Showing posts with label migrant workers. Show all posts
Showing posts with label migrant workers. Show all posts

Thursday, February 4, 2021

Take jobs to workers

 In past couple of years some state governments have announced reservation for local residents in private sector jobs. Some other states are also considering to implement similar provisions. Given that the word “reservation” itself is not liked by a large section of Indian population due to legacy reasons, this trend has evoked strong reactions from the businesses and job seekers from other state who fear losing out to the local population in these states.

Many issues like, Right to Equality, likely productivity loss due to lack of competent people, likely higher wage cost due to limited supply of qualified people within particular state, etc., have been raised by the concerned people. Concerns have been raised about flight of businesses to other states, further worsening the regional inequalities.

In my view, it is a very good idea, of implemented pragmatically. If the state governments work with the private entrepreneurs to develop the education, skill and training ecosystem in their respective states and provide fiscal incentives to businesses for giving preference to local people for their incremental job requirements, this stipulation could materially promote the regional equality and employability of youth. This shall also reduce the cost for businesses as they could move away from expensive concentrations like NCR, Bengaluru, Mumbai, Chennai, Hyderabad and hire good people at relatively lower cost. The investments being made in transportation infrastructure, Bullet Train, Economic Corridors, Dedicated Freight Corridors, Regional Airports etc. shall support efficient relocation of businesses to hinterlands.



However, if this is implemented as political opportunism, it may prove to be seriously counterproductive. In this context it is important to note that there are huge disparities in the rate of unemployment across various states. This disparity cannot be bridged without the active participation of private sector. Regional employment opportunities are also important from the view point of civic pressure on large cities due to migrant workers.

Tuesday, July 7, 2020

Trip to rural India

Some corporate leaders have repeatedly highlighted that the rural economy is doing much better than the urban economy in India. In their view, the economic recovery from COVID-19 led slowdown will be led by the rural demand. The rise in sales of tractors, passenger vehicles and consumer staples in rural sector has been cited as clear signs of rural recovery. The data of bumper Rabi crop production and highest ever Kharif sowing is being widely used to support the faster rural recovery argument.
To make an assessment, we visited some rural areas of UP and Rajasthan over last weekend. After visiting over 50 rural clusters and speaking with many people (traders, local administrators, farmers, laborers, etc.) our impression about the situation as follows:
(a)   The staple Rabi crop of cereals and sugar cane has been good and prices have been supportive in these two states. However, the fruit and vegetable crops have not been good and caused losses to large number of farmers. The rise in sowing area for Kharif crop is mainly due to return of migrant laborers and good rains in past three months.
(b)   The government work under MNREGA, acceleration in construction of road projects, shortage of farm and construction labor has resulted in created significant demand for tractors and farm equipments. The trend may continue for few more years.
(c)    Due to paucity of labor, many farmers in UP and Punjab have used direct planting for sowing paddy this time. If the outcome is satisfactory, the labor requirement for paddy cultivation may fall sustainably by 75-80%. The government shall be supportive of this technique as this method is significantly less water intensive. The demand for rice planters and harvesters may rise multifold in coming years at the expense of migrant laborers. This essentially means that while the large farmers will gain materially (higher productivity, lower cost and better prices), the poor laborers will struggle to find employment at the prevailing rates (Rs600-900/day). This augurs well for sale of cars, SUVS, tractors, farm equipments, high quality seeds, premium liquor, etc., for staples etc it may not be a good news.
(d)   The migrant laborers are facing a variety of problems in their villages. There is significant rise in family disputes over house and land properties. The children who were born and raised in large cities are finding it difficult to adjust to village life, especially education. Many laborers are willing to come back to cities, but most of them are unlikely to bring their families along. This means persistent pressure on the village civic infrastructure for longer duration than earlier anticipated. Most laborers have outstanding dues to be settled in cities (Rent, DTH bill, Phone Bills, Grocery & Milk bills etc.) Almost none is in a position to pay. So it will be a fresh begining for most of these laborers - new place and may be new work also.
(e)    The government has provided decent money under various schemes. The food is available in plenty. The pre COVID-19 ration schemes (Rs 1/kg food grain) is functioning well to provide sufficient foodgrain for subsistence to the below poverty line (BPL) citizens.
(f)    The post COVID-19 free food distribution scheme (PMGKY) which is primarily targeted at the daily wage earners and poor who would have lost employment due to lockdown, has not been successful in meeting its target. It is feared that most of the ration released under this scheme may have been misappropriated by the scrupulous politicians and administrators. Many people indicated towards this possibility but were scared of speaking in specifics. Many people highlighted cases of sudden riches in their villages. New cars, tractors, motor cycles were cited as the signs of new riches.
Overall, we got a mixed feeling. It would be prudent to wait for the Kharif harvest to get a clearer picture.

