PrintFriendlyThe world is witnessing an unprecedented level of a pandemic related crisis coupled with economic distress. Every country is trying in its own way to deal with it. But perhaps no other country faces the magnitude of challenges that India faces given the enormity of the population that has to be protected and taken care of. And yet, no other country has tried as much, to convert the crisis into an opportunity, to become more resilient through structural reforms, than India has.
The Journey of Last Three Months: Resilience, Restructuring & Recalibration
From that perspective, India’s journey over the last three months has been demanding and yet an exemplary one, both in terms of capacity building for treating Covid-19 patients, to striving for self-sufficiency in making different kinds of medical equipment, as well as in making sure that the basic minimum support, in the form of food grain and money, reaches to that section of populace, with most modest means, for whom it is a perpetual trade-off between saving lives or livelihood.
In the midst of the fight against a dangerously contagious disease, India, unlike many other countries, had to continue its battle against Pakistan sponsored terrorism and confront a shocking attempt of status-quo alteration by China, which left the country with no option but to remain prepared for a full-fledged war if the need be.
For a country with 135 crore population and with such density of people, India has been considerably successful in keeping the infection cases to a little more than a million, as of yet, with more than half a million almost having recovered from Covid-19 infection.
In addition to that, under the leadership of PM Modi, the Central Government initiated an unprecedented exercise of recalibrating and decoupling India’s economy that is aimed at making it more resilient. A series of measures have been taken in that realm to strengthen the framework of India’s MSME and agriculture sector, to enhance their capacity building architecture as well as empowering them to become competitive enough and strive to be part of the global supply chain in the near future.
The Indian Challenge: More Profound and Complex
It is important here to mention that the challenges that India faced in the midst of the Covid-19 pandemic are far more profound than what has been faced by many other countries, be it in Western Europe or US. One of those challenges has been the issue of managing the migrant labour force and taking care of them during this crisis phase.
The Legacy of the Migration Crisis
In fact, one of the most undesirable legacies of India’s story since 1947, is that of the creation of the rural-urban divide wherein urban India continued to grow and attract investments while rural India was unfortunately and deliberately kept impoverished through systematic stifling of agriculture and blocking of movement of industrial investments into rural India, which otherwise would have unleashed the rural growth story and prevented mass migrations of the hapless rural workforce into urban India in quest of jobs.
Across the spectrum of many of European countryside, industry and agriculture coexist whereby many critical agricultural produce, and intermediary products or materials, eventually become key ingredients supplied to factories nearby, but not so in India. Here, it has been quite an irony that the city-dwelling left-liberal socialists and vested interests, for long, prevented agricultural reforms, and industrial development, in rural India thereby compelling the village dwelling Indians to shift to cities, and reside in urban slums, in search of jobs in those very factories whose migration to rural India have been prevented routinely.
Nevertheless, as a result of this pandemic, the migrant workforce, in millions, was compelled to return to their native places and it was necessary to create work avenues for them so that it does not lead to financial emergency en masse.
The Schemes in Details
While extending the Pradhan Mantri Garib Kalyan Anna Yojana (PMGKAY) by five more months till November[i], whereby 800 million Indians would be provided with free ration by Central Government at a combined cost of Rs 1.5 Lakh crores, since its initiation in April 2020, PM Modi led NDA Government also initiated the Pradhan Mantri Garib Kalyan Rojgar Abhiyan (PMGKRA) aimed at providing sustainable work opportunities to migrant workers who had returned to their native places during the pandemic phase.
The two schemes also have a profound message. Irrespective of what shape the Covid-19 pandemic takes and irrespective of whether India is compelled to get into a conflict with China or not, PM Modi is assuring people of India, especially the distressed sections, that his Government would continue to support them with provisioning of food grain and productive employment during the entire crisis period. This is a powerful message and would only increase faith of the common man on Government.
Spread across 116 districts[ii] of six states, consisting of Uttar Pradesh, Bihar, Jharkhand, Rajasthan, Odisha and Madhya Pradesh, PMGKRA scheme is meant for around 67 lakh migrant workers. As part of this project, the Central Government is expected to spend Rs 50,000 crore over the next 125 days on a ‘Mission Mode’ to develop ‘Durable Rural Infrastructure’ by optimally using the rural migrant workforce and their skill-sets for the same.
Prime Minister Modi in his speech while inaugurating the project also mentioned about ‘Skill Mapping’ that would be done to make sure that the migrant workforce who had returned from cities due to the pandemic would be engaged in a kind of work that is in sync with their inherent skill-sets. It was also mentioned that, the ‘The Program will also prepare for expansion and development of livelihoods over a longer term’[iii].
