Page 89 - DECO502_INDIAN_ECONOMIC_POLICY_ENGLISH

Unit 8: Unemployment in India: Concept, Causes and Government Policies

The programme was funded by the Central Government on 100% basis. Resources were allocated to Notes
the States/Union Territories on the basis of the prescribed criteria giving 50% of weightage to number
of agricultural labourers, marginal farmers and marginal workers and 50% weightage to incidence of
poverty. Wages were paid to the workers under the Schedule of employment in the Minimum Wages
Act. Part of the wages were required to be paid in the form of subsidized foodgrains. It was also
stipulated that the wage component on a project should not be less than 50% of the total expenditure
on the project. The programme included projects of social forestry, Indira Awaas Yojana and Million
Wells Scheme.
The progress of RLEGP during the Seventh Plan (1985-86 to 1988-89) revealed that during the first
four years, a sum of ` 2,412 crores was utilized and this helped to generate employment to the tune of
1,154 million mandays.
As a result of the RLEGP, social forestry programme 5.2 lakh hectares of land was covered and 533
million plants were planted during the 3-year period. Besides this, 4.27 lakh houses at a cost of
` 425.5 crores were constructed upto Dec. 1988. The cost per dwelling unit worked out at ` 9,954.
The Government decided to merge NREP and RLEGP. The merger was based on the premise that the
objectives and implementation in the field of these two programmes were by and large similar. But it
may be pointed out that merger of NREP and RLEGP is merely tinkering with the problem. A much
more serious consideration should be given to develop a much tighter administration of rural
employment scheme to eliminate malpractices so that real beneficiaries can be helped to cross the
poverty line. Improving effectivity of implementation is the crux of the matter and not administrative
reorganisation.
IRDP, NREP, Rural Poverty—an Employment

A multiplicity of agencies have been carrying on the task of providing rural employment. They
included : Employment Guarantee Schemes, Food for Work Programme, Small Farmers Development
Agency (SFDA), Marginal Farmers and Agricultural Labourers (MFAL), Drought Prone Area
Programme (DPAP) and Desert Development Programme (DDP), Command Area Development
Programme (CADP), etc. The Sixth Plan (1980-85) proposed that “such multiplicity of programmes
for the rural poor operated through a multiplicity of agencies should be ended and replaced by one
single integrated programme operative throughout the country.” This programme was named as the
Integrated Rural Development Programme (IRDP).
Philosophy behind the IRDP Programme
A large body of economic experts have shown in their studies that whereas economic growth may be
able to raise per capita incomes in developing countries, it may not be accompanied by a reduction of
poverty as well as elimination of unemployment and under-employment. Rather the process of
economic growth in third world countries, India being no exception, has benefitted relatively
developed areas and better-off people. In other words, the percolation of benefits of economic growth
to backward areas and the poor people have not taken place.
To remedy this situation, it was thought necessary that a direct attack on poverty should be made.
This necessitated progammes for alleviating rural poverty by endowing the poor with productive
assets or skills so that they can employ themselves usefully to earn greater incomes and thus cross
the poverty line. To achieve this objective, the Sixth Plan conceived of two important programmes—
IRDP and NREP. The basic strategy was to promote self-employment of the poor households through
IRDP so that with the transfer of productive assets, they may earn incomes that help them to cross the
poverty level. The NREP (National Rural Employment Programme) was to provide wage employment
to fill in the periods of seasonal and sporadic underemployment. It was also intended to enlarge
absorptive capacity of labour in rural areas in non-agricultural occupations by creating infrastructure—
social and economic—which help to increase the productive capacity of the economy.
Targets and Achievements
The IRDP was initiated on October 2, 1980 in all the 5,011 blocks in the country. During the 5-year
period (1980-85) in each block 600 poor families were to be assisted. In this way, a total of 15 million

LOVELY PROFESSIONAL UNIVERSITY 83