NEW DELHI — The world’s largest public employment plan, India’s job guarantees for rural workers, could be hollowed out by new legislation, the program’s defenders warn.
Two decades ago, India launched what many economists and development experts hailed as a revolutionary program that enshrined employment as a right and reduced poverty.
The approach reverberated far beyond India’s borders. The program’s design — a demand-driven, legal work guarantee — inspired large-scale public works and social programs across the Global South, including in Bangladesh, Ethiopia and South Africa.
It became one of the world’s most studied social policies, providing work to an average of 88 million Indians annually over the past five years and generating nearly 48 billion days of work since its inception.
Now, critics say, that legacy is being undone.
The law’s architects — joined by opposition parties, leading international economists and much of India’s civil society — warn that a law passed in Parliament on Dec. 18 to replace the original act will in effect scrap its core promise. By off-loading costs to states that will struggle to pay, controlling funding caps that could reduce available jobs and centralizing control away from local officials, critics say a true guarantee of work will slip farther away.
In an open letter to the Indian government, prominent scholars, including economists Joseph Stiglitz and Thomas Piketty, called the move “a historic error” that undermines “the world’s most significant policy operationalizing a demand-driven, legal right to employment.”
But Prime Minister Narendra Modi’s government says the law’s reform is needed: “Far from weakening entitlements, the proposed framework addresses [its] deficiencies directly,” Agriculture Minister Shivraj Singh Chouhan, who introduced the bill, wrote in an op-ed for the Indian Express.
“The choice is not between reform and compassion,” he wrote, but “between a static entitlement that under-delivers and a modern framework that delivers with dignity.
Jobs, guaranteed
India saw a boom in economic growth in the 1990s, but it did little to alleviate rising unemployment and inequality. Grassroots movements began to recast welfare demands as rights — the right to food, information, education and work — which “addressed the state’s failures on the ground when party politics were not responding,” said Yamini Aiyar, a senior visiting fellow at Brown University who studies Indian state capacity and social policy.
That push culminated in 2005 with the National Rural Employment Guarantee Act, or NREGA, which guaranteed rural households up to 100 days of public work at minimum wage — or an unemployment allowance. Planning and implementation of projects such as road construction, water conservation and tree planting were decentralized to village councils and monitored by audits.
“The citizen became a claim-making, rights-bearing actor who could demand from the state rather than rely on its benevolence,” Aiyar said.
The program shared much of the same philosophy of the U.S. Works Progress Administration during the Great Depression, which put people to work as a form of asset creation, said Karthik Muralidharan, a professor of economics at the University of California at San Diego. But the program in India went further, establishing work as a right.
Muralidharan was a skeptic of the program until his research and hundreds of other empirical studies documented positive effects on household income, food security, women’s labor force participation, and broader economic efficiency and productivity. “It’s very rare to find a program that improves both equity and efficiency, wages and employment,” he said.
Designed as a safety net of last resort, the program was open to anyone willing to perform minimum-wage unskilled labor — a feature that proved critical during the coronavirus pandemic, when urban jobs collapsed and millions of migrants returned home.
“This was a lifeline,” said political activist Yogendra Yadav at a Delhi news conference organized by the NREGA Sangharsh Morcha, or Struggle for NREGA Movement, a national labor collective.
In 2009, the Congress-led government added Mohandas K. Gandhi’s name to the act, making the acronym MGNREGA. But the program’s underfunding, delayed wage payments and politicization had begun to fuel criticism even from supporters.
Direct cash transfers began to gain appeal as a competing vision for welfare, a shift accelerated under Modi’s party, from 2014 on. Public programs increasingly carried Modi’s image — some included food rations and coronavirus vaccination certificates.
Modi has looked down on projects under the program, but he vowed not to dismantle it. “I would never make that mistake because MGNREGA is a living testimony of your failures,” he told the opposition ranks in Parliament a decade ago, “that you had to send people to dig holes.”
Rewriting the rules
In mid-December, Parliament passed by voice vote a bill within three days of its introduction that experts say could transform the sweeping social program, as opposition lawmakers tore up copies of the legislation in protest. When members of NREGA Sangharsh Morcha sought permission to demonstrate in Delhi, police denied the request, citing a requirement of 10 days’ advance notice — an impossible task given the swift timeline.
“As national development advances, rural development programs require periodical revision to remain aligned with emerging needs and further aspirations,” the act reads.
It raises guaranteed work from 100 to 125 days, pauses employment during peak agricultural seasons to ease farm labor shortages, requires village project planning to integrate into national frameworks and mandates technology use.
Critics counter that the headline changes are a superficial layer atop a structural revamping. Central funding under the bill falls from 90 percent to 60 percent, shifting fiscal risk and responsibility for unemployment payments to states that are already stretched thin. The seasonal pauses and funding caps appear likely to cancel out any benefits of a higher day guarantee, particularly since most workers did not receive the full 100 days under the original law anyway, they argue.
“The redesign is changing it from a right to a program which clearly weakens labor’s hand,” Muralidharan said. “The real problem has been implementation, not the program’s design.”
The new controls given to the central government are an end to the law’s demand-driven character and “defeats the purpose of a guarantee,” said development economist Jean Dreze, one of the law’s original architects. “The teeth have been removed.”
Jayati Ghosh, economics professor at the University of Massachusetts Amherst, said at the news conference that the law “accentuates extreme and partisan centralization.”
Chouhan, the agriculture minister, has disputed these claims, arguing that states will create their own programs within the law’s mandates, preserving “cooperative federalism.”
The law also mandates biometric authentication for workers, geotagging of worksites and real-time monitoring dashboards — systems that research by the organization LibTech found coincided with more than 100 million worker deletions between 2020 and 2024. Field studies found that officials would delete workers from the program when technological challenges were too complicated to resolve.
By embedding these technologies directly into law, said Chakradhar Buddha, a LibTech senior researcher, the government has made them far harder to challenge. “This is a core, fundamental shift,” he said.
“This decision will have very negative consequences on India’s poorest households,” Piketty, a left-leaning French economist focused on inequality, wrote in an email to The Washington Post. “This reflects once again the fact that this government cares more about [its] top business friends than about the poor and middle classes of India.”
India is grappling with unemployment. The rural poor are retreating to agricultural work. Nearly half of India’s population works in agriculture — a figure that crept up during the pandemic and has held steady in the years since.
The pauses under the new policy during agricultural seasons will stop workers from being able to bargain for higher wages because overall work options will reduce, critics note. “You have a government that, far from providing employment, is trying to plug it,” Indian political scientist Zoya Hasan said.
Richer countries have considered basic unemployment allowances to tackle rising joblessness. But “an employment guarantee is a better answer,” Dreze argues, “because it gives people dignity and a purpose.”
For Shravani Devi, a resident of Rajasthan’s Beawar district, the debate is personal. She has participated in the work program since 2006 and fought village officials repeatedly to secure her full entitlement. When her husband suffered a road accident, the work allowed her to keep her children in school.
“Who did they ask before changing the law?” she said at the Delhi news conference. “Modi will have to listen to us. We won’t let them finish off NREGA — even if we have to fight and struggle.”
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