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Posts Tagged ‘agricultural labour

Faster, higher, dearer – dizzying pace of food price rise in India

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The alarming tale of food prices, from 2004 January to 2013 August, that have squeezed the household budgets of cultivators and rural labourers.

The alarming tale of food prices, from 2004 January to 2013 August, that have squeezed the household budgets of cultivators and rural labourers.

For most of 2013, the central government broadcast, through important cabinet ministers and official statements, its worry about economic growth, that every effort must be made to steer India back towards a high economic growth rate. In the food and agriculture sector, that effort has led, in the last four to five years, to a gulf in growth rates between agriculture and the combination of processed and packaged foods and beverages (which the food retail industry is being arrayed around). While the agriculture sector (including fisheries and livestock) has been growing at or just above 4% a year for the last several years, the processed foods and beverages industry has been growing at around 15% a year.

The effects of this growth (setting aside criticisms of how such growth is measured) in both these allied sectors – the one much larger but the other which is a feature of urbanising India – may be seen in the transformation of cultivation and of food. That is why, not only has the consumer price index for rural citizens climbed without let every year for the last nine years, there is evidence in this index data to show that the rate of increase has accelerated in the last few years.

The trend we have all become painfully familiar with, in states and towns measured and unmeasured.

The trend we have all become painfully familiar with, in states and towns measured and unmeasured.

The consumer price index for agricultural labourers (usually abbreviated to CPI-AL) from 2004 January to 2013 August shows a steady rise for all the 20 states in the set (see the chart alongside). Compiled by the Labour Bureau, Ministry of Labour and Employment, the data shows that the average CPI-AL of these states has been rising around 50 percentage points a year for the last four years. Using quarterly averages (taken for June, July and August) for 2013, 2012 and 2011 and comparing them with the same averages a year earlier, we see that the all-India increases in the index for 12 months (2013 over 2012) is 12.96%, for 24 months (2013 over 2011) is 22.68% and for 36 months (2013 over 2010) it is 34.08%.

States that experienced the steepest increase in the CPI-AL over 36 months are Gujarat with 32%, Punjab 32.4%, Odisha 32.5%, Rajasthan 35.1%, Maharashtra 35.3%, Manipur 37.6%, Andhra Pradesh 37.9%, Kerala 38.4%, Tamil Nadu 39.2% and Karnataka 48.2%. That is why we have witnessed the widespread trend of migration by rural populations towards smaller urban agglomerations, with the impacts recorded in various data releases from Census 2011.

The Labour Bureau data contains evidence that for all states which have CPI-AL measured, the rate at which the index is rising is accelerating. This acceleration is visible when the period 2004 January to 2013 August is divided into five phases. These are represented by the circles in the illustrated chart (the main image above), the phases 2004 Jan to 2005 Dec, 2006 Jan to 2007 Nov, 2007 Dec to 2009 Oct, 2009 Nov to 2011 Sep and 2011 Oct to 2013 Aug). These points (five for each state) are plotted against not the ordinary scale of the CPI-AL but against a range of point increases in the CPI-AL. Hence this shows the rise in the CPI-AL and the more recent speed of that rise.

When India’s food growers cannot afford fuel, light and food

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This group of ten charts describes the trends over more than seven years of the food, and the fuel and light components of the consumer price index numbers for agricultural labourers. The data has been taken from reports issued by the Labour Bureau, Ministry of Labour and Employment, Government of India.

This group of ten charts describes the trends over more than seven years of the food, and the fuel and light components of the consumer price index numbers for agricultural labourers. The data has been taken from reports issued by the Labour Bureau, Ministry of Labour and Employment, Government of India.

This group of charts describes the trends of two indexes – food, and fuel and light – for agricultural labourers in ten states. The consumer price index (CPI) that is usually invoked by the government, by industry, by the corporate associations (such as chambers of commerce), and by economists and banks is a number for that month considered to be ‘national’.

This has no meaning, for what you and I buy is not at a ‘national’ market but at a local one – we may even buy from a roving street vendor, provided our municipal corporation or council has the sense not to outlaw these vendors (which sadly is discrimination common in metropolitan cities).

