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Creating 100 Million Jobs in India

Development of agriculture is critically important for ensuring food and nutritional security for the hundreds of millions of people that still live below the poverty line, for raising rural incomes and generating employment opportunities, and for stimulating industrialization and overall economic development of the country. Raising the productivity of irrigated and rain-fed agriculture, combined with rainwater harvesting and water conservation techniques and assured access to remunerative markets for agricultural produce through linkages with agro-industries can dramatically raise rural incomes, generate millions of on-farm and non-farm employment opportunities, eradicate poverty and usher in a prosperity movement throughout rural India.

 Prosperity 2000

In 1991 the International Commission on Peace & Food (ICPF) conducted a country study of employment potentials in India. The study found that India would need to create an average of 10 million jobs a year for the next 10 years in order to provide employment opportunities to all job seekers and also to the approximately 35 million unemployed at that time. The Commission drew up a strategy entitled Prosperity 2000 which included practical and specific measures designed to generate 100 million additional employment opportunities within 10 years.

The thrust of the Prosperity 2000 strategy was to directly utilize agriculture as an engine to raise on-farm incomes and purchasing power, generate additional on-farm employment opportunities, and stimulate rural industrialization and services. These would in turn increase demand for agricultural products, manufactured goods and services throughout the economy, creating a multiplier effect that generates jobs in other sectors. The specific focus on the strategy was on raising on-farm productivity and fostering closer linkages with industry and markets through innovative approaches to the organization of the rural economy. The strategy was based on the perception that due to the relatively low level of nutrition in the Indian diet, rising income levels would result in a dramatic increase in demand for fruits, vegetables, sugar, dairy products, fish, meat and cotton textiles. The strategy sought to leverage this latent demand to spur job creation and higher rural incomes which would in turn act as a stimulus on other sectors of the economy.

The strategy was presented to the Prime Minister, Mr. P.V. Narasimha Rao, in December 1991, examined by the Planning Commission and related government departments, and formally adopted by the Government of India as official strategy within three months from its initial presentation. Manmohan Singh, then Finance Minister, now Prime Minister of India, included funding for the program in the 1992 Budget. A specialized agency, the Small Farmers’ Agri-Business Consortium, was also established by the Government to implement the strategy.

Two subsequent studies were conducted that confirmed the feasibility of this strategy at the local level: a study of Pune District by the Agricultural Finance Corporation for the Government of Maharasthra and a study of Pondicherry by the Mother’s Service Society.

The original purpose of the study had been to demonstrate a theoretical and practrical potential. It had not been seriously envisioned that the Government would adopt the strategy for implementation. In fact, in formulating the strategy the Commission had stipulated that government could only effectively play a catalytic role and recommended the establishment of autonomous agencies with strong private sector participation to preside over implementation. In actuality, after a delay of two years in working out bureaucratic modalities, the government attempted to implement it through normal department channels. Shortly afterwards, a new government came to power and the program was dropped for political reasons. In spite of this fact, employment did record a significant surge in the following years and to approximately double the level prevalent in 1991.

Ten Year Review

In the national parliamentary elections conducted in the Spring of 2004, the issue of employment was raised to the top of the agenda and the winning coalition led by the Indian National Congress (I) Party was elected on a platform the included a commitment to introduce legislation to guarantee a minimum level of employment to all job seekers in the country. It is noteworthy that the goal of creating 10 million jobs a year was revived at this time.

In the summer of 2004, the Commission conducted a review of the original strategy. It found that some of the potentials it had identified have been partially exploited, such as the dramatic increase in production of fruits and vegetables, export of grapes and mangoes from Maharashtra to Western Europe, the rise in production and per capita consumption of sugar, and grow of inland aquaculture. The original report examined the current levels of food consumption and dietary nutrition among the Indian population-at-large and projected growth in demand that would result from the gradual rise in living standards for fruits, vegetables, sugar and dairy products. The actually rise in demand for fruits and vegetables has nearly matched ICPF’s projection.

In retrospect, ICPF found that the technological and market potentials identified in the original study remained valid 13 years later. The scope for improving farm productivity, the potential for improving linkages with processing industries, and the scope for dietary enhancement remain as great as before. However, the organizational mechanisms required to fully tap these potentials needed to be re-examined in the light of the changing role of government and private agencies in the development process. In addition, the Commission found need to take into account changing external conditions that open up new opportunities and present new challenges, especially the rise in international energy prices and the increasing opportunities for textile exports after the removal of quotas in January 2005.

In retrospects, the Commission drew the following lessons and conclusions from the India study:

1.      The study demonstrated the theoretical possibility of creating full employment in India, the second largest labor market in the world.

