Livelihood in Madhya Pradesh

Saharia Tribal community inhabits seven districts in north-east of Madhya Pradesh. The Government of India has categorized this community as backward scheduled tribe. Today, there is constant reporting of untimely deaths, due to food insecurity, from this very community. The ancestors of Sahariya Tribal community of the region were having a closely knitted bondage with forests.  Their life-style, festivals, sense of confidence and livelihood sources, were all linked with forests.  About 50 years back, forests were the only source of livelihood for their families.  During the decade of 1960, the Government resorted to maximum exploitation of forests in the name of development. Consequently, in about 20 years time, this area used to be otherwise full of forestry, was rendered without any trace of forests.  After 1980, stone mining activities started in this area and as a result soil-base of the ground was reduced to nil. The respective contractors resorted to heavy exploitation right from forests to land areas and to encourage their activities; the Government has framed policies suitable to their interests. First, the de-forestation was encouraged and thereafter, in the name of protecting the forests, these Tribals, who were living there for ages, were being branded as ‘encroachers’ with ultimate objective to move them out of forest area.    

In such a scenario, the very question of livelihood started gaining importance.  Through the policy of development, being adopted by the Government, only a particular section of society was able to enjoy the access over the available resources as well as to establish permanent sources of livelihood for themselves.  In the process, a vast majority comprising of almost two-third of population was left to face total insecurity in terms of their livelihood.   During the last 25 years, the priority of Government had shifted from basic sectors like Agriculture, Forest produce, Animal husbandry and fisheries, which provided large-scale employment to a vast majority of people, to industrial and service sectors. Although this policy level shift increased the money circulation, but reduced the employment opportunities. In the year 1956, the State of Madhya Pradesh came into existence and although there was three-fold increase in terms of GDP, but the unemployment was also more than tripled from 7% to 23% during this period. 
The total monthly expenditure of 63.3% of families in Madhya Pradesh is Rs. 775/- per person and according to one analysis; this amount is sufficient only for two times meal in a day.  Other human requirement like health, education etc., cannot be met out of this amount.  The condition of rural areas is still worse, where 93.9% families are able to spend even less than Rs. 775/- per month per person.  

Status of expenditure in Madhya Pradesh (Out of 1000 Persons)

In Urban Areas

In Rural Areas

Expenditure per month/

Number of persons

Expenditure per

Number of persons

person (In Rupees)

(Out of 1000)

month/person (In Rupees)

(Out of 1000)

000 - 300


000 - 225


300 - 350


225 - 255


350 - 425


255 - 300


425 - 500


300 - 340


500 - 575


340 - 380


575 - 665


380 - 420


665 - 775


420 - 470


775 - 915


470 - 525


915 - 1120


525 - 615


1120 - 1500


615 - 775


1500 - 1925


775 - 950


More than 1925


More than 950






(Source: NSSO Report No. 560, year 2004 – Status of employment in India)

10th Five-Year Plan:

At the planning stage for 10th Five-year Plan, since there were stocks of 620 lakh tons of food grains in the go-downs and as such, the Government had declared that India is self-sufficient for meeting its food requirement.  In the meantime, a bare analysis of Government’s one of the most ambitious plan – Employment Guarantee Scheme, reveals that as against guaranteed 100 days employment in a year, the members of rural families are actually getting employment hardly for about 8 days in a year.  During this very period hunger deaths were being reported from various parts of Madhya Pradesh.  Therefore, the Government of Madhya Pradesh had decided that ‘Removal of Poverty’ shall be its prime objective during the 10th Five-year Plan period. But in fact instead of complete removal of poverty, the objective remained only to reduce the gap of poverty prevailing between National and State levels1.   Such an objective can even be achieved by increasing the level of National poverty – whether the State Government was prepared for this? 
Obviously, in the given scenario, the question of livelihood had to be analyzed from social as well as political angles. Also, the livelihood and employment had to be viewed independent of each other. To clarify it further, under employment, a person gets work as provided by its employer at a certain work place and fix remuneration is paid in return of labour put-in, but it lacks any permanency, security and rights over resources.  In all developmental processes, we only talk about increasing the employment opportunities, but for human development, right to livelihood is of prime importance.

To give a permanent definition to livelihood, it had to be viewed more from human angle as against the present economic/poverty basis.  For removal of poverty strategy can be built around sources, activities, entitlements, resources etc., but in terms of resources, not only water, forests and land is included but it also involves social relations, participation in power and freedom to use knowledge and competence.