Explained: The Nuances of PMGKRA
In fact, Pradhan Mantri Garib Kalyan Rojgar Abhiyan (PMGKRA) is a critical part of PM Modi’s Aatmanirbhar Bharat Abhiyan, which strives for productively employing the migrant workforce in creation of durable assets in rural India in areas like construction of houses for rural poor, plantations, development of provisions for drinking water, Panchayat Bhavans, community toilets, rural mandis, rural roads, cattle sheds and Anganwadi Bhawans, poultry farming, laying of fibre optics and cleaning of river Ganga to name a few. As per reports, PMGKRA has already created 59.8 million workdays in rural during in the last three weeks since its inception across 25 major schemes[iv]
Why PMGKRA is Better than MNREGA
It is also important to mention that PMGKRA is far better than MNREGA since the latter has consistently failed in durable asset, or infrastructure, creation in rural India. Further MNREGA, a brain child of UPA, never gave importance to skill mapping or skill development, and whatever little assets were built under MNREGA always had questionable structural strength or productivity enhancing capability. Even UPA ministers like Jairam Ramesh had acknowledged in 2013 about the failure of NREGA in creating assets[v]
Ideally, Pradhan Mantra Garib Kalyan Rojgar Abhiyan (PMGKRA) should eventually replace MNREGA since it is equally important to create durable assets as much as rural employment. If the former is not created to sustain the latter, then any such scheme ends up becoming a disguised unemployment generation scheme. That has been the consistent legacy of MNREGA.
The Road Ahead: From PMGKRA To Atmanirbhar Rural India
On a larger frame, what the Modi Government has attempted to do in terms of managing the pandemic related crisis for mitigating the challenges of rural people and migrant work force, is a combination of short term measures to deal with the immediate issues of provisioning of food items and employment scopes for taking care of the short term requirements, while also seizing the moment of crisis to convert it into an opportune time for implementing some of the much needed structural reforms that are aimed at rooting out the systemic flaws that for long inhibited the growth and development of rural India. In short, the larger strategy is to make sure that in future people don’t need to desperately migrate from rural India to seek jobs in urban clusters.
The Policy Measures for Making Rural India Aatmanirbhar
It is expected that many of the rural economy related structural reforms such as amendments to Essential Commodities Act approved by Union Cabinet[vi], creation of Rs 1 Lakh crore Agri-Infrastructure Fund[vii] for development of agriculture infrastructure projects, allocation of Rs 15,000 crore for Animal Husbandry Infrastructure Development Fund[viii] for facilitating investments in dairy industry and cattle feed infrastructure, proposed legislation to create a new legal framework in the realm of agricultural produce marketing to give freedom to the farmer to sell his produce at remunerative price to anyone of his preference through a creation of a barrier-free inter-state trading architecture, proposed creation of a new e-trading framework for agriculture produce, proposed creation of an enabling framework to make farmers transparently and seamlessly engage with retailers, aggregators and exporters, move to give FSSAI certification to around 2 Lakh micro food enterprises, to name a few, are collectively expected to unleash a new wave of rural growth and job creation.
The MSME Push and its Impact on Rural India
It is also important to mention the specific schemes announced for the Medium, Small and Micro Enterprises (MSME) sector and how it would benefit rural India. Changes in the definition[ix] of the MSME has been aimed at giving entities more lateral space to grow and become competitive by producing in large quantity to leverage economies of scale. This apart, provisions for collateral free debt, corpus for equity investments in MSME as well as restricting all government procurement tenders up till Rs 200 crore for domestic companies only, would have a major impact, in a chain reaction, on not just urban based MSMEs but also rural based MSMEs.
It has to be remembered that almost 66 % of all the Micro Food Processing Enterprises[x] are based in rural India while surprisingly more than 50% of India’s net value addition in manufacturing sector[xi] comes from rural India. Yet, it is for lack of institutional support mechanism, lack of capital investments, which could have helped them to grow, that they could never expand, remained small in size, and thus have often fallen short of creating the requisite job opportunities on a continuous basis that would have prevented systemic migration of rural work force to urban clusters. It has to be remembered that India has more than 63 million MSME units, a considerable proportion of which are in rural area.
Now with the creation of the above mentioned schemes, it is expected that in the medium term, a considerable number of jobs would be created in rural India that would make sure that rural workforce are not needed anymore to desperately shift to urban India in search of either permanent or seasonal jobs.
Take for example the ‘PM Formalisation of Micro Food Processing Enterprises’[xii]. This scheme which is expected to eventually generate investments to the tune of Rs 35,000 crore has the potential to create nine lakh skilled and semi-skilled jobs through benefits that would accrue to around 8 lakh food processing units through access to ‘information, training, better exposure and formalisation’[xiii].
