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MGNREGA helps in reducing poverty, says study

By NewsGram Staff Writer

Mahatma Gandhi National Rural Employment Guarantee Act (2005) promises 100 days of wage employment in each financial year to rural households. A recent study shows that it is because of this scheme that there is a notable reduction in poverty in India between 2004-05 and 2011-12.

15in_village_694702f26,000 rural households were interviewed twice- in 2004 before MGNREGA was introduced and later in 2011, after the introduction of the scheme. The survey was carried out by IHDS, Indian Human Development Survey.

IHDS, in a report released on Wednesday, has found the scheme to have reduced poverty among participant households to 31%. Out of the entities interviewed, 30% of them participated in the scheme along with 21% non-poor rural households.

Contradictory to the popular view that MGNREGA has raised rural wages, the study points to the fact that wages indeed rose sharply from 2004-05 to 2011-12, but the wage rate growth in high-level participation of MNREGA and low-levels of it, are almost the same. The issue that this report highlights is that women empowerment has come ashore because of this Act. For nearly 45% of women work under this scheme. Most of these women were disguised 21iit4employed or unemployed in 2004-05. MGNREGA enabled 49% of women to have their own bank accounts in 2011-12.

As a result of this, the report also noted a significant reduction in borrowings from moneylenders and encouraged self-reliance among MGNREGA participants.

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