Livelihoods in MP


The central Indian state of Madhya Pradesh has a population of slightly over 60 million, according to Census 2001. Over the previous decade, the annual increase in population has been 13.3 lakh persons per annum.

The Third Human Development Report of Madhya Pradesh (2002) estimates that 10 lakh jobs will have to be generated every year to productively absorb the growing workforce.

Livelihood challenge

Around the mid-1990s, 22 lakh workers in Madhya Pradesh (around 6% of the state’s total workforce) were in the organised sector. The majority of workers (94%), including agricultural labour, construction labour and workers in traditional industries like leather-tanning, forestry, fishing, bidi-rolling, household workers and village artisans are in the unorganised sector.

Evidence, both from field experience and from various studies, shows that employment opportunities created in the country have been inadequate, although Gross Domestic Product (GDP) growth has accelerated after liberalisation of the economy.

In Madhya Pradesh there has been a deceleration of employment growth over time, touching a low of 0.9% per annum in the late-1990s, which was the result of a slowdown in public sector employment. Higher growth rates in the private sector could not compensate for the loss of workforce in the public sector.

With a share of around 35% of the state’s GDP, agriculture and allied activities have to support 75% of rural workers.

Remuneration received from most livelihoods in Madhya Pradesh is low, and more and more people in households are required to work to sustain families. National Sample Survey (NSS) estimates indicate that an approximate 17% of rural children in the state, the fifth-highest in India, in the age-group 10-14 years, are working.

The development challenge therefore is not just creating new jobs, but generating new livelihoods in the rural areas and making existing livelihoods stronger and more sustainable.

Looking at the future

A large number of those classified as 'employed' are engaged in low-quality employment, which does not provide adequate income to keep a family above the poverty line. Besides, the employment opportunities available in the market also often do not meet the expectations of new and increasingly educated entrants to the labour force.

The employment strategy needed therefore is not one that ensures adequate growth in the volume of employment, but one that ensures sufficient growth in high-quality employment opportunities.

The state Human Development Report’s projections show that employment will increase from 29.6 million in 2001 to 44 million in 2020, ie by 14 million. On the other hand, including the backlog of 3.7 million unemployed and severely under-employed persons in 2000, by 2020 the number of people needing employment will increase to 18 million. The difference between these numbers (4 million) sums up the livelihood problem for the state in the coming decades.

Since labour is the main asset for a majority of the poor, expanding and providing opportunities for productive employment is central to sustained poverty reduction.

Agriculture challenge

The number of small agricultural landholdings in Madhya Pradesh has been increasing due to multiple divisions. The share of marginal and small farmers in the total landholding area and the number of holdings in the state increased from 9.6% in 1970-71 to 21.5% in 1995-96, an increase of 75% in terms of land under small and marginal farmers.

Data for 1995-96 shows that around 61% of landholdings in the state belong to marginal and small farmers. There were 39.3 lakh small and marginal farmers in the state, and they were mostly under-employed. The average landholding of small and marginal farmers was 0.91 hectares, which is uneconomical by any standards.

As a result, the majority of small and marginal farmers were forced to work as agricultural or casual labourers. Data from NSS rounds report a gradual ‘casualisation’ of the workforce; the proportion of casual labourers went up from 32% male and 38% female casual labourers in 1993-94, to 37% male and 44% female casual labourers in 1999-2000.

Links to irrigation

In addition to the small size of landholdings, agricultural productivity is also affected by inadequate irrigation facilities. In the case of major kharif crops, the low productivity belt is largely concentrated in the Rewa and Sagar divisions, as well as the three Nimar districts. In the case of rabi crops, the districts at the bottom in terms of yield per hectare fall entirely in the Rewa division and the southern tribal districts of Jabalpur division. The three districts of Nimar record comparatively high levels of productivity in rabi crops, ranking on this parameter at numbers 5, 6 and 14 among the 45 districts in the state.

Irrigation is the key differentiator. The districts with low productivity in rabi crops have an irrigation intensity of less than 20% and include, besides the western district of Jhabua, a clear contiguous geographical belt of eastern Madhya Pradesh encompassing the districts of Panna, Rewa, Shahdol, Sidhi, Umaria, Dindori, Mandla and Seoni.

The Nimar districts are comparatively better-off in terms of irrigation intensity, and this links up with improved agricultural productivity in the rabi season.
There is thus a need to bring the eastern belt into focus and look at ways of making a concerted effort to increase irrigation intensity, as well as undertake watershed development in a big way.

Simultaneously, non-agricultural land-based activities need to be considered.

In the case of relatively better irrigated districts in the Nimar region, technical solutions need to be sought to enhance productivity in the kharif crop.

Priority districts for diversification from agriculture

The number of agricultural workers can be used as an indicator for identifying districts where the need for diversification into the non-farm sector is high. Overall, 28.7% of all workers in the state are engaged as agricultural labourers. Districts with a very high share of agricultural labourers are:

In these districts, over 40% of workers are engaged as agricultural labourers.

Nearly 40% of the state’s agricultural labourers are concentrated in the 11 districts of Rewa, East Nimar (Khandwa), Balaghat, Chhindwara, West Nimar (Khargone), Dhar, Sidhi, Shahdol, Seoni, Satna, Betul and Sagar, in the south-central part of Madhya Pradesh, characterised by heavily forested areas and a large tribal population.

