Overview of the Viksit Bharat—Guarantee for Rozgar and Ajeevika Mission (Gramin) Bill, 2025

The recent renaming of MGNREGA to Viksit Bharat—Guarantee for Rozgar and Ajeevika Mission (Gramin) Bill, 2025, has practical implications in public policy. While the name has changed, the core economic logic and structure of the programme remain intact.

Background and Evolution

• The original National Rural Employment Guarantee Act (NREGA) was enacted in August 2005 and became operational in February 2006.
• In October 2009, NREGA was renamed to Mahatma Gandhi National Rural Employment Guarantee Act (MGNREGA).
• The Act created a statutory entitlement to 100 days of wage employment per rural household, emphasizing labour participation and local asset creation.

Current Changes and Administrative Framework

• Despite the renaming, the programme's economic structure remains consistent. Wages are linked to work, employment is demand-driven, and assets are created through decentralized institutions.
• Enhancements include: 
  1. Greater use of digital attendance systems and geo-tagging of assets.
  2. Implementation of direct benefit transfers to reduce information asymmetry and leakage.
• This digital and administrative shift has increased compliance while improving allocative efficiency and expenditure quality.

Comparison with Cash Transfers

• Unconditional cash transfers offer political efficiency and short-term consumption smoothing, but lack multiplier effects and durable public assets.
• Employment-linked expenditure promotes long-term productivity through public works like rural roads and water conservation, providing both short-term income support and long-term benefits.

Implementation Challenges

• The case of West Bengal illustrates challenges with declining person-days generated and delayed payments due to governance failures and political confrontations.
• Effective institutional coordination ensures the scheme meets its objectives, while failures lead to costs borne by the poorest households.

Government's Pragmatic Approach

The government's approach is pragmatic, maintaining employment as a counter-cyclical stabilizer amidst economic challenges like climate volatility and rural distress. Discussions on extending work availability reflect responsiveness to changing economic conditions.

Conclusion

While the scheme's rebranding follows legislative practices, its survival and effectiveness are due to its economic function, transcending partisan identity. The emphasis remains on durable asset creation and labor participation over indiscriminate doles, signaling a preference for sustainable outcomes over mere nomenclature.