More than Rs 8,000 crore of unpaid wages are due from the rural job guarantee scheme MGNREGA for the 2015-16 financial year. A further Rs 3,686 crore worth of material for the same financial year has yet to be paid.
This means that states will spend about Rs 12 crore out of this year's budget of Rs 38,500 crore, aimed to provide 100 days' work for people in rural India, making up for last year's dues.
"States will be left with only Rs 26,500 crore for the entire year," said Nikhil Dey of the NGO Majdoor Kisan Shakti Sangathan.
West Bengal owes its MGNREGA workers Rs 2,400 crore, Uttar Pradesh Rs 663 crore, Assam Rs 487 crore, Madhya Pradesh Rs 480 crore and Bihar Rs 454 crore, according to the Hindustan Times.
The reduced budget for this year could hit really hard, because drought will most likely see more people in rural India look for work, said Dey.
Dey added that rural welfare campaigners had asked for a minimum of Rs 50,000 crore for this year, anticipating the effect of the drought.
Last year, the MGNREGA budget was Rs 34,699 crore, and the entire allocation was exhausted by December.