GOVERNMENT INTERVENTION AND LABOR PROBLEM IN AGRICULTURE

The Government Policy makers are prolific; they have contributed hugely to the Unemployment problem through compensating them generously through the various Unemployment schemes. Very much like the Developed countries' notion that the way to expand trade and specially their agricultural export is to raise the internal subsidy levels, the Indian Government suffers from the delusion that giving Unemployment benefits is the proper solution to resolve the level of Poverty and Unemployment. But, these Unemployment benefits are just misnomers...........they do nothing to benefit either the recipient or the society......so under all circumstances there are huge loss that the Society as a whole bears.

This is a story of how a labour market problem, under the effects of Government Intervention may grow into a cause of a great many problem............

The major problem faced by the rural land holder is lack of labour.........we are now talking of Progressive Landholders, the reason that they hold to be responsible for this situation is the numerous Government subsidies and benefits that the unemployed receive nowadays.

The Government dreams of rubbing off unemployed giving them a 100 days' work.

I would like to elaborate upon the points that the farmers themselves raised at the time we had had an opportunity to talk to them personally. These are the accounts:

1. There is the 100 days' work scheme (the NREGA), as the GOI and MORD puts it:"The National Rural Employment Guarantee Act (NREGA) passed by Parliament in August 2005 is a legislation that guarantees wage employment on public works to any adult who is willing to do unskilled manual work, subject to a limit of 100 days per household per financial year. Failing this, the person will be provided with a daily unemployment allowance (one third to one half of the minimum wage). If employment or compensation is not given, the concerned person has the right to seek judicial intervention to secure his/her rights.  This is not a targeted programme but one based on the principle of self-selection." The wage daily wage paid is Rs. 100- Rs. 150, the scheme applying to one member of each household.
2. Schooling has been made free at the primary level at least, even the mid-day meal provides sufficiently to the school-going member.
3. Additionally, there is allowance for 45 kgs for free ration per month.

Together we see that earning, food, education has been funded adequately by the government, so there exists minimal incentive to further attempt to find any productive employment or job, their contribution to society is nil.....rather their net contribution to the society is negative.

But, what are the repercussion effects in the rural sector due to these schemes?

The large landowners are unable to gather labour to sufficiently give the effort to lift up the agricultural operations in any season..........the per hectare production/productivity suffers due to unavailability of labour. Why would someone wish to work when there is neither the need of it nor any incentive, since our agricultural market is infested with corruption, from the ranks of the "Bichouriya"- the middlemen, to the Government Officials, to the market where they are to sell their produce, and hence it has become a non-profitable occupation?

The large farmers work on the land themselves, often due to shortage of labour they fail to reap all the harvest and their efforts just get washed away and wasted, they do not pay themselves the wage that the labourer was due to receive, and more over they are forced to sell the produce at a rate that is half of the market rate......neither do they have an alternative, since otherwise their produce would rot in the cold storage and the complete cost would remain unrecovered. So, unlike  the businessmen who are drawn to their enterprise by virtue of the profits they receive, the Farmers are forced by the market situation to drag on being a farmer, they have little else to do, moreover the labour market is now cradled by the Government to further aggravate the problem of the farmers.

This slowly leads the next generation farmers to search for newer avenues of earning .......beyond the farms, the labour market has by ten nested well under the shades of the free benefits, and more people has moved away from their lands, or has sold them to someone interested to buy it, or rented it out for some agricultural purpose, but they themselves revert from the responsibilities and denial of their predecessor.

This ultimately shall lead to shortage of food supply, high demand for agricultural workers..........so high cost of farming, and hence a spiral of inflationary trends.

To visualise this situation there is no need for expertise, it is the indifference and myopia of the Policy-makers that can be held responsible for this excruciating situation. Only a sensitive and practical Policy-making body would be able to mend these circumstances.