Siddaramaiah urges PM Modi to suspend VB-G RamG Act, flags 'erosion' of employment rights
Bengaluru (PTI): Karnataka Chief Minister Siddaramaiah on Tuesday urged Prime Minister Narendra Modi to suspend the implementation of the Viksit Bharat–Guarantee for Rozgar and Ajeevika Mission (Gramin) (VB-G RamG) Act, warning that the new law fundamentally weakens the employment guarantee framework and undermines cooperative federalism.
In a detailed letter to Modi on Tuesday, the Chief Minister expressed serious concern over the repeal of the Mahatma Gandhi National Rural Employment Guarantee Act (MGNREGA), stating that the new legislation risks dismantling a demand-driven, rights-based entitlement that has served as a critical livelihood safety net for rural households.
“I wish to draw your kind attention to the Viksit Bharat-Guarantee for Rozgar and Ajeevika Mission (Gramin) (VB-G RamG) Act and the consequent repeal of the National Rural Employment Guarantee Act,” Siddaramaiah wrote, cautioning that the shift could defeat the very intent of an employment guarantee law.
“At the outset, I submit that the new law risks defeating the very intent of the original employment guarantee, a demand-driven, rights-based entitlement,” the Chief Minister said, while acknowledging that although the new Act increases the promised guarantee from 100 to 125 days, it does not provide assured planning or central funding to back that promise.
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Siddaramaiah pointed out that the VB-G RamG Act caps the union government’s financial responsibility to a ‘normative allocation’ for notified areas of each state, with the Centre contributing only 60 per cent of that allocation in most states.
“As a result, the so-called legal guarantee of 125 days is not absolute,” he said, adding that it is constrained by a centrally determined funding ceiling, leaving many gram panchayats without funds despite genuine demand.
The Chief Minister also objected to provisions that allow the Centre to determine state-wise normative allocations annually based on objective parameters that are neither embedded in the legislation nor fixed through consultation.
He warned that such parameters could be altered unilaterally and would fail to reflect diverse local needs across and within states.
“In effect, a demand-driven regime is being converted into a supply-driven, top-down system,” Siddaramaiah wrote, pointing out that the new framework runs contrary to the participatory approach under MGNREGA, where labour budgets originate at the gram panchayat level and allocations follow village-level demand rather than central convergence plans.
He stated that this diluted the constitutional vision of decentralisation under the 73rd Amendment.
Raising alarm over the revised funding pattern, Siddaramaiah said under MGNREGA, mainstream states followed a 90:10 Centre-State sharing arrangement, while the new Act shifts this to 60:40.
This, he said, converted a statutory guarantee into “a run-of-the-mill scheme” and imposed a heavy burden on state finances already strained due to GST compensation issues and inequitable financial devolution.
According to him, the provision making states fully liable for expenditure beyond their normative allocation could leave them facing 100 per cent financial responsibility for excess demand.
In such a scenario, he said, the guarantee would depend not on demand but on a state’s fiscal capacity, rendering the entitlement unenforceable.
Siddaramaiah also criticised the requirement to pre-notify a 60-day no-work period during peak sowing and harvesting seasons.
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While acknowledging increased agricultural activity during those months, he said a blanket restriction would hurt vulnerable groups who may not find adequate farm work.
He cautioned that this could reduce employment opportunities, suppress wages and worsen livelihood insecurity, leading to increased distress migration and reduced participation of women.
Summing up the changes, Siddaramaiah wrote that the new framework shifts the intent “from ‘right to work’ to ‘work only if permitted’,” and from year-round rural employment to restricted periods and locations.
He also voiced concern that increased reliance on technology and contractor-led projects could exclude the poorest, particularly Dalit and Adivasi communities.
Terming the implementation "arbitrary and hurried", the CM said the Act violates constitutional provisions requiring consultation with states and weakens the foundations of cooperative federalism.
Siddaramaiah also opposed the removal of Mahatma Gandhi’s name from the law, calling it a historic, globally acclaimed rights-based legislation rooted in Gram Swaraj and Antyodaya.
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India surpasses Japan to become world's 4th largest economy, says govt
New Delhi (PTI): India has surpassed Japan to become the world's fourth-largest economy with a size of USD 4.18 trillion, and is poised to overtake Germany to become the third-largest by 2030, the government has said.
With continuing good growth numbers, India is also the world's fastest-growing major economy.
India's real GDP grew 8.2 per cent in the second quarter of 2025-26, up from 7.8 per cent in the first quarter and 7.4 per cent in the fourth quarter of the last fiscal.
"With GDP valued at USD 4.18 trillion, India has surpassed Japan to become the world's fourth-largest economy, and is poised to displace Germany from the third rank in the next 2.5 to 3 years with a projected GDP of USD 7.3 trillion by 2030," according to a government release providing a snapshot of reforms in 2025.
The US is the world's largest economy, and China occupies the second spot.
The growth momentum further surprised on the upside, with GDP expanding to a six-quarter high in Q2 of 2025-26, reflecting India's resilience amid persistent global trade uncertainties, it said.
Domestic drivers, led by robust private consumption, played a central role in supporting this expansion.
The release further said international agencies have echoed this optimism and cited projections made by various entities.
The World Bank has projected a 6.5 per cent growth in 2026; Moody's expects India to remain the fastest-growing G20 economy with a growth of 6.4 per cent in 2026 and 6.5 per cent in 2027.
The IMF has raised its projections to 6.6 per cent for 2025 and 6.2 per cent for 2026; the OECD forecasts 6.7 per cent growth in 2025 and 6.2 per cent in 2026.
Also, S&P anticipates a growth of 6.5 per cent in the current fiscal and 6.7 per cent in the next; the Asian Development Bank has lifted its 2025 forecast to 7.2 per cent; and Fitch has raised its FY26 projection to 7.4 per cent on stronger consumer demand.
"India is among the world's fastest-growing major economies and is well-positioned to sustain this momentum. With the ambition of attaining high middle-income status by 2047- the centenary year of its independence, the country is building on strong foundations of economic growth, structural reforms, and social progress," the government said.
The release also highlighted that inflation remains below the lower tolerance threshold, unemployment is on a declining trajectory, and export performance continues to improve.
Furthermore, financial conditions have stayed benign, with strong credit flows to the commercial sector, while demand conditions remain firm, supported by a further strengthening of urban consumption.
