State of India’s Livelihoods 2014

Sankar Datta, Ashok Sircar, Suryamani Roul, Srinivasan, Manas Ratha, Vijay

Mahajan

Overview

• Workforce shifting away from agriculture• NREGS and construction create more jobs – but

of low quality• Economic growth seems “jobless”• Per capita income increases – so does disparity• Climate change challenges – high impact on poor• New hopes from national skills programme

Policies and Programmes

• Policy paralysis to haste? Several bills passed quickly – two pending (Mining, biosecurity)

• The new Budget continued several past programmes• Silent on key issues affecting livelihoods of about 500

million people• Apprentice Act, youth policy - focus on youth• New poverty line – who is below is the larger

question – not how to lift them up• Labour law changes mooted• Changes to NREGS in the offing• NRLM – org aspects require strengthening• Revamp of POP required

Livelihood finance• 50 million farms and 35 million MSMEs have no access to

banks• Farm credit flow skewed in favour of south and north• Gaps in products offered – not aligned to livelihoods• Banks lose in small loans – borrower costs are still high• Affordability of credit costs in farming is a question – but are

subsidies in credit the answer?• Subsidies and waivers distort markets and livelihoods –

erode viability of financial institutions• Some isolated successes in providing livelihood finance • Financial inclusion has to go a long way before impacting

livelihoods• Fixing real sector – key to viable livelihood finance

Corporate Social Responsibility

• Potential funding of Rs 15000 to 20000 crore• Livelihoods is a focus area for CSR spendsCompanies can focus on

Developing skills and capacities in peopleCreate/support livelihood institutionsAsset creation to facilitate livelihoodsProductivity enhancementRisk managementMarket access facilitation

What benefits people, What benefits the company - and the area of overlap best suited for CSR spend

Farmer Producer OrganisationsPractitioners View

Farmer loyalty to PO diminishes as price gains decline over time

Tensions in mixed membership – large and tiny farmers

POs to be built on cooperatives / groups rather than on primary individual membershipPatience with sustained work for org maturityRisk capital and patient capital neededLegal changes needed

Farmer producer organisation

• Legal space created for true livelihood organisations – but changes needed

• Leveraging farmers’ equity to build large business with market access for members– POs are in to first few links of value chains– Management deficit a critical constraint– Risk capital and bank loans hard to come by despite several

schemes by government, NABARD, etc.

Comprehensive early stage funding requiredCapital and capability have to work together in harmony in building up FPOs

THANKS