New Delhi: The rural development ministry on Thursday decided to increase payments under MGNREGA, starting immediately. From now on, wages will be linked to the consumer price index for agricultural labour in each state. All in all, they’ll go up by 17-30% across the country. What’s more, the wage hikes will be effective starting from 01 January 2011.
Congress president Sonia Gandhi had written to the Prime Minister in November asking for MGNREGA payments to be increased to minimum wage levels. But the rural development ministry opposed the move, arguing that states would simply increase their minimum wages for farmers, forcing the centre to foot the bill.
MGNREGA is the UPA government’s most popular social scheme. Its minimum wage until now was Rs100 a day. The scheme guarantees 100 days of work each year for each rural household.
And the announcement of the wage hike came even as new food inflation figures showed a fifth straight week of acceleration. The food price index shot up 18.32% percent in the period to 25 December. In the previous week it stood at just 14.44%. Unexpected rains have spoiled some crops, sending prices of staples like onions skyrocketing. The high food inflation figures increase chances the RBI will hike rates in its next review, scheduled took place on 25 January
And here’s how Indian markets on Thursday. The Sensex plunged 116 points to close at 20,185. And the Nifty lost 32 to wind up at 6,048.