Written by Yoginder K. Alagh | Updated: July 10, 2020 9:26:39 am Statements emphasising that in a downturn economy, local labour will fill the gap, simply ignore the cycles in the demand for labour. (Illustration by C R Sasikumar)
Migrants, very often, get an undeserved bad name in our market economy. However, in Indias not very old experience, and in the process of development generally, as migration plays a major developmental role its careless and somewhat irresponsible to downplay the role of migrant workers. Statements emphasising that in a downturn economy, local labour will fill the gap, simply ignore the cycles in the demand for labour. We in the cities, after all, will have to worry about our needs whenever the M or the W-shaped swing takes place.
In the Seventies of the last century, the economist K N Raj, a guru to many of us, brought the importance of migrant labour to our attention. Raj, an example to many of us, worked in India for most of his career. But at that time, certain compelling personal reasons led him to work with the UN. He chose to go to the ILO and set up the ILO ARTEP an Asian Regional Employment Programme. There Raj brought to our notice the historical role of migration in Japans development. He propagated the work of the eminent Japanese economist Kaoru Ishikawa. Ishikawa had shown that labour migrated to those Japanese prefectures which were growing fast economically, including agriculturally. Diagrammatically, if you plotted output per unit of land against labour per unit of land, you got an inverse relationship in a rectangular hyperbola. If agricultural productivity went up, more labour was sucked into the prefecture. Much like migrant workers from UP and Bihar going to the Green Revolution belt.
Raj wanted to test Ishikawas hypothesis in India. He asked me, G S Bhalla and Amit Bhaduri to do this job. He knew me because he was a great admirer of my patience in selecting younger people at the Centre for Development Studies in Thiruvananthapuram and holding my own against some of the bigwigs of the institute who tended to be very formal.
I had co-authored a book with Bhalla on district-level agricultural experience and had a lot of data. Over many rounds of analysis and discussions, Bhaduri kept on saying that this business was a truism. At one stage, a little fatigued, I had to tell him: We dont want to work with falsisms, do we? Lets go ahead. This was the origin of the, by now, well-known Alagh, Bhalla and Bhaduri thesis. Our paper proved that there was indeed a suction mechanism in Indian agriculture.
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Not satisfied, Raj organised a set of seminars on the issue in different parts of India. At Bengaluru, D T Lakdawala, the then deputy chairman of the Planning Commission chaired the meeting. D M Nanjundappa, chairman of the Karnataka State Planning Commission, said that if instead of irrigation pumps we had the old buffalo driven wheels and water was lifted by buckets, employment in well irrigation would be higher. Bhalla, a Marxist by inclination and very critical of what he thought were ante-diluvian ideas, responded that if we do irrigation with spoons, employment would be even higher. Nanjundappa protested that Bhalla is making fun of him. Lakdawala, the great liberal, doused the fire.
Later, the ILO economist of Pakistani origin, Rashid Amjad, published a book that talked about the similar experience of migrant workers in several other countries, making the Ishikawa hypothesis a universal theory endorsed by the ILO. Labour migration as a serious policy issue had arrived.
In this century, as the different globalisation crises hit us, Iwan J Azis, the Indonesian economist who held positions at the Cornell University in the US and the National University of Indonesia, and I looked at reverse migration. Azis showed that the Southeast Asian economies were chugging along at 6 per cent plus growth when the SARS outbreak hit the region. The Thai baht lost half its value in a few days. The contagion was a lot like the later viruses. In a few months, many countries lost upto a third of their wealth. India, I showed, fared better because it was a relatively closed economy.
Azis showed that there was reverse migration. The migrants went back to their villages where they did not have to starve. They had picked up skills in the cities which helped them initiate agro-based development like diversification away from rice in Indonesia. The experience was similar in Philippines and Vietnam. Migrants were regarded as an asset.
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At a dinner in Delhi, I was made to sit at the head table with the then Prime Minister Atal Bihari Vajpayee. I had written to him to get the meltdown in Surat looked into. He turned to me and said, Alagh saheb, sab theek hain (Everything is all right). I didnt have the heart to complain.
Migration has always been a shock absorber. It is this role we choked off by regional lockdowns and transportation blockages, causing enormous suffering and many deaths. I get disturbed when some very eminent colleagues recognise the uncertainty of the situation and yet choose livelihood over life. A filled up belly may starve. But the dead wont come back. This is not the empirical welfare economics my teachers many of them Nobel Prize winners taught me. Good economics doesnt make careless choices between life and death.
We have now, hopefully, learnt from our mistakes. Today, many of the migrants may say that they will never come back. But once opportunities are there, they will return. Until then, it is not quite kosher to stop them from going home under pressure from builder lobbies. The market should be allowed to work for both industry and labour.
In fact, the reverse migration could bolster the agricultural sector in the short-run. We should integrate the process of reverse migration with agro-based development in the short-run and wait for the migration back to cities as we get out of this disaster.
This article first appeared in the print edition on July 10, 2020 under the title Wait for the migrant. The writer, a former Union Minister, is an economist.
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