It has been observed in today’s political system that although communities are being empowered with various rights, but they are being made bereft of any energy or capability to utilize such rights. In today’s perspective, the right to livelihood remained limited only to the extent of right to employment and almost each and every natural as well as human resource, has been brought within the ambit of Government authority and control by enactment of various laws.  As such, the decrease in quality of 1 Source:  Madhya Pradesh - Summary of salient features of 10th Plan – 2002-2007

life due to constant violation of livelihood rights can be well realized.  The problem of livelihood is not because of any loss of capability or competency of the people, but just because of lesser opportunities to perform they are losing their inherent competence and are forced to lead an uncertain and insecure life.

Assessment of Unemployment:

The status of unemployment is assessed and analyzed through the data available from the Employment Exchanges of respective States.  In view of the restrictions imposed against any new recruitment in public sector units and thus in the absence of any new employment opportunities, no useful purpose will be served by continuing with the Employment Exchanges and as such, it was decided in 2004-05 to close them. But the list of unemployed persons is quite long and irrespective of whether they are of any productive value or not, they definitely constitute political importance.  Therefore, instead of closing the Employment Exchanges, they were merged with the Department of Commerce & Industry. Probably, it was in-principally accepted that employment opportunities would be generated only in industrial sector and nowhere else.  Perhaps for this very reason, the Employment Exchanges remained limited up to serving the industries only.  Up to the year 2005, the number of people registered with the Employment Exchanges in Madhya Pradesh was 21.18 lakhs, while in the year 2004 this figure was 20.29 lakhs, marking an increase of 89,000 in a year’s time.

Looking at the educated unemployed, it clearly reflects upon as to at what pace our existing education system is distancing itself from competence, capability and sources of livelihood.  Out of total registered unemployed, 16.71 lakhs (78.90%) of them were listed as educated unemployed.  

In Madhya Pradesh, unemployment is fast increasing both in organized as well as unorganized sectors.   The main reason, which can be attributed to such phenomenal increase, is the shrinking of public sector and as far as unorganized sector is concerned, it is influenced by privatization and economic reforms.

A total of 5,29,274 employees were working in various Government units during the year 2000, in Madhya Pradesh, which were reduced to 5,04,8632 in 2002 and 4,98,929 in 2003. Thus, there is constant fall of employment opportunities in Government run units.    
Looking at public sector in totality, it reveals that the number of employees has been reduced to 9.20 lakhs in the State, out of which 1.23 lakhs are women.  Thus, there is fall in employment by 2.01% in this sector3.

Going back by 30 years, between 1975 and 1980, the employment in this sector was increasing by 2.87%, and number of employees were 10,97,584, which now stands to reduced by (-) 2.01%4**.

Status of Employment in the State:

In present day scenario, almost 66 lakhs of people of Madhya Pradesh are in search of employment. Here, about 15 lakhs people are working in organized sector and remaining 94% of working population is engaged in unorganized sector – basically in their traditional occupations like: leather work, forestry, Bidi manufacturing, slate-pencil industry, cloth-dari manufacture, construction work, domestic 2 Source:  Statistical summary of Madhya Pradesh 2004 - Department of Economic & Statistics of State Government 3 Source:  Economic Survey of Madhya Pradesh 2005-06, Dept. of Finance, Government of Madhya Pradesh 4 Source:  Economic Survey of Madhya Pradesh 2005-06, Dept. of Finance, Government of Madhya Pradesh workers etc.   The population of Madhya Pradesh is increasing by 13 lakhs per year and according to  Human Development proposal, submitted by the State Government, 10 lakh new employment opportunities have to be created every year.  It is not disputed that GDP of the State has been increased and rate of development also remained between 5 and 6%, but it is also a fact that increase in employment opportunities has touched its all time low at 0.9% in the State.  The opportunities in public sector are almost nil and as such, private sector is being encouraged to compensate for it, but the problem is that private sector is just not capable of meeting the employment needs. The Human Development Plan of the State Government clearly reflects on the uncertainty of employment.  It reveals that in 2001 about 2.96 crores of people were in need of employment, which number will increase to 4.4 crores by the year 2020 requiring 1.8 crore new opportunities to cope with the situation. Therefore, the Government has to adopt pro-employment policies and plans instead of those by which only the development rate is increased but people do not get jobs.

