How big projects can pull our villages out of poverty
Everyone duly noted the depressing data about continuing poverty and deprivation in India’s villages: in nearly 75% of households, the highest earner has a monthly income of less than Rs 5,000; just 5% of households have someone working in a salaried government job and less than 4% have someone in a private sector job; and for more than half of village households, the main source of income comes not from farming but manual labour.Updated: Jul 13, 2015 01:58 IST
India’s fickle news media are often quick to shift the focus from one big event to another — or, to make that more contemporary, from one big scam to another. So it wasn’t unusual that when the government released India’s first socio-economic caste census of its villages (where three out of four Indians live) media interest was ephemeral. Everyone duly noted the depressing data about continuing poverty and deprivation in India’s villages: in nearly 75% of households, the highest earner has a monthly income of less than Rs 5,000; just 5% of households have someone working in a salaried government job and less than 4% have someone in a private sector job; and for more than half of village households, the main source of income comes not from farming but manual labour. But a week after those numbers were released they are all but forgotten. That is a pity. Because at the heart of the census (based on a 2011 survey) is something that requires more urgent attention than most other things: the importance of creating jobs.
In almost 75% of households in India, the highest earner has a monthly income of less than Rs 5,000.
The new census starkly shows that lack of jobs is rural India’s main bane but the situation is not much better in urban areas. Every year, India’s higher education system spews out 350,000 engineers and 2.5 million university graduates into the workforce but at any given time, nearly five million Indian graduates remain unemployed. And that’s only the 7% of Indians aged 18-25 who can go to college. For those who cannot, their fate is worse, and, as the census numbers show, especially so in rural India, where the main income for 51% of the 180 million village households doesn’t come from proper jobs but from typically low-paying, often temporary, manual labour.
The worrisome fact is that India has not been generating enough jobs. In 12 months till December 2014, industries such as textiles, metals, auto, IT/BPO and transport, added 421,000 jobs — a number that would be pretty impressive in many countries but not in one that is as young and populous as India, where 15 million job seekers are added every year or 1.25 million every month.
The problem of joblessness has grimmer consequences in India’s villages. Millions of India’s villagers travel to cities in search of jobs. Many of them are low-skilled or unskilled so the employment options are mostly in activities such as construction and road building, where the biggest projects are government-sponsored. The problem is such projects have slowed down: four out of 10 central infrastructure projects costing Rs 100 crore or more are running late; and the government’s data says of a total of 738 projects (public, private or other), as many as 315 are stuck. This may be why there are not as many jobs, low-skilled but paying, available for those who want to move from villages to earn a living.
The country’s first Socio Economic and Caste Census has been embroiled in a controversy. (Waseem Andrabi/HT File Photo)
It may also be why those who could have moved out of their villages by getting such jobs could be choosing to stay put. And, more seriously, why migrants from villages who can no longer get jobs in urban areas could be choosing to go back home. There is little data on how much rural to urban migration is happening and even less that can establish the reverse of that but there are other pointers. The rate of growth of average daily wages on farms has slowed down quite sharply in recent months: in October 2014, such wages grew 17% but by April 2015, the growth had slumped to less than 3%. This could mean more people than what is needed are available for low-skilled work such as ploughing or tilling on farms — not a good sign.
Generating jobs that can pull India’s villages out of poverty will be vital for productive economic growth. In the long term that would mean skill upgrades for India’s teeming workforce. That will take time. In the more urgent short term, the government would need to kickstart projects that involve a large-scale, albeit low-skilled, workforce. Think roads, ports and power projects — all of which need construction workers who are available in large numbers in India’s impoverished villages.
Sanjoy Narayan is the editor-in-chief of Hindustan Times. He tweets as @sanjoynarayan