A consumer price index, in order to be of any use, must be local, and must relate to those who can set some store by it. That is why it is most useful to look carefully at what CPI includes, and it does include much detail, which this small group of charts helps reveal.

The consumer price index numbers for agricultural and rural labourers (with a base of 100 fixed to the year 1986-87) is calculated by the Labour Bureau, Ministry of Labour and Employment, Government of India. Who are agricultural labourers? The Bureau’s definition is: “Agricultural labour households – the rural labour households, who derive 50 per cent or more of their total income from wage paid manual labour in agricultural activities, are treated as agricultural labour households.”

According to the Bureau, a person is considered an agricultural labourer, if she or he “follows one or more of the following agricultural occupations in the capacity of a labourer on hire, whether paid in cash or kind or partly in cash and partly in kind” and the occupations are: farming including cultivation, growing and harvesting of any agricultural commodity; production, cultivation, growing and harvesting of any horticultural commodity; dairy farming; raising of livestock, bee-keeping or poultry farming; any practice performed on a farm “incidental to or in conjunction with the farm operations” (this includes forestry, market-related activities such as delivery and storage, and the actual movement of produce to markets).

The collection of rural retail prices every month from shops and markets is done by the Field Operations Division of the National Sample Survey Office (NSSO). In 20 states it collects data from 600 representative sample villages every month, with one-fourth of the sample being covered every week. Prices are collected either on a market day (which is most commonly a set day of the week) for those villages that do not have daily markets, or on any day for those that do.

And here we have – for Andhra Pradesh, Uttar Pradesh, Maharashtra, Madhya Pradesh, Tamil Nadu, Rajasthan, Karnataka, Gujarat, West Bengal and Bihar, ten of India’s most populous states – the proof of how much India’s growers of food are burdened by the rising price of fuel and light (that means of electricity and power, diesel, kerosene and coal) and of food (cultivators and food growers also buy what they do not grow or husband).

How a farmer who killed himself a year ago appeared in a political ad

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A protest in Karnataka against the political advertisement

The Bharatiya Janata Party (BJP) state government in Karnataka has run a political advertisement featuring a photograph of a farmer. The ad is part of a campaign to get votes for the party’s candidates during elections to village panchayats, to be held later in December. The farmer whose picture was used in the ad committed suicide on 27 May 2009, well over a year ago.

Either the BJP did not know the farmer in the picture was dead, or did not care in its hurry to get the campaign out in time for the elections. Either way, the outrage in Karnataka has turned into protest and all-round condemnation. The point however is that whether it is the BJP or the Congress, this sort of carelessness reflects how little real attention is given to those who grow food in India.

Extracts from press reports:

The family of Nagaraju from a village about 80 km from Bangalore in Mandya district says he killed himself in 2009 after he was unable to pay off massive debts. He left behind a wife and two young children who are in school. “He died one and a half year ago. Our relatives are coming and asking if he is still alive,” says Bhavya, his daughter. The Opposition says the ad proves how little the government is in touch with the state’s farmers. “Does the chief minister have any concern? You can know the government’s true colours are looking at that ad,” says HD Kumaraswamy of the JD(S). The government says it is looking into the matter. “We will take necessary steps to see that it is corrected if it is wrong,” says Chandra Gowda, a BJP MP.

The BJP on Tuesday withdrew a controversial advertisement with the picture of a farmer highlighting B S Yeddyurappa government’s achievements after it learnt that the farmer had committed suicide, and apologized to his family. The farmer in the ad had committed suicide, unable to repay his debts. B H Nagaraju, a native of Babaurayanakoppalu village, barely 3km from Srirangapatna, had killed himself on May 27, 2009. His family was shocked to see his face in the BJP’s poll ads. In the ad, Nagaraj, who holds sugarcane and a sickle, smilingly talks of his fortune changing after the BJP government took over in Karnataka. His family members claimed Nagaraju committed suicide after he was caught in a debt trap. He is survived by his parents, wife Lakshmi and children Bhavya and Umesh. His father Hanumegowda said his family did not own any land and his son was an agriculture labourer. His daily wages weren’t adequate to support the family.

