From: rajkumar@ece.orst.edu (Rajkumar Vedam)
Newsgroups: soc.culture.indian
Subject: Re: "Unemployment Problem of India" (***very long****)
Date: 21 Aug 92 20:53:25 GMT
Article-I.D.: talon.1992Aug21.205325.714
Followup-To: rajkumar@ece.orst.edu
Organization: Oregon State University, Corvallis
Originator: rajkumar@gunarh.ECE.ORST.EDU



In article <KOTES.92Aug16201134@splinter.coe.northeastern.edu> kotes@splinter.coe.northeastern.edu (Koteswararao Nandipati) writes:
>
>
>The following is an excerpt from the book "Small is Beautiful" by 
>E.F.Schumacher.
>
>(A study of economics as if people mattered). 
>
>****fore warning*****
>This is a very long article, ~10pages. Please be aware of it before
>start reading it.
>*********************
>
>
>The Problem of Unemployment in India
>(A talk to the India Development Group in London)
>



Thanks for posting the long article. I will not respond to
specific points in the essay itself, but will make 
comments in general. I do hope I will not be
preaching to the choir.

At the outset, it is necessary to appreciate the phenomenon
of widespread poverty in India, for this is most evident,
whether in big cities, small towns, or in the villages one
sees while travelling in trains in India. Through this,
hopefully, one can develop an appreciation for the priorities
at hand.

It is well known that upto 75 % of India lives in the
villages. So any study of poverty must begin here. At the
risk of oversimplifying the picture, I will say that the basic
structure of the Indian village has not changed since vedic
times. 

Very similar to the caste system, there are distinct
sections of the village society common to all villages. The
most powerful section are the landowners, who own most of
the land surrounding the villages, and in many cases, serve
as arbiters of justice. A host of local and migrant
workers are typically hired to work in the fields through
seeding and harvest times. A battery of skilled labourers
serve the needs of this community, professing such skills
as pottery, iron-smiths, weavers, carpenters and goldsmiths. 
There are typically a few priests who attend to the village temple,
and served (at least in the old days), as educators of the
rich class. All skills are passed down from father to son.
During harvest times, the landowners reap money,
pay out salaries to hired hands, inter-village shandies serve to 
percolate local economy, with merchants buying and selling, 
everything from pots , pans, bangles, clothes, cattle , medicine,
cosmetics, grains - just about everything. Everybody participates
in the haggling, buying, matchmaking....In short, the picture 
is complete; the economy is a totally self-sufficient one. These
are truly the Indians in their simple way of life, simple beliefs,
the sons of the soil, whose existence relies on agriculture.
The author of the essay fails to recognise this underlying
society, when he facetiously recommends mass employment,
perhaps viewing India though the typical western tourist
eye. However, he recognizes a need for such a society
in his sermon:


>no exports. We did not start development by obtaining foreing exchange
>from Mars or from the moon. Mankind is a closed society. India is a
>quite big enough to be a relatively closed society in that sense -- a
>society in which the able-bodied people work and produce what they
>need. 


However, I have not addressed poverty as yet. 

Part I:

Everybody knows the dependency of Indian agriculture on the 
monsoons. No monsoon - no harvest. No harvest - no salaries. The
landowners get by on hoarded grain, or on bank balances
to buy their food. The rest of the economy suffers - migrant
workers, local workers, skilled workers. A few throw themselves
to the mercy of loan-sharks, eventually pawning away all their
belongings, or as till in the recent past, serving as
bonded labourers. Therein begins a migration of impoverised 
rural folks to the cities, to eke out an existance, serving 
as construction workers, servants, etc, living in slums. 
The poorer and unfortunate ones find themselves begging 
and living on pavements. If nature is kinder during the
next season, the ones who haven't burnt their bridges
return home . The others remain in the cities ("there's
nothing to return to"). It is important to note that such 
"naturally occuring" poverty existed over the ages.


