Creating Decent Livelihood Opportunities in Rural Areas

A Non Traditional Approach

Dr. Ramesh Chandra Srivastava

Former Vice Chancellor, Dr RP Central Agriculture University, Pusa, Samastipur, Bihar

The question of providing decent livelihood opportunity has occupied a centre stage in development policy debate in India and across the globe in recent years. In the Indian context, improving the quality of employment, in terms of rising wages and access to social security, was considered an important concern of state policy. Despite such concerns, the progress on the front of employment generation has been mixed one. There exist significant inter-regional and intra-regional differences in employment outcomes in India particularly witnessed along with a consistently high rate of economic growth. Besides quantity, the quality of employment is a major challenge, which is critical in achieving economic and social development across different regions of the country. Migration of unskilled and semiskilled persons in search of casual employment from rural areas to urban areas has become a huge problem both social problem in rural areas as well as increasing load on urban infrastructure. The lack of decent livelihood opportunities in rural area has led to higher poverty, about 25% more than that in urban areas. The difference in different economic regions is more stark in eastern U.P. and Bundelkhand region. Thus it is essential that decent livelihood opportunities are created in rural areas itself.  A major challenge of creating decent livelihood opportunities in rural areas is low level of  skills in rural workforce if we depend upon traditional manufacturing sector to create large scale livelihood opportunities. Thus to foster growth with a focus on employment, there is need to focus on non traditional non-farm employment opportunities, and encourage entrepreneurship.

With this in view, a model was conceptualized by Dr. Rajendra Prasad Central Agricultural University, Pusa, Samastipur, Bihar under leadership of then Vice Chancellor Dr R.C. Srivastava. Originally this concept was visualized to provide LPG gas refill to Ujjawala program beneficiaries in particular and villagers in particular in lieu of them providing 20 kg of cowdung daily. A cattle is an integral part of any farm household in India and thus cowdung was an input available with almost every household. This concept materialized in Sukhet village of District Madhubani (Bihar) with collection of cowdung and household waste everyday at farmers’ doorstep, collection of waste vegetation from village viz., water hyacinth etc, converting this waste in vermicompost at compost yard, sell of vermicompost to local farmers, and finally utilizing the sale proceeds to provide LPG refill to households who contributed 20 kg cowdung daily. A distinct characteristics was no cash transfer but a barter with refill of LPG gas. The concept is explained in following figure:

 

 

While implementing this model it was  found that this model fulfils four objectives instead of only one which was initially thought of. (i) Providing LPG refill every 2^nd month to contributing household; (ii) ensuring sanitation in rural areas as collection of cowdung at doorstep of family also collected organic household waste; (iii) Providing organic manure at doorstep of farmers practising organic farming ; and (iv) providing employment to FOUR unskilled youth and one educated youth. This model got traction in both local and national media. It also got attention of Hon’ble PM who mentioned it in his Man Ki Bat in 80^th episode on 29^th August, 2021. Few links:

http://www.outlookinida.com/outlook-spotlight/monetization -of-cow-dung-a-novel-initiative-of-rpcau-news-390483 ; What is the 'Sukhet Model' of Madhubani praised by PM Modi during Mann Ki Baat? Find out here! (youtube.com)

Hon’ble Prime Minister had suggested that each panchayat should adopt this model. Let us examine its potential with reference to U.P. which has about 2.38 Cr farm families, out of which about 2 Cr farm families have registered for Kisan Samman Nidhi. With cattle population being 8.33 Cr, average number of cattle per family is four, which is much more than one required for this model. To keep operation easy, it has been proposed that there should be one unit for 100 farm families. Thus the state will require about 2 lakhs units to cover whole state. If implemented in whole state, this will generate 8 lakhs unskilled jobs and about 40000 skilled job assuming that skilled man required for accounting and sale will cover 5 units. The estimated capital cost for putting up one unit consisting of Vermicompost yard, Garbage yard, few small machineries for chaffing, sieving, hand cart etc will be about 15 lakhs per unit and annual operating expenditure will be about 14 lakhs which include salary bill of 7.7 lakhs (Rs 15000/- p.m. for four unskilled staff and 1/5^th share of skilled staff @20000/- p.m.), 6.0 lakhs towards cost of six LPG cylinders @Rs 1000/- per cylinder (without any subsidy) annually for 100 farm families and rest as contingent expenditure. The annual return will be 250 t of vermicompost which can be sold at rate ranging from Rs 6000/- to Rs 8000/- per tonne (retail rate of vermicompost varies from Rs 12  for 30 kg bag to 15 per kg for 10 kg bag). Thus expected revenue will be between 15 lakhs to 20 lakhs per unit per annum. Thus this enterprise will be economically viable. The way for upscaling this concept on national level is presented below:

Roadmap for implementation of this plan

If implemented in whole state, this will require a capital investment of Rs 30000 Cr and provision of 28000 Cr of operating expenditure for first year at least.  The capital expenditure can be spread over 3 or 5 years to cover whole state. This investment can come from two routes: Pooling budget from MANREGA, Swachh Bharat Mission and Organic farming Project. About 70% funds for capital expenditure can be sourced to MANREGA as about 60% is allowed on material cost and rest as labour cost. 20% of it mainly on handcarts, dustbins, and other small implements can be sourced to Swachh Bharat Mission and rest 10% mainly expenditure on earthworms and other petting contingent items can be sourced to Organic farming mission/ Paramparagat Krishi Vikas Yojna/ Rashtriya Krishi Vikas Yojna. The operating expenditure can come from low  cost debt from NABARD with 2 year moratorium and the interest  being paid by state government during first two years. The subsidy presently given to LPG cylinder can be used for subsidizing price of vermicompost for at least 3-5 years which will make sale attractive.

The other route to supplement MANREGA route can be through MSME, where every unit will be given 25% subsidy on capital cost and other 25% will be owner contribution and rest 50% soft loan. The operating cost for first two years will be low cost lending from NABARD secured by government with two year moratorium during which interest will be paid by government. This money can be paid from savings on subsidy for LPG cylinders or subsidy on organic farming.

Quality control

The maintenance of quality parameters will be key for success of this program. This can be achieved by random sample collection and its testing at district level. Two options can be used for this: i) Strengthening district level soil testing labs to do this OR/AND ii) establishing/ strengthening existing soil testing facility at district KVK. The lab should have a vehicle at its disposal through which samples will be collected at random and tested vigorously so that users have faith in product. The expenditure on it can be met from regular budget of department of Agriculture

Administrative Setup

 The whole system can be managed in a corporate fashion by creating a corporation at district level. Following is line diagram of administrative set up for implementation of program.

It is evident from above that the system is economically viable, has huge employment potential with just diversion of a part of funds from existing schemes.