The BJP issued the advertisement in a few Kannada dailies Sunday ahead of the Dec 26 and Dec 31 polls in 176 taluka (sub-district) and 30 zilla (district) panchayats. The enraged villagers and family members of Nagaraju, who is survived by his parents, wife and two children, are planning to block the Bangalore-Mysore highway Wednesday as the BJP has not apologized for the goof up. “We will stage a dharna on the Bangalore-Mysore highway on Wednesday as no one from the BJP has come to the village to apologise to Nagaraju’s family,” said B.S. Sandesh, former president of Srirangapatna taluka. The farmers staged a demonstration in Baburayanakopplu on the Mysore-Bangalore highway on Monday, protesting against the advertisement, and raised slogans denouncing the government.

India’s 2008 food flows mystery

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CPI for Agricultural Labour data from 2007-10 March and FAO food index data over the same period

CPI for Agricultural Labour data from 2007-10 March and FAO food index data over the same period

My working experience with a central agriculture ministry programme (the NAIP – National Agricultural Innovation Project) has left me with some impressions of the perspective of the central institutional approach to agriculture, and these aren’t encouraging. My finding is (although I have little access to academic output on agriculture which is not crop science):

1. We in India lack an independent food retail price gathering and monitoring network. The data gathered by the Ministry of Agriculture (through its Directorate of Economics and Statistics) and by the Ministry of Consumer Affairs, Food and Public Distribution use different formats and schedules. Validating these is a huge task, and that is the reason why the unit level (place, food item, time) extraction becomes so very cumbersome.

2. We have even less knowledge (outside the commercial circuit) of the flows of agricultural produce: (a) From mandis to urban centres. Large transfers of foodgrains are logged by Indian Railways, but at district level, we have very little reliable data of the flows of cereals, pulses, vegetables and fruit, within district centres and outside; (b) From mandis (and contract farms, now strengthened by a draft national agriculture produce marketing committee act, APMC) to the food processing industry, and to commercial storage depots for use by either food processing sector and by the agri commodities exchanges.

3. Agriculture continues to be seen by central and state governments mainly as an APY (area, production, yield) activity, only rarely as a livelihood activity for a rural household (institutes such as Crida buck this trend, but we need more of them). That is why our organised state-level assessments are also still APY-centric (with a few scattered instances of enlightenment in the form of recognition of conservation agriculture). This is frustrating at a systemic level, because for example the Planning Commission has at hand any number of NGO and commissioned studies and assessments that place cultivation as a socio-cultural livelihood activity.

I’d say there that are technology answers to points 1 and 2 (see how commercial ventures like Nokia Lifetools, Reuters Market Light, Hariyali Kisan Bazar have used tech) but point 3 needs a lot of work.

This chart that I’ve made shows why. It uses the consumer price index (CPI) for Agricultural Labour data from 2007-10 March and FAO food index data over the same period. The eight states I’ve chosen (Haryana, Karnataka, Punjab, West Bengal, Maharashtra, Rajasthan, Tamil Nadu, Andhra Pradesh) recorded the highest increases among large states of CPI-AL over the period.

The FAO indices climb steeply till around Feb 2008. By December 2008 the FAO cereal index is back to the level it was at in August 2007. For that time the CPI-AL 8-state rise is relatively gradual and disconnected from the FAO trend. Between around Jan 2009 and July 2009 both FAO indices show some volatility in the 100-125% band. The 8 states’ CPI-AL however continue their rising trend. Only in December 2009 is there evidence of some congruence between the FAO set and the 8 states CPI-AL set, although the FAO pair are 105-120% up from March 2007 and the all-India CPI-AL is more than 135% up.

The big question for us is: what happened with food movements in India between 2007 July and 2008 November, when India and FAO data diverged so dramatically, and then from 2009 May onward, when the movements showed some similarity, although at different levels of the comparative index? Do the agricultural commodities markets hold the answer?