inequality scholar Thomas Piketty, centralises power in New Delhi while offloading financial responsibility onto India's states.
Under the new plan, the central government gains discretion over when and where the scheme applies, can impose funding caps, and transfers financial risk to state governments. Crucially, if the scheme is "switched off," a failure to provide work is no longer illegal.
Jean Drèze, a key architect of the original MGNREGA, argues this effectively provides "a work guarantee without any guarantee that the guarantee applies." He warns that poorer states, facing new liabilities, may simply ration access to avoid paying out, devastating those who rely on the scheme.
Echoes of Failed Farm Reforms and Electoral Peril
Remarkably, Mr Modi is employing a strategy that backfired dramatically just a few years ago. In 2020, his government passed three contentious farm laws aimed at deregulating agriculture. After year-long mass protests, primarily by farmers furious that crucial protections were removed without consultation, the laws were repealed in 2021.
The Prime Minister miscalculated then by assuming farmers would see market "freedoms" as opportunities. Repeating this approach with the rural jobs guarantee appears equally foolhardy. The scheme acts as a critical crisis buffer when monsoons fail, which is frequent in electorally pivotal states like Rajasthan, Madhya Pradesh, and Maharashtra.
A weak monsoon in the run-up to key state elections in 2028 and 2029 could see rural distress accumulate under the new limited and discretionary system. Under the old MGNREGA, job demand automatically expanded supply, diffusing blame. Under Mr Modi's plan, any failure will point directly at the central government in Delhi.
Grassroots Resistance and a Moral Reckoning
Jean Drèze is now backing grassroots protests, insisting the legal right to work still exists and must be honoured. The scheme's potency lies significantly with its female workforce, who learned through MGNREGA to claim wages and work as a right, not charity.
As seen during the farm protests, the prominent presence of women can turn technocratic policy disputes into powerful moral reckonings. If work is denied due to the new funding caps, a potent alliance of discontent in the courts, state legislatures, and on the streets could align once more, posing a severe challenge to Mr Modi's agenda.
