Few countries have attempted anything as ambitious as India’s rural jobs guarantee. Under the Mahatma Gandhi National Rural Employment Guarantee Act, any adult in the countryside who demanded work was entitled to a job on local public works within 15 days, failing which the government had to pay an unemployment allowance.
Enacted in 2005, the act created the world’s most far-reaching legal right to employment. It generates 2 billion person-days of work a year for about 50 million households. More than half of all workers were women, and about 40 percent came from Dalit and tribal communities.
For a country where vast numbers rely on seasonal farm work, the scheme mattered. It stabilized incomes, raised rural wages, expanded women’s bargaining power and reduced internal migration. Households could demand up to 100 days of paid work at a statutory minimum wage, turning employment into an enforceable right. The World Bank derided it as a “barrier to development” in 2009 — but praised it as “stellar” five years later.
However, Indian Prime Minister Narendra Modi has replaced this rights-based system with a centrally managed welfare scheme, VB-G RAM G, a shift opposed by the Nobel laureate Joseph Stiglitz and the inequality academic Thomas Piketty.
Modi usually shrugs off criticism, but this time, he might have overreached. As the employment guarantee act architect Jean Dreze said, the new plan centralizes power while offloading responsibility. The central government gains discretion over when and where the scheme applies, caps funding and shifts financial risk to Indian states. If the scheme is “switched off,” failure to provide work is no longer illegal.
Dreze is right to say that this is “like providing a work guarantee without any guarantee that the guarantee applies.” The old system had its flaws: inefficiency, underfunding, corruption — but the answer is reform, not repeal. Poorer states, facing new liabilities, might simply ration access to avoid paying out.
Remarkably, Modi is attempting to prevail with arguments that have failed him before. His government in 2020 passed three “farm bills” that aimed to shift Indian agriculture away from a state-led administered-price system toward a more market-based model. They were repealed in 2021 after year-long protests. Farmers were furious that protections they relied on were taken away without consultation. Modi miscalculated in thinking that farmers saw market “freedoms” as opportunities. Repeating this with rural jobs seems foolhardy.
When monsoons fail, employment guarantees become crisis buffers. Indian states such as Rajasthan, Madhya Pradesh and Maharashtra are drought-prone and electorally pivotal. Rajasthan and Madhya Pradesh vote in 2028 in regional polls; Maharashtra follows in 2029. A weak monsoon in 2026-2027 would allow rural distress to build up under a limited and discretionary scheme. Climate shocks could translate into electoral judgments by polling day. Under the old system, job demand automatically expanded supply, diffusing blame; under Modi’s plans, the finger would point squarely at Delhi.
Dreze is backing grassroots protests, insisting the right to work still exists and must be honoured. Its potency lies with female workers who learned, through the employment guarantee act, to claim wages and work — not charity.
As with the farm protests, women’s presence turns technocratic disputes into moral reckonings. If work is denied because of Modi’s new caps, discontent in the courts, states and streets could again align, as it did before the farm bills fell.
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