Districts with a low concentration of labourers in agriculture are (excluding districts with large urban concentrations like Indore, Bhopal and Gwalior), Morena, Jhabua, Datia, Tikamgarh, Shivpuri, Bhind and Chhattarpur. These districts form the Bundelkhand belt of the state along with some districts from the Chambal/Giridh belt.

Sagar and Damoh have a very high number of non-agricultural workers - 48% and 42% respectively - but almost half of them belong to household industries; they are mostly bidi-rollers. Bidi-rolling extends to Katni, Jabalpur and Satna.

Apart from Sagar and Damoh, districts with a significant non-agricultural workforce (at least 25%) are Katni, Hoshangabad, Satna, Ujjain, Morena, Raisen, Bhind, Shahdol, Chhindwara, Vidisha, Ratlam and Chhattarpur.

There is no significant regional pattern here, but many of these districts have a good agricultural base. A few significant zones in terms of diversified livelihoods are Sagar, Damoh, Katni, Jabalpur in central Madhya Pradesh; Gwalior, Bhind, Morena in the north; Ratlam, Ujjain, Indore in the western Malwa plateau; and the Hoshangabad-Bhopal belt in the west centre of the state.

All these zones have their own characteristics, but the common elements are that they have zones of agricultural prosperity, and are close to large urban conglomerations and some industrial activity.

They are also interestingly associated with specific crops or types of produce. For example, mustard is associated with Bhind and Morena, and soybean with Ujjain and Ratlam.

On the lower side of employment diversification fall Dindori, Jhabua, Mandla and Barwani (non-agricultural workers constitute 15% or less of all workers). Including these districts, there are 16 districts in the state where non-agricultural workers constitute less than 20% of all workers.

Such a low diverse base for employment is a worrying situation especially in the case of districts where agriculture potential is low. In these districts, agricultural growth would simply not absorb the growing labour force. The immediate challenge here is to shift workers to the non-agriculture sector.

Forests and livelihoods

Nearly 40% of the state’s villages are either forest villages or are situated close to forests that play a significant role in the livelihoods of the people. But it is difficult to estimate the exact number of people dependent on forests. According to the state Human Development Report, in the case of persons collecting Non Timber Forest Produce (NTFP), the period of direct person-days of employment is not very significant, say 10-15 days to a month at the maximum, in a year.

People’s rights over forests are strictly regulated by laws, which, in the past, denied villagers easy access to forests in order to earn a living. A gradual change is being witnessed with the granting of ‘nistari’ rights, and the Joint Forest Management (JFM) programme. However, conflict between villagers and the authorities still exists.

A more people-friendly forest management regime needs to be evolved between the local people, forest management and government regulations.

Shifting out of agriculture

According to the state’s Human Development Report, to make a visible impact on the employment pattern it is necessary to reduce the workforce in agriculture from over 80% to 40%, by 2020. This would mean a shift out of agriculture into manufacturing, construction, infrastructure and, substantially, to the services sector.

Even within agriculture, diversification is needed - from crop cultivation to horticulture, dairy, poultry, fishery and forest-based activities.
The macro projections in the state’s Human Development Report show that a focus on agriculture and allied activities, besides the services option, would be most desirable in order to increase employment.

Generating new forms of livelihood-generation would require concerted efforts by the government, donors, private sector and civil society institutions in the sectors and opportunity areas listed below.

Natural resource management: opportunities

  • Watershed development - enhancing productivity and stabilising the incomes of dryland farmers of soy, mustard, arhar, chana, jowar.
  • Irrigated crops - increasing the productivity of wheat, cotton, sugarcane, paddy, and improving quality to meet local processing and export marketing standards.
  • Horticulture development - promotion of citrus, peas, potatoes, vegetables, flowers, cultivable aromatics.
  • Joint forest management - scientific, environment-friendly promotion of business in tendu, mahua, amla, myrobalans, other NTFP, bamboo and timber.
  • Livestock rearing -- promotion of dairy, poultry, sheep/goat-rearing.
  • Fishery, sericulture.
  • Minor minerals - scientific, environment-friendly promotion of business in stone, sand and limestone.

Small industries: opportunities

  • Agro-processing -- wheat, soybean, mustard, paddy, pulses, cotton, spices, vegetables.
  • Crop inputs -- bio-fertiliser, bio-pesticides.
  • Livestock-based processing -- dairy, poultry, fish, leather, meat. Timber and NTFP -- aromatics, medicinal plants, bamboo, tendu (bidi), mahua, amla-processing.
  • Stone-processing, cement-building materials.
  • Textiles - handloom (niche products), powerlooms, apparel (low- and high-end).
  • Metal, glass, ceramic and plastic products.

Rural and small infrastructure: opportunities

  • Power - decentralised generation, biomass, local power-distribution franchises.
  • Irrigation - tanks, canals, borewells.
  • Water - drinking water franchises.
  • Roads - construction and repair, toll-collection.
  • Road transport terminals; container depots.
  • Warehouses and cold storage facilities.
  • Plant nurseries, tissue-culture units.
  • Market yards (mandis) and haats.
  • Telecom - including voice and Internet.

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