Wednesday, May 20, 2020

ABCD of workers' migration



A popular saying is that "the true character of a person is often revealed in the times of crisis". The crisis tests intellect, common sense, resolve, grit, emotions, beliefs, etc. of people, besides highlighting their strengths, weaknesses and vulnerabilities. This applies mutatis mutandis to various organizations and systems also.
The present crisis, for example, has highlighted the strong character of the common people of India who are usually financially insecure (poor), less educated (or illiterate), religious (and superstitious), and oppressed. Often derided by the elite as dirty and non-compliant, these people have shown amazing resilience and grit. They have bore the brunt of economic consequences of the disease; faced cruel apathy of the administration & state (and in some cases employers also); have been most vulnerable to fatalities due to COVID-19 infections; and still managed to stay peaceful and non-violent.
Thousands of them received animal like treatment from administration and law enforcement agencies. Millions of them have walked hundreds of miles on highways and rail tracks, in scorching heat with infants, old, infirm and sick family members, sometimes going without food for hours. Some accidents causing death of many migrant workers have been reported on the media. However, many deaths due to heat, starvation, fatigue, infirmities and other curable diseases may go unreported.
The heart rending pictures of their painful journey back home have been widely shared and mourned in media. The rhetoric on TV channels and social media did spur the politicians into action, but unfortunately the action on the ground has been abysmally inadequate and apathetic.
Our team traveled to some highways and towns of UP, one of the largest destination of the migrant workers returning back, to assess the extent of the problems and its socio-economic impacts. I would like to share some key takeaways as follows:
1.    It is estimated that more than 10 million migrants may eventually return home to the states like UP, Bihar, Jharkhand, Chhattisgarh, MP, Odisha, West Bengal and Rajasthan. These workers are returning from relatively developed states of Maharashtra, Gujarat, Tamil Nadu, Andhra Pradesh, Karnataka, Punjab, Delhi and Haryana.
It is expected that once the lockdown is lifted fully, significantly larger number of migrant workers may seek to return home. Most of these workers are unskilled or semi skilled; though it may include sizable number of skilled workers also.
2.    The central and state governments appear to have completely ignored these workers in their planning for the lockdown. No thought was spared for their survival and sustenance in a prolonged lockdown scenario. This adequately highlights the pseudo feudal structure of our governance system (a key weakness) and absolute mediocrity of our administrative machinery (a key vulnerability). The Chief Minister of UP has emerged as most popular politicians insofar as handling of migrant workers is concerned. Even though he started a little late and is not supported ably by the administration and bureaucracy, he still has managed to convey the message that he cares.
3.    The innocent, helpless, scared, hungry and tired migrant workers have been treated worse than animals. Many states have treated them as if they were illegal intruders from some foreign country. This highlights that our economic and governance model may still be colonial in nature.
4.    A significant number of migrants on roads we spoke to confided in us that they were planning to return home since past few years, but were not able to muster enough courage. They believe that with so many government schemes operative, two square meals with dignity & freedom is not a problem in villages. They find it better than living in urban slums like insects.
5.    After speaking with over 900 migrant workers on road, we can say with some confidence that:
(i)    A large number of migrant workers returning home may not easily go back to their previous place of work. Many of them may in fact never leave their homes for work. There could be at least the following five consequences of this trend:
(a)   Businesses, especially construction and textile, may be forced to invest more in technology and automation. Household relying on domestic worker may also be forced to invest in home automation for household chores.
(b)   Many labor intensive businesses like textile may have to either relocate their manufacturing units in the areas where adequate number of local labor is available.
(c)   The pressure on civic infrastructure in large cities and railways may ease. The multibillion rupees remittance industry may be a key loser.
(d)   The home states of these workers may be incentivized/forced to invest in industrial infrastructure and seek private investments to create ample employment opportunities close to home. This may be a big fillip to the "self reliant" India mission. Agro processing is one industry that may see exponential investment and growth.
(e)   The regional imbalances in India may gradually bridge, if the home states seize this opportunity and develop a good industrial infrastructure.
(ii)   The Agony, sense of Betrayal, Confusion and Disillusionment (ABCD) is ideally a fertile ground for emergence of communist movements. Given the democratic communist parties in India are totally marginalized, the fear is that the violent Naxal movement may spread out of the forests of central India. A strong strategic initiative to prevent such eventuality must be taken immediately. The forthcoming election in Bihar may display some reflections of this fear. Watch out for that closely.
(iii)  The expectation from, and reliance on, the government's cash, food and fuel provisions shall rise materially, especially in the rural and semi urban areas. The fiscal pressures may remain elevated for many years to come.
(iv)   The pressure on civic and social infrastructure of villages and semi rural (or semi urban) areas shall rise significantly. Administration need to gear up for this well in advance, otherwise we may have garbage, filth, and disease everywhere.
(v)    The migrant workers returning home after spending many years in large cities are carrying an entirely different culture with them. On the positive side we may see improvement in religious and superstitious practices. However, on the other side, we may see many indulgences creeping in the simple village life style.