New Delhi, December 19, 2025 – In a move decried by opposition leaders and activists as a "structural sabotage" of rural India's lifeline, the Narendra Modi-led government has passed the Viksit Bharat Guarantee for Rozgar and Ajeevika Mission (Gramin) Bill, 2025 (VB-G RAM G), effectively repealing the two-decade-old Mahatma Gandhi National Rural Employment Guarantee Act (MGNREGA). While the Centre touts the overhaul as a step toward "Ram Rajya" in villages and an expansion to 125 guaranteed workdays per household, detractors argue it's a thinly veiled ploy to offload financial burdens onto cash-strapped states, eroding workers' rights under the guise of reform.
The VB-G RAM G Bill cleared both houses of Parliament amid chaotic scenes in the Lok Sabha, where opposition MPs tore papers and stormed the well of the House in protest. The Rajya Sabha followed suit late Thursday, passing the legislation by voice vote despite vociferous objections. The bill replaces MGNREGA – a demand-driven scheme that guaranteed 100 days of unskilled manual labor to rural households, with wages fully funded by the Centre – with a fixed-allocation model that shifts 40% of wage costs to states for most regions, up from the previous 10% state share on materials alone.
Under the new framework, the Central government will set "normative allocations" for each state based on prescribed parameters, capping funding and forcing states to foot the bill for any overruns or unemployment allowances if work isn't provided within 15 days. For northeastern and Himalayan states like Uttarakhand and Himachal Pradesh, the split remains 90:10 in favor of the Centre, but critics say this leaves poorer, opposition-ruled states like West Bengal and Kerala disproportionately exposed. The scheme will also pause for two months annually during the agricultural season, a provision absent in MGNREGA.
"This isn't reform; it's repeal and replace with a vengeance," fumed Congress leader Rahul Gandhi in a fiery X post, accusing the Modi government of "demolishing 20 years of MGNREGA in one day" to impose an "anti-village" burden on states. Gandhi, echoing a broader opposition chorus, vowed street protests from "Sadak to Sansad," highlighting how the shift from universal, rights-based access to a "notified" scheme – where only Centre-approved rural areas qualify – dilutes the legal entitlement to work.
The financial implications are stark. MGNREGA, enacted in 2005 under the UPA government, has employed over 15.5 crore workers – half of them women, predominantly from Scheduled Castes and Tribes – injecting trillions into rural economies and stabilizing wages during crises like the COVID-19 pandemic. Its demand-driven nature ensured the Centre responded to spikes in need, but VB-G RAM G's supply-side caps could leave millions underserved, with states – already reeling from GST revenue shortfalls and delayed central dues – forced to choose between funding jobs or essential services.
Nikhil Dey, co-founder of the Mazdoor Kisan Shakti Sangathan (MKSS) and a key architect of MGNREGA's social audits, told The Federal the changes represent a "fundamental betrayal." "The government could have simply amended MGNREGA to add 25 days without this repeal. Instead, they're extracting 40% from states to fund what should be a national right. This isn't Viksit Bharat; it's a fiscal heist on federalism."
International voices have amplified the alarm. An open letter from the Levy Economics Institute of Bard College, signed by global economists and policymakers, branded the repeal a "historic error" and "catastrophic" for India's rural poor, warning it could trigger mass unemployment and migration. "MGNREGA captured the world's attention for its innovative design," the letter states, likening the overhaul to "structural sabotage."
Even BJP allies are uneasy. TDP MP Kanakamedala Ravindra Kumar raised concerns in Parliament over the funding shift, questioning how states can sustain 40% contributions amid rising demands. The NREGA Sangharsh Morcha, a coalition of workers' groups, has called for nationwide strikes, rejecting the bill outright and demanding its withdrawal.
Government defenders counter that the revamp aligns with Prime Minister Modi's vision for a developed India by 2047, emphasizing the extra 25 workdays and integration with skill-building under "Guarantee for Rozgar and Ajeevika." Rural Development Minister Shivraj Singh Chouhan, tabling the bill, invoked Gandhian ideals, claiming it brings "Ram Rajya" to villages despite dropping "Mahatma Gandhi" from the name – a change that drew ire from Congress, which called it a "cosmetic rebranding to claim credit for a Congress legacy."
As the bill awaits presidential assent, protests brew in states like Rajasthan and Tamil Nadu, where MGNREGA jobs have been a bulwark against agrarian distress. Economists warn that without reversing the cost-sharing, the scheme risks becoming another underfunded promise, exacerbating India's jobs crisis ahead of 2026 polls. For millions of rural laborers, the question lingers: Is this progress, or a quiet dismantling of their hard-won rights?
By TCO News Desk. Additional reporting from parliamentary sources and activist networks.
For More News Updates Follow Us On Www.tconews.in
