Friday September 21, 2018
Home India MGNREGA to em...

MGNREGA to employ at least 52 million Indians in the next 20 years

0
//
144
Image source: nregs-mp.org/
Republish
Reprint

New Delhi: There is a 14-percent rise in the programme run under the Mahatma Gandhi National Rural Employment Guarantee Act (MGNREGA) in the 2016-17 Budget, the world’s largest state-run jobs plan, after a decade of operation continues to be India’s top poverty mitigation programme.

MGNREGA, which guarantees 100 days of work to unskilled people in villages of India, will employ at least 52 million people and provide livelihoods to their families. That means about 260 million (considering an average family of five) will depend on it over the next 20 years, according to an analysis.

In three years MGNREGA funding has raised up to 18%. Unlike last year, though, when the programme exhausted its money by December, it is unclear what might happen this year when — which is more likely than if — the money runs out.

In 2015-16, there was a cushion of Rs5,000 crore in case the ministry over its money, but New Delhi released only Rs.2,000 crore of that money, according to Aruna Nikhil Roy of the People’s Action for Employment Guarantee, a Delhi-based NGO.

More Indians are still poor than the population of Indonesia. The unqualified number of poor as well as the proportion of poor below the poverty line (according to the Tendulkar poverty line) has been declining over two decades, as we reported.

But about 270 million are still below the poverty line, more than the population of Indonesia (255 million), the world’s fifth-most populated country. The poverty line is the ability to spend Rs.47 per day per person in urban areas and Rs 32 in rural areas.

MGNREGA is being lauded for its achievements in the past decade. Around 277.9 million people are registered under the scheme, and 98.3 million of them are active workers. The programme covers all adults from rural households who seek employment.

The “work” under MGNREGA covers “unskilled manual labour”, providing an opportunity to every person who needs employment. Without skills, young Indians in rural areas will need MGNREGA.

To know exactly how many Indians will need employment in the coming years, the illiterate rural population was scrutinised, according to the 2011 census. There are 51.7 million illiterate people aged 16 to 30.

Since they will not benefit from the Right to Education, which guarantees free and compulsory elementary education till age 14, this population will not be a part of India’s skilled labour force.

According to this International Labour Organisation definition, skills require at least five years of schooling. So, for at least 20 years, MGNREGA will likely need to support this group of Indians.

A word of caution: This 52 million (rounded-off) population includes only illiterates from the Census 2011 data. There are many among the literate population who have basic reading and writing skills but are not skilled enough to work in industry.

MGNREGA critics contend that the scheme does not help pare poverty because of corruption and poor implementation. “From a policy point of view, we should be interested in the efficiency of transferring incomes to the poor,” economist Surjit Bhalla wrote in a column recently.

With no cost-benefit valuation of MGNREGA work and no technical support, the programme struggles to create assets or infrastructure in rural areas, which it should, Indian Institute of Technology (Delhi) economics professor Reetika Khera, wrote in a recent column.

MGNREGA is short of funds- 17 percent of its budget went into paying wages and material from the previous financial year, according to a letter from Ministry of Rural Development to the Ministry of Finance.

The actual allocation for MGNREGA this year is around Rs.29,000 crore ($4.6 billion).

This fund squeeze for MGNREGA is not new and has been evident under both the United Progressive Alliance II and the National Democratic Alliance regimes. Ending the year with pending obligations, which effectively means workers’ wages are unpaid, has been a consistent trend.

As much as 95 percent of the budgetary allocation for the current financial year (2015-16) was exhausted by December 30, 2015. Further, as per the Ministry of Rural Development and Ministry of Finance calculations, state governments require at least an additional Rs.6,300 crore to pay wages and other expenses.

The drought-affected states of Odisha, Madhya Pradesh, Karnataka, Andhra Pradesh, Telangana and Uttar Pradesh will provide 150 days of employment against the normal 100-but there is no extra money evident, from Delhi or in their budgets.

Finance Minister Arun Jaitley’s budget for MGNREGA may not be enough. Under the devolution recommendations of the 14th Finance Commission, India’s states have been given more money, and hence more powers, to decide how they want to finance social welfare.

The one-time Planning Commission had 66 centrally sponsored schemes, reduced to 30 under the NITI Aayog, the body that has replaced the Planning Commission. MGNREGA is one of these 30.