A lot of Western and Indian thinkers have advocated the
use of technology to upgrade the quality of life. Question:
Will it be better to have a gradual assimilation of technology,
(as e.g., M.K. Gandhi adviced for post-independent India)
or would it be preferable to have a rapid transition (As opted
for by J.Nehru, via the 5-year plans) ? Contemporary history
bears witness to the fact that India, which did not possess
the technology to manufacture a safety pin in 1947, today
produces virtually every item of consumer goods, not to
speak about indigenous nuclear , space and computer technology.
Apparently this pace isn't rapid enough by Western standards,
as for example, evidenced by the author's essay. But who benefits
by such rapid growth - townsfolk or rural ? The answer is
not difficult to speculate:


Part II

The breakdown of traditional society: 

With the availability of mass factory produced stainless 
steel, and aluminum vessels, guess who's out of a job -
you got it - the traditional potter, whose ancestors
served as prominant members of the Mohenjadaro-Harappa
culture, who handed down skills from father to son, now
finds nobody buying his works of devotion and love. The
disillusioned and bankrupt man  prefers his son to go
to the big city for a job, rather than learn a now
useless skill. But guess what jobs his son will get,
without education ? So the factory in the city gave jobs
to city youth, and impoverished a village industry.

With the availability of cheap plastic toys, who
bothers buying anything made out of wood at village
shandies ? Yep, you guessed it - there goes the
carpenters' livelihood, taken by some more city folk
working in toy factories in the big city.

With the advent of TVs in villages, and the inevitable
consumerism generated, there is now huge rural markets 
for cosmetic goods - shampoos, soaps, talcum powders, toothpaste,
brushes, etc. This further wipes out local village
industry which made tooth-powder, "shikkakai" (natural
soaps), etc.


So what happened ? Rapid industrialization ripped
out the heart of traditional village structure, and
left in its wake, a poverty-ridden ghost of the past.
Rapid industrialization created hazaar new jobs in
the cities, and yes, they benefitted the city folks.
Rural migrants have to wait their turn a couple
of generations, before one of them squeaks past a
certificate or diploma course, and gets a job. Did
the urban prosperity and economy percolate down
to rural folk as predicted by planners ?  I'll
leave that unanswered.

Does the parasitism of Industrialization on Rural
life stop here ? No chance ! The hunger for more
electric power, minerals, trees, land, water which
are necessary to feed the huge industrial machinery
encroaches systematically and steadily on rural
folks thru' building dams and displacing and
impoverising native folk, chopping down forests 
and impoverising forest folks, claiming
prime wet land on the outskirts of mega-cities
for "urban growth" - the list is endless.

The total breakdown of the caste-system - which
served the society of yesteryears (about 5000
years) - has brought in its wake, utter abject poverty
to the majority of rural folks. It has also
encouraged widespread migration of rural youth to
cities, in search of jobs, etc. 

Only of late has the govt. started encouraging
the establishment of industry in small towns, rather
than in mega-cities. (E.g., entrepreneurs starting an industry
in the Karnataka small town Mandya, pop. 100,000,
100 km off B'lore, will get many tax benefits, compared
with starting an industry in Bangalore). However,
such a course of action is fraught with problems
of resources. To operate industries, one needs skilled
mechanics. There is need to create sufficient infrastructure
by building certificate and diploma schools in rural areas.
One needs decent access to highways, or correspondingly,
railway system to transport goods to markets. One needs
power and water to run industrial cities. In the absence
of such amenities, is it any wonder that small towns still
fail to attract enterprise ? Thus the pattern of rural
poverty , urban migration, and detrimental industrialization
continues....


The problems facing planners are many. The question
anyone has to ask himself is this: Should growth be
planned keeping the big picture in mind, in which
success can be measured only in a decade's time, or
should one opt for "tomorrow is too late" kind of
plans, where one pushes for immediate results, paying
scant attention to long term dynamics ? I fear we have
already embarked into the latter. The author of the
essay would have us pushed further along this path:



>touch any thing unless it is optimal. What is stopping us? Theories,
>planning. I have come across planners at the Planning Commission who
>have convinced themselves that even within fifteen years it is not
>possible to put the willing labour power of india to work. If they say
>it is not possible to do the most elementary thing within fifteen
>years, this is just a sort of degeneracy of the intellect. What is the
>argument behind it? Oh! the argument is very clever, a splendid piece
>of model building. They have ascertained that in order to put a man to
>work you need on average so much electricity, so much cement, and so
>much steel. This is absurd. I should like to remind you that a
>hundred years ago electricity, cement and steel did not even exist in
>any significant quantity at all. ( I should like to remind that the
>Taju Mahal was built without electricity, cement and steel that all
>the cathedrals of Europe are built without them.) You may say, again,
>this is not an economic problem, but basically a political problem. It
>is basically a problem of compassion with the ordinary people of the
>world. It is basically a problem, not of conscripting the ordinary
>people, but of getting a kind of voluntary conscription of the
>educated.
>
>    Now, at the risk of being misunderstood, I will give you the
>simplest of all possible examples of sel-help. The Good Lord has not
>disinherited any of his children and as far as India is concerned he
>has give her a variety of trees, unsurpassed anywhere in the world.
>There are trees for almost all human needs. One of the greatest
>teachers of India was the Buddha who included in his teaching the
>obligation of every good Buddhist that he should pland and see to the
>establishment of one tree atleast every five years. As long as this
>was observed, the whole large area of India was covered with trees,
>free of dust, with plenty of water, plenty of shade, plenty of food
>and materials. Just imagine you could establish an ideology which
>would make it obligatory for every able bodied person in India, man,
>woman and child, to do that little thing -- to plant and see to the
>establishment of one tree a year, five years runnign. This, in a five
>year period, would give you 2,000 million established trees. Anyone
>can work it out on the back of an envelope that the economic value of
>such an enterprise, intelligently conducted, would be greater than
>anything that has even been promised by any of India's five year
>plans. It could be done without a penny of foreign aid; there is no
>problem of savings and inestment. It would produce food stuffs,
>fibres, building material, shade, water, almost anything that man
>really needs.
>


This is as incredulous as the flying yogi who claimed that
by channelling the minds of all humans at the same time, he
could push "Skylab" out of its unstable orbit !

The path is clear: (1) Improve irrigation facilities,
by all means possible, if necessary, by altering the
paths of rivers from North-South. This will remove the
dependency of Indian agriculture on monsoons, and be
a major factor in eradicating rural poverty. 

(2) Improved Rural programs - primary and high school
education, co-operative societies and banks, primary
health centers, and a re-encouragement of rural industry.
E.g., weaving, handicrafts can give rural women a new
lease on life, by providing employment, self-pride,
commercial awareness, and a means of population control.

The above will assist/affect even the most common rural folk.

(3) Improved farm technology - fertilizers, seeds,
farmer education, cattle breeding, farm implements, etc.

(4) Reasonable prices on power, interest rates on
farm loans, reasonable buying prices on farm produce 
<rice, sugercane, wheat, millets, etc>.

The above two will assist rich farmers. But with their
prosperity, employment is assured for workers.


>    I just leave this as a thought, not as the final answer to India's
>enormous problems. But, I ask: what sort of an education is this if it
>prevetns us from thinking of things ready to be done immediately? What
>makes us think we need electricity, cement and steel before we can do
>anything at all? The really helpful things will not be done from the
>centre; they cannot be done by big organisations; but they can be done
>by the people themselves. If we can recover the sense that is the most
>natural thing for every person born into this world to use his hands
>in a productive way and that it is not beyond the wit of man to make
>this possible, then I think the problem of unemployment will disappear
>and we shall soon be asking ourselves how we can get all the work done
>that needs to be done.
>


The above rhetoric is not out of place. But the means
advocated are certainly out of place in India. India
needs controlled evolution of industries, well planned
so as not to excite the unmodelled dynamics of rural
poverty and urban migration. At the same time, an all-out
effort must be made to eradicate rural poverty - via
improved irrigation, education, medical facilities,
co-operatives and banks, fairer prices, etc. Unfortunately,
the recent market-freeing policies do not favour
such trends. Rapid urban prosperity thus will take
place only on the ruins of rural life - the very
soul of India. When the bottom caves in.....


--------------
Rajkumar Vedam
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