Status of employed families in Madhya Pradesh (Out of 1000 Families)

Sr. No

In Urban Areas

In Rural Areas


Self Employed


Self Employed 1.Agriculture – 454 2.Non-Agriculture - 98



Regular wage / Salaried


Agriculture Laborers



Irregular workers


Other Labour Families







Total in Urban areas


Total in Rural areas


(Source: NSSO Report No. 560, year 2004 – Status of employment in India)

Apparently, there is vide disparity in the means of employment between urban and rural areas.  While in urban areas, about 41.8% people either belongs to self-employed or salaried class, but in rural areas 73.1% families are engaged either directly with agriculture (45.4%) or are working as agriculture labourers (27.7%).

Livelihood and Agriculture in Madhya Pradesh:

Geographically, Madhya Pradesh is forming a part of Central India.  Climatically, it neither suffers from scorching heat nor faces the cold waves.  It is also away from oceanic typhoons.  Still the various communities of this State are fighting the grim battle for their livelihood.  As per Census of 2001, the population of Madhya Pradesh is 603 lakhs, out of this 257 lakhs (42.57%) is working (employed) population, which includes 110 lakhs engaged in various agriculture related works and 73.80 lakhs are agriculture labourers.

The aforesaid statistical data clearly establishes that agriculture is the main source of livelihood in the State and as such, it needs specific attention.  In 1960-61 the average land holdings with farmers were 4.1 hectares, which stands reduced to 2.3 hectares in 2005.  The cost of production had increased by 130% during last 15 years, but on the contrary, market price of agricultural products had increased only by 60% and that of minimum support price by 50%.  Clearly, the financial burden on farmers had increased. With decreasing profitability on their produce, the farmers become indebted and as a result thereof, almost 50% farmers of State are indebted by an average amount of more than Rs. 11,000/-. The situation needs a fundamentally basic change.  Although the agriculture sector contributes about 23 to 27% in the GDP of the State, but the fact cannot be lost sight of that food production had increased from 101 lakh tons in 2000-01 to 135 lakh tons the very next year in 2001-02 and now it stands at 158 lakh tons. Thus the State is producing at 249 Kgs. of food grains per person for its people and despite the economic problems, it is attempting to meet its food requirement.

Even today the farmers of Madhya Pradesh are dependent upon monsoon.  Two crops in a year are taken only from 24% of agriculture land, while remaining 76% of land is able to provide one single crop only. In the year 2003-04, due to good monsoons, the food production increased by 39.92% as compared to previous year (2002-03), but immediately thereafter, in the next very year, in 2004-05 the production was reduced by 3.47%. This much of fluctuations had its direct impact over the lives of 2 crores of people, who are directly dependent upon agriculture.  The big challenges being faced by the agriculture sector are small land holdings, lack of irrigation means and low fertility of land.

Agriculture and commercial crops:

As a matter of policy, cash crops are being encouraged in Madhya Pradesh.  Preference is being given to crops like Cotton, Sugar cane and Soya bean. Out of total agricultural production, soya bean contributes about 18.07% in the State.  Sugar cane is being produced in 73,613 hectares of land and cotton in 6 lakh hectares.

Forests and sources of livelihood:

About 19% of population comprises of Tribal (Tribal) community in Madhya Pradesh and a total of 22,600 villages are either inside the forest area or are bordering forests.  Traditionally the Tribal community depends upon forests and its produce for their livelihood.  It is a fact that most negative impact of Forest & Environment Policy as well as that of Industrial policy, falls upon 1.14 crore Tribals and 90 lakh scheduled tribes living in the State.  The otherwise extensive rights of these communities were reduced to a very limited extent.  Presently, the storage of small forest produce is being done by Small Forest Produce Committees.  Storage and distribution of such produce is the main responsibility of these Committees.  There are 1066 primary Small Forest Produce Committees and 60 District Small Forest Produce Unions are functioning in the State.  Here, Tribal community has been permitted (but not as a matter of right) to store the non-nationalized forest produce, like Chiraunji, Honey, Mahua, Anwla and other products of medicinal value.

Now a new policy has been adopted for Tendu Leaf. In the year 2004, regional tenders were invited for trading in Tendu Leaf. The respective contractors collect Tendu Leaf from Primary Forest Produce Committees and store them.  16.71 lakhs of standard sacks of Tendu Leaf was collected during 2005, out of which 13.34 sacks were sold for a total amount of Rs. 104.52 crores.

Animal Husbandry:

Animal husbandry is also a big source of livelihood in Madhya Pradesh.  There are vast opportunities for increasing the animal wealth in the State.  In 1997 it was 3.49 crores which was increased