Interestingly almost 80% of the rural based micro food enterprises are household enterprises. If they eventually expand with the help of the institutional support mechanism being proposed by Union Government, such as, ‘handholding support for farm level upgradation plan, Detailed Project Report (DPR) preparation, Skill training, obtaining bank credit, FSSAI/ local body license, Udyog Aadhaar’, as well as ‘brand building, linkage of clusters with lead buyers, technology upgradation, entrepreneurship development, development of new products and processes’[xiv] to name a few, then it is expected that they would eventually expand resulting in rural job creation which if it happens in large scale would prevent migrations. One then would not even need government support for employment generation but rural India would create enough jobs for its own lot and others.
It is also expected that agriculture reforms, mentioned earlier, would similarly make agriculture more remunerative in the coming years resulting in more disposable income for the rural lot and which in turn would make sure that migration does not happen to that extent in urban clusters in future as has happened till now.
India’s Resurgence: Like a Phoenix Amidst a Crisis
No one can deny that the world, and not just India, is going through some extremely rough patches due to Covid-19 pandemic related economic crisis. While no doubt that this phase, in spite of its torment, has also pushed the Indian economy to become more resilient and vindicated its structural salience, it was important that the Government made sure that the poor are assured of the bare minimum necessities, through provision of food and work, to tide through the phase.
PM Modi led NDA Government, after empowering rural India through Jan Dhan Yojana, Direct Benefit Transfer, PM Kisan and Ujjwala Scheme, has once again assured the marginalised sections of unflinching support from the Government through these rough times.
An Ideal Step Forward: Replace MNREGA with PMGKRA
While there is no doubt that in the next few years, rural economy would become thriving enough to create jobs in large scale and unleash a new generation of entrepreneurship, it would nevertheless be a great idea to eventually replace MNREGA with PMGKRA since the latter is far more dynamic and holistic in its approach and is aimed at not just creation of productive man-hours but also durable assets for rural India that are so very needed for creation of Gram Swaraj in its truest sense.
Endnotes
[i] Refer to article published in The Economic Times, on July 8, 2020, https://economictimes.indiatimes.com/news/economy/policy/cabinet-nod-for-extension-of-pmgkay-for-5-months-till-november/articleshow/76855664.cms?from=mdr
[ii] Refer to article published in Hindustan Times, in June 2020, titled ‘PM Modi launches Rs 50,000-crore Garib Kalyan Rojgar Abhiyaan’
[iii] Refer to Press Release by Press Information Bureau, published on June20, 2020, https://pib.gov.in/PressReleasePage.aspx?PRID=1632861
[iv] Refer to article in newsonair.com of All India Radio, http://www.newsonair.nic.in/News?title=PMGKRA-has-created-59.8-million-workdays-across-25-schemes-in-rural-India-over-3-weeks-during-lockdown%3A-Prakash-Javadekar&id=393514
[v] Refer to article published in Financial Express, titled ‘NREGA failed to create durable assets: Jairam Ramesh’ published in December, 2013, https://www.financialexpress.com/archive/nrega-failed-to-create-durable-assets-jairam-ramesh/1208421/
[vi] Refer to article titled, Govt okays amendment to Essential Commodities Act, published Live Mint, in June 2020, https://www.livemint.com/news/india/govt-okays-amendment-to-essential-commodities-act-11591207753320.html
[vii] Refer to article published in The Economic Times, published on July8, 2020, https://economictimes.indiatimes.com/news/economy/agriculture/govt-decided-to-set-up-an-agri-infrastructure-fund/articleshow/76854880.cms
[viii] Refer to article published in The Economic Times, published in June 24, 2020, https://economictimes.indiatimes.com/news/economy/policy/government-approves-rs-15000-crore-animal-husbandry-infra-development-fund/articleshow/76563252.cms?from=mdr
[ix] Refer to article published in The Times of India,
[x] Refer to Press Release by Press Information Bureau, published on 29th June, 2020, https://pib.gov.in/PressReleaseIframePage.aspx?PRID=1635088
[xi] Refer to article published in Live Mint, in November, 2017, https://www.livemint.com/Opinion/amEFrnhIeOhL224XdoV1rJ/The-rural-economy-is-not-just-about-farming.html
[xii] Refer to article published in The Economic Times, https://economictimes.indiatimes.com/small-biz/sme-sector/govt-launches-pm-fme-scheme-to-help-micro-food-processing-enterprises/articleshow/76691514.cms
[xiii] Refer to article published in ruralmarketing.in titled, ‘All you need to know about newly launched micro food’
[xiv] Refer to Press Release by Press Information Bureau, titled Cabinet approves “Scheme for formalisation of Micro Food Processing Enterprises (FME)” published on May20th, 2020. https://pib.gov.in/PressReleasePage.aspx?PRID=1625320
(The Author is a New Delhi based Policy Analyst & Television Panellist. The Views expressed are personal.)
Image Source: narendramodi.in