Even though the central government has transferred social welfare to the states through “devolution” (transfer of powers-fiscal or administrative-from higher level of government to lower level of government), it will pay for important programmes, such as NREGA and rural roads.

Jaitley said in his budget speech: “In spite of the consequential reduced fiscal space for the Centre, the government has decided to continue supporting important national priorities such as agriculture, education, health, MGNREGA, and rural infrastructure including roads.” (IANS)

Click here for reuse options!
Copyright 2016 NewsGram

Next Story

Is investing in Bitcoin safe? Get the basics first!

0
India has not legitimized bitcoin, hence investment returns are totally based on demand i.e. you get your return only if there is another buyer in the market who is ready to pay you more for it. Currently the high-value of the digital currency owes to its high demand, but once people start selling, there is a possibility that rates will drastically fall. Pixabay
India has not legitimized bitcoin, hence investment returns are totally based on demand i.e. you get your return only if there is another buyer in the market who is ready to pay you more for it. Currently the high-value of the digital currency owes to its high demand, but once people start selling, there is a possibility that rates will drastically fall. Pixabay

With the fussy mania of Bitcoin going around and past, your eyes and ears, in the news and peer discussions, you must be having some basic questions about it: What is bitcoin? Is it legal? How can I get it? But most of all, you must be thinking, ‘Is investing in Bitcoin safe?’

Let’s find out!

Pluto Exchange has launched first app that will trade in bitcoins in India
Pluto Exchange has launched the first app that will trade in bitcoins in India. Wikimedia commons

ALSO READ: Bitcoin Worth Millions Stolen Days Before US Exchange Opens

Clearing the basics

  • Bitcoin is the first ever cryptocurrency that existed, it was invented in 2009 by Satoshi Nakamoto.
  • Cryptocurrencies are nothing but computer codes that have monetary value. No Government has any control over them.
  • Bitcoins ‘self-contain’ their value i.e. there’s no need for any bank to move or store the money.
  • Bitcoin currency is completely unregulated and decentralized.
  • Bitcoins are mined, and they can be mined by anyone in the general public who has a strong computer. However, only 21 billion of bitcoins in total can be mined. Currently, there are around 11 million in circulation.
  • Bitcoin has no underlying physical monetary base to support its value, and it is totally subject to its demand in the market.

What are the risks?

  • Low demand: India has not legitimized bitcoin, hence investment returns are totally based on demand i.e. you get your return only if there is another buyer in the market who is ready to pay you more for it. Currently, the high-value of the digital currency owes to its high demand, but once people start selling, there is a possibility that rates will drastically fall.
  • Unregulated: There is no bank or government tax agency that can track your money and its movement. Hence, it can become a tool for money laundering.
  • Irreversible transactions: There is no insurance protection of your bitcoin wallet i.e. if you lose your wallet’s hard drive data or even your password, your wallet’s content is gone forever.
There is no insurance protection of your bitcoin wallet i.e. if you lose your wallet’s hard drive data or even your password, your wallet’s content is gone forever. Pixabay
There is no insurance protection of your bitcoin wallet i.e. if you lose your wallet’s hard drive data or even your password, your wallet’s content is gone forever. Pixabay

ALSO READ: How can you trade in Bitcoin in India?

Status of Bitcoin in India

Finance minister Arun Jaitley highlighted in a statement that cryptocurrencies are not legal tender and have no regulatory permission or protection in the country.

However, there was no announcement banning or imposing any curbs on the same. The government panel is also awaiting a report on tackling cryptocurrencies in India, Jaitley said.

The government has recently cautioned investors to be wary of virtual currencies like bitcoin, saying they are like Ponzi schemes with no legal tender and protection.

“One of the features of cryptocurrency is that there is lack of dependence on the state. It functions with a degree of anonymity. It operates within a virtual community which is created and enjoys the trust of that virtual community,” Finance Minister Arun Jaitley told the Rajya Sabha.

“The government is examining the matter. A Committee under the chairmanship of the Economic Affairs Department Secretary is deliberating over all issues related to cryptocurrencies to propose specific actions to be taken… Instead of taking any knee-jerk action, let’s wait for the report of this committee.” Jaitley added