2.      The study provided a practical strategy for achieving full employment that was accepted and endorsed by a wide range of national level experts in government, business and the academic community as valid and achievable.

3.      Actual implementation of the strategy was never seriously attempted by the government.

4.      Many of the potentials identified in the report and publicized by the media and in presentations to the business community were at least partially exploited over the subsequent decade.

5.      In Pune District, Maharashtra, the one district in which the strategy was implemented aggressively by the state government, employment growth was dramatic and labor scarcities became prevalent.

6.      For a variety of reasons, some directly connected with this study and some apparently unconnected, employment generation in India has risen dramatically since the early 1990s. Although reliable data is lacking, job growth appears sufficient at least to absorb the seven million additional job seekers entering the labor market every year.

Updated Strategy

At the request of the National Farmer’s Commission, ICPF revised and updated the strategy in the light of developments that had occurred since the original study, lessons learned and new emerging opportunities. The revised strategy was submitted to the Government of India in December 2004 and portions of it have been incorporated in official policy.

The revised strategy retained many of the elements of the original program though the approach for implementation changed significantly. The new program also included number of significant new elements. Most notable among the new feature was the emphasis on production of energy crops to meet India’s surging demand for fuel and power which were projected to triple between 2000 and 2020. The study pointed out producing energy from biomass, bio-fuels and ethanol provided multiple benefits. It would reduce dependence on energy imports. It would distribute the benefits of energy expenditure to the rural population rather than to foreign energy producers. It would act as a substantial stimulus for the development of efficient, low cost decentralized power plants and other agro-based industries. It would generate enormous employment potential in rural areas.

The major findings and recommendations can be summarized as follows:

1.      The Indian economy is already generating approximately seven million employment and self-employment opportunities per annum, almost all of them in the informal sector, but in there is a serious lack of accurate information on the types and numbers of these jobs. The most effective strategy for employment generation will be to provide the missing links and policy measures needed to accelerate this natural process of employment generation.

2.      There is enormous scope for raising the productivity of Indian agriculture, doubling crop yields and farm incomes, and generating significant growth in demand for farm labour. The report present evidence to demonstrate that improving plant nutrition through micronutrient analysis and improving irrigation through deep chiselling of soil can result in a tripling of crop yields.

3.      Rising rural incomes consequent to higher productivity will unleash a multiplier effect, increasing demand for farm and non-farm products and services, thereby stimulating rapid growth of employment opportunities in other sectors.

4.      Indian agriculture is constrained by weak linkages between agricultural training and extension, crop production, credit, processing, marketing, and insurance. The report presents an integrated strategy for bringing together all these elements in a synergistic manner by

a.       Establishment of village-based Farm Schools to demonstrate and impart advanced technology to farmers on their own lands.

b.      Establishment of a network of sophisticated soil test laboratories capable of high volume precision analysis of 13 essential plant nutrients coupled with development of expert computer systems to interpret soil test results and recommend individualized  packages of cultivation practices for each crop, location and soil profile.

c.       Establishment of Rural Information Centres to act as a medium for transmission of soil test data and recommended practices, access to current input and market prices, and other essential information for upgrading agriculture.

d.      Policy and legal measures to encourage contract farming arrangements between agri-business firms and self-help groups in order to increase small farmers’ access to advanced technology, quality inputs, bank credit, processing, marketing and crop insurance.

e.       Measures to strengthen farm credit and insurance programmes, including creation of linkages between crop insurance, crop loans, and farm school training to encourage farmers who seek credit and crop insurance to adopt improved cultivation practices.

5.      In order to ensure ready markets for the crops that are produced, the report focuses on the potential for linking crop production with huge untapped markets and specific agro-industries, including energy plantations to fuel biomass power plants, bio-diesel from jathropa, ethanol from sugarcane and sugar-beet, edible oil from Paradise Tree, horticulture crops and cotton.

6.      The report argues that the India labour force suffers from a severe shortage of employable skills at all levels and that intensive development of vocational skills will act as a powerful stimulus for employment and self-employment generation. In addition to Farm Schools to impart advanced skills in production agriculture, the report recommends establishing a network of government-certified, rural vocational institutes providing training and certification in hundreds of vocational skills not covered by the ITIs. In order to offset the shortage of qualified trainers and the costs of replicating institutions throughout the country, the report advocates creation of a national network of ‘Job Shops’ linked to the Rural Information Centres and offering televised multimedia training programmes and computerized vocational training programmes.

7.      The report recommends that the National Commission on Farmers arrange for employment surveys to provide accurate information on the growing demand for different occupational categories, the natural rate of employment generation by category and skill level, and other issues required to promote full employment in the country.


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