Gainful Employment

The problem with the high GDP growth rates that have been registered by the Indian economy over the past few years is that they have been achieved with increases in productivity in manufacturing and services sectors through the introduction of labour saving technologies. Consequently there has been very little addition to job opportunities in the organised industrial and service sectors. Instead the organised sector has tended to outsource its non-core operations to the unorganised sector leading to higher casualisation and lesser wages for people working in these sectors. Simultaneously due to the reduced investment and subsidies in the agricultural sector productivity has nose-dived there leading to a greater amount of disguised unemployment in that sector. While there is great demand for labour in agriculture for short durations during weeding and harvesting in most other periods there is a tremendous slack. Under the circumstances it is not surprising that seasonal migration has become an important aspect of the Indian economy with the high investment areas drawing in huge amounts of labour. For instance the tremendous investments being made in Gujarat have drawn in the Bhils from Alirajpur, Jhabua, Ratlam, Panchmahals, Dahod,Banswara, Dungarpur and Udaipur districts in large numbers. In fact the Bhil labourers earn a considerable amount of money that has helped them to free themselves from the clutches of moneylenders.
However, all this does not make for a feasible long term growth strategy. As has been shown by the collapse of the financial sector in the USA an export led high growth strategy is bound to backfire if there is not enough effective demand in the domestic economy. Unless the agricultural sector is revived and made to generate employment on a sustainable basis there is no way in which growth can be sustained. Ideally the Bhils should be able to work on their own farms to make them more sustainable units of agricultural production. This requires a radical reorientation of agriculture away from chemical and water intensive farming to organic farming that relies more on natural inputs and conserved soil moisture. This can be achieved by implementing the NREGA in a proper manner. At present there is no vision behind the implementation and there is one major bottleneck. This is that before payments can be made to the labourers the work done by them has to be physically assessed by a sub-engineer. There are insufficient number of sub-engineers and so this gets delayed and the labourers have to wait for months together to get paid. Therefore there is a need for doing some serious awareness generation and technical capacity building work with the people to enable them to devise good and sustainable agricultural regeneration plans and do effective social audit of the work done which will obviate the need for evaluation by sub-engineers. At the same time there is a need to spread awareness among the people in the cities to consume organic foods for their own health and for the health of the economy. In the interim there will be a need to subsidise the transition to organic cultivation and consumption through taxes but in a short time this will be obviated as the organic agricultural economy takes root. Tremendous resources were spent on making the farmers of this country switch to chemical agriculture and it paid off in the short run with higher productivity. However, that has now tapered off and so once again tremendous resources will have to be extended to get the farmers back on to a more sustainable growth path. This will permanently solve the problem of disguised unemployment in agriculture combined with lack of effective domestic demand in the Indian economy. So while the industrial and service sectors continue to grow without contributing significantly to employment due to the compulsions of the new technologies coming in the agricultural sector can provide the cushion by adopting a sustainable and labour intensive growth path. While the industrial growth in the early years after independence was cross-subsidised by disproportionately high indirect taxes garnered from the agricultural poor the return to sustainable agriculture and higher employment in that sector has to be cross-subsidised by taxing the industrial and service sectors more than they are being at present.