NREGA falters as rural India suffers acute unemployment crisis | india | Hindustan Times
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NREGA falters as rural India suffers acute unemployment crisis

At a projected 7.6% GDP, India is poised to be the world’s fastest growing economy. But that’s not good enough for Parkash Namdhari’s family of four from Jaluan in impoverished Bundelkhand.

india Updated: Feb 22, 2016 18:11 IST
Zia Haq
Farmers sow seeds in the paddy fields of Yeoor village in Thane. The decline of the NREGA scheme has compounded the acute misery in rural India, which is currently in the grips of its worst unemployment crisis in years.
Farmers sow seeds in the paddy fields of Yeoor village in Thane. The decline of the NREGA scheme has compounded the acute misery in rural India, which is currently in the grips of its worst unemployment crisis in years.(Praful Gangurde/ HT Photo)

At a projected 7.6% GDP, India is poised to be the world’s fastest growing economy. But that’s not good enough for Parkash Namdhari’s family of four from Jaluan in impoverished Bundelkhand.

Namdhari committed suicide six months ago because “nothing grows” on the family’s small parcel of land, said his widow Sahoni.

After three bad farming seasons, rural India is battling high levels of unemployment. Shrinking employment generation under the National Rural Employment Guarantee Scheme has only added to the crisis, data accessed by HT showed.

The NREGA programme, which completed 10 years this month, has been declining despite the government’s best efforts. According to figures recorded till January 26, less than 5% households completed 100 days – a benchmark for employment provided – in 2015-16.

A major reason could be delayed payments. Nearly half of all NREGA transactions worth Rs 7,200 crore until November were delayed. Of this, 62% payments saw delays of up to a month, 29% payments were held up for up to two months, and around 3% wages took over three months to reach workers.

Spurred by the crisis, the Modi government plans to turn around the NREGA scheme by linking it to skilled work. “The number of people who sought jobs in the last two quarters was the highest in comparison to corresponding quarters in the five previous years. Additional funds of Rs 5,000 crore are on their way,” an official said.

Still, the average employment days per household has only halved in the first four months of 2016. About 23 million households received work during this period, compared to nearly 50 million households a year ago – hinting that the scheme hasn’t worked well as a drought-relief measure.

The government had declared 50 additional days of employment in drought-notified districts. However, data showed that in the country’s nine worst drought-affected states, less than 10% households could complete 100 days of work (with the exception of Maharashtra, which clocked 12.2%). The NREGA law provides for statutory 100 days of work.

Agricultural exports have fallen by 23% last year. Rural wage hikes slowed from 22% in January 2014 to just over 3% in May 2015.

The lack of large state-fund opportunities to offset the loss in wages is a key reason behind the rural distress. While the Vajpayee government’s highway expansion project had come in handy during the 2002 drought, NREGA employment peaked in 2009 – when India suffered its worst drought in three decades.

“There is extreme distress. The Centre is focusing on long-term plans, but urgent relief through higher social-sector spending is the need of the hour,” said Sudhir Panwar, Lucknow University professor and Kisan Jagriti Manch head. All eyes are therefore on the Budget, slated for February 29.