ISSN (Print) - 0012-9976 | ISSN (Online) - 2349-8846

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Income and Livelihood Promotion through Individual Assets under MGNREGA

The potentialities of individual assets, created under category B of Schedule I of the Mahatma Gandhi National Rural Employment Guarantee Act, for enhancing income of rural households and increasing productivity of land and agriculture are examined. The beneficiaries of individual assets gained, through the creation of new sources of livelihoods, additional utility of their existing assets and a rise in their income levels. The community also gained by an increase in food security through the enhanced productivity of land and agriculture, mainly through increase in crop acreage, yields per acre, and crop diversification. However, a proactive selection of landless households and diversification of individual assets is required to make the benefits of assets creation inclusive.


[An article based on the preliminary findings of this study was published as “Reengineering MGNREGS for Doubling of Farmers’ Income” in the Indian Express on 13 April 2018.]
The authors are grateful to the National Institute of Rural Development and Panchyat Raj, Hyderabad, and the Ministry of Rural Development for their support in conducting this study. They express their sincere thanks to the anonymous reviewer for valuable suggestions. The views expressed in this paper are, however, entirely of the authors.

Paragraph 4 of Schedule 1 of the Mahatma Gandhi Nati­onal Rural Employment Guarantee Act (MGNREGA), 2005 divides permissible works under the scheme (MGNREGs) into four categories, namely A, B, C and D. Category A provides for public works relating to natural resource management, mostly water conservation, watershed management, micro and minor irrigation, renovation of traditional waterbodies, land development in common land and afforestation. Category B provides for community or individual assets for the most vulnerable households.1 These are Scheduled Castes (SCs), Scheduled Tribes (STs), nomadic tribes, denotified tribes, below the poverty line (BPL) families, women-headed households, physically handicapped-headed households, beneficiaries of land reforms and the Pradhan Mantri Awas Yojana (PMAY), and traditional forest dwellers as listed in the Scheduled Tribes and Other Traditional Forest Dwellers (Recognition of Forest Rights) Act, 2006. Small and marginal farmers, as defined in the Agricultural Debt Waiver and Debt Relief Scheme, 2008 are also eligible for the benefits of the category B assets, but only after exhausting the list of above-mentioned eligible beneficiaries. Category C makes provision for common infrastructure for the National Rural Livelihood Mission–compliant self-help groups (SHGs) that promote agricultural productivity by creating durable infrastructure for bio-fertilisers, warehouses for post-harvest storage and common work sheds for livelihood activities of SHGs. Category D provides for rural infrastructure like all-weather roads, rural sanitation-related works like individual household latrines, school toilets, anganwadi centre toilets, playfields, compound walls for government schools, construction of gram panchayat buildings, etc.

It seems that the National Democratic Alliance (NDA)-II government had prioritised creation of income-generating individual assets under category B of Schedule 1 of the act.2 In sync with this priority, the government through an amendment dated 21 July 2014, made a provision in paragraph 4(2) of Schedule 1 of the act, thereby providing for 60% of the works in terms of cost to be undertaken for the creation of productive assets, directly linked to agriculture and allied activities through the development of land, water and trees.3 As per the MGNREGS Master Circular for the financial year 2018–19, there are 260 identified permissible works or activities (MoRD 2018). Out of these, 164 are related to agriculture and allied activities. Apropos the provisions, in 2017–18, the cost of works related to agriculture and allied ­activites constituted 67.8% of the toal expenditure incurred under the MGNREGS.

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Updated On : 22nd Jan, 2022
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