States to benefit ₹17,000 crore from ‘G RAM G’:UP, Maharashtra and Bihar could be the biggest gainers; centre–state funding ratio will be 60:40

The “Viksit Bharat Guarantee for Employment and Livelihood Mission” (VB-G RAM G), a rural employment guarantee scheme that replaces the Mahatma Gandhi National Rural Employment Guarantee Act (MGNREGA), will grant access to around ₹17,000 crore to the states collectively, uplifting the economic condition of the people, according to a State Bank of India (SBI) report. “G RAM G” Mission To Create More Rural Jobs Each rural family will get guaranteed 125 days of work in a year, up from the earlier 100 days. Section 22 of the law specifies that the centre and the states will fund the scheme jointly in 60:40 ratios. For the northeastern states, hill states and the union territories such as Uttarakhand, Himachal Pradesh and Jammu and Kashmir, the central government will bear 90% of the cost. Furthermore, the Section 6 of the new law stipulates that state governments can regulate the work for a maximum of 60 days yearly during the busy sowing and harvesting seasons. Under the MGNREGA law, the rural unskilled people received 100 days of guaranteed employment as part of the socio-economic welfare initiative. Here are its salient features. “G-RAM-G” law to follow 60:40 funding ratio to reduce burden on states The broad funding obligation between the center and the state governments will be in the 60:40 ratios. The SBI report has sought to remove concerns that it will lead to additional financial burden to the states, instead stressing, that it will benefit them. However, there is one exception to the rule. The northeastern states, the union territories and the Himalayan states will receive up to 90% in central funding. UP, Maharashtra and Bihar to benefit the most The SBI report has compared the allocations under the new law with MGNREGA data covering over the past seven years (FY19-FY25). According to the report: States will not need to take loans The report dismisses claims that states will be forced to take loans to fund the scheme. The SBI report said that the new law specifies that funding will be based on “equity and efficiency”, ensuring better funding for both developed and backward states. States have opportunity to increase their share The SBI report also suggests that state governments can further improve the results of this mission by effectively utilizing their 40% contribution. This will not only increase employment but also accelerate rural infrastructure development. ​