Last Updated on June 30, 2026 10:39 pm by BIZNAMA NEWS
Andalib Akhter / New Delhi
The Narendra Modi government’s ambitious new rural employment programme, the VBGRMG Act, slated to replace the repealed MNREGA from July 1, has run into serious implementation hurdles, with as many as 14 states and Union Territories yet to complete mandatory formalities. Most strikingly, Prime Minister’s home state Gujarat and Union Rural Development Minister Shivraj Singh Chouhan’s home state Madhya Pradesh are among those that have not even issued the required notification for the scheme.
The new rural employment programme is scheduled for a formal national launch in Tirupati, Andhra Pradesh, on July 2. However, official data presented during the recent National Rural Development Conference at the Pusa Institute revealed that only 10 states are fully prepared for implementation.
The presentation showed that Gujarat has neither allocated funds under the required budget head nor opened the mandatory Reserve Bank of India account needed for the scheme. Although e-KYC verification in the state has reached 92.92 per cent, key financial and administrative requirements remain incomplete.
Madhya Pradesh, where the notification was expected to have been issued, has also failed to complete the process. Besides these two states, several BJP-ruled “double-engine” states, including Goa, Haryana, Maharashtra, Uttar Pradesh and Uttarakhand, are yet to complete crucial formalities. West Bengal has also not completed the process, with e-KYC standing at 79.86 per cent.
According to officials present at the conference, the data triggered an uncomfortable moment for Chouhan, who sought to downplay the issue. “I am not criticising any state. The work has not been completed yet, but it will be done soon. I am drawing the attention of the Rural Development Departments and the Chief Ministers,” he said.
Signalling a tougher stand, the Rural Development Minister announced that the Centre would withhold its share of funds until states deposited their matching contribution.
“I have now decided that the Central government will not release its share until the states contribute their portion for rural development,” Chouhan said.
Under the new funding pattern, states will bear 60 per cent of the expenditure while the Centre will contribute the remaining 40 per cent. For the remaining nine months of the current financial year, the Centre has earmarked ₹95,692.31 crore.