4 min readAug 26, 2026 04:28 PM IST First published on: Aug 26, 2026 at 04:28 PM ISTSeveral reports earlier this month noted a nearly 50 per cent drop in employment generated under the Viksit Bharat-Guarantee for Rozgar and Ajeevika Mission (Gramin), or the VB-G RAM-G. The scheme, launched last year as a successor to the two-decade-old Mahatma Gandhi National Rural Employment Guarantee Scheme, guarantees 125 days of rural wage employment, faster payments, and a technology-enabled delivery system built for a Viksit Bharat. It is the world’s largest public-works programme, backed by a budget of Rs 95,692 crore.The initial dip is too early to judge the scheme’s efficacy. The low numbers do pose a more important question, however: Is a wage-guarantee model, however well designed, the right instrument for rural India in 2026? Public employment guarantees have a long lineage, from Depression-era America to emperors who commissioned public works, including temples, to generate wages. The logic was straightforward: When private employment cannot absorb surplus labour — because industry is nascent, services are thin, and agriculture is overcrowded — the state must step in as an employer, providing wages through public works to prevent destitution. That logic held force in India when manufacturing was underdeveloped, and the services boom was an urban phenomenon. For rural households, a guaranteed unskilled wage job was often the only buffer between subsistence and distress.AdvertisementAlso Read | Between the myth and reality of VB-G RAM G, the tragic human costBut the India of 2026 is seeing sustained industrial expansion and a rapidly diversifying rural non-farm sector, and has a digital economy that has reached deeper into villages than most of us appreciate. Rural users now account for the majority of the country’s roughly 950 million active internet users. That connectivity has translated into consumption. Rural FMCG demand, for example, has been growing at roughly four times the rate of urban demand and is projected to reach $220 billion, a nearly tenfold rise from a decade ago. India’s rural markets are no longer passive recipients of government programmes.Nearly 64 per cent of India’s population and roughly two-thirds of its 378 million young people live in rural areas. Wages create livelihoods, not careers. The rural youth today are more educated, more connected, and more exposed to opportunity than any previous generation, but they are also less willing to queue for 125 days of manual wage labour on public works when better alternatives exist or could exist, especially closer to home. This arguably could be the real story behind VB-G RAM-G’s disappointing opening month.The question is no longer how to guarantee more days of wage labour, but how to create genuine, durable employment in sectors that already sit close to rural India’s comparative advantage. Sectors that convert local resources, local produce and local labour into local livelihoods while leveraging on the increasing global connectivity.AdvertisementFood processing is one example. The sector is projected to nearly double from its current size by 2030, built substantially on raw materials that rural India produces — milk, fruit, grain, spices. Renewable energy offers another example: India’s clean-energy targets could generate over 44 lakh jobs by 2030, with local, decentralised and labour-intensive production. Strengthening the ecosystem of rural manufacturing and service industries — not necessarily giant factories, but clusters of SMEs producing textiles, farm equipment, healthcare devices, renewable-energy components, construction materials and consumer goods — offers the kind of localised but large-scale rural employment a public-works scheme tries and often fails. Rural healthcare, agri-logistics, and small-scale manufacturing round out a portfolio of sectors where demand, resources and workforce already co-exist in rural India. Capital, skilling, and market linkages, not manual labour opportunities, are what Viksit Bharat demands.you may likeThis is not an argument for abandoning income support for India’s most vulnerable rural households. That safety net remains necessary, but it should no longer be the principal mechanism of rural employment policy.The next iteration of India’s rural employment architecture cannot simply focus on executing the old idea better. It must revise the idea itself. Wages are a short-term transaction. They buy a household immediate relief. Jobs provide the nation with a future workforce. Viksit Bharat will outgrow its need for wages as welfare; it will demand productive jobs.The writer is a senior agri industry advisor. Views are personal