Mahatma Gandhi National Rural Employment Guarantee Act (MGNREGA) completes 10 years today. Though scheme costs less than 0.35% of India’s gross domestic product (GDP),it gained much popularity and acceptance.
Several studies, over many decades, have shown that there is a strong correlation between rural agricultural wage rates and rural consumption/rural poverty. In fact, rural wages remained stagnant between 2000-01 and 2005-06 and it was after implementation of MGNREGA (from 2005-06 to 2010-11) that the growth rate of agricultural wages increased to 2.7% per annum for men and 3.7% for women.
Raising agricultural productivity is one of the fundamental objectives of MGNREGA. Works such as land levelling, making of embankments, drought-proofing, etc., have been undertaken on lands of lakhs of small and marginal farmers. Another study across six states showed that 85% of small and marginal farmers saw an improvement in land quality as a result of MGNREGA. Other independent studies also confirm that MGNREGA have led to an improvement in soil fertility and agricultural production and productivity.
The scheme gives the poorest households the ability to withstand economic shocks and deal with inflation—something they don’t otherwise have. Almost Rs1.55 trillion (65% of the total expenditure on MGNREGA since its inception) has been credited directly into the accounts of the MGNREGA workers through banks and post offices. A study by Crisil in 2012 shows that the increase in rural consumption seen in the last few years is partially due to MGNREGA. A recent study conducted by the Consultative Group to Assist the Poor (C-GAP)—World Bank (2013) in Andhra Pradesh shows that MGNREGA became a major source of income for poor households (40% of their income) in the lean agricultural season (May-June), saving them from falling back into poverty.
All the works under MGNREGA are for building rural infrastructure. Rural roads account for 15%, land development 25% and most visibly, water conservation structures for 50% of MGNREGA. The works may be of varying quality in different states.
It is because of the endeavour to constantly improve—check leakages, streamline money flows, institute more transparency, etc.—that detailed management information systems have been put in place that can track every worker and every work undertaken under MGNREGA.
MGNREGA has been a strong pillar on which the foundation of rural prosperity of the last decade has been based. One in four rural households have benefited from it, with at least 50% beneficiaries being women, scheduled castes and scheduled tribes. Of course, rural India needs more than just MGNREGA. But the contribution of this programme to the “India story”, and to rural revival in the last decade cannot be dismissed easily.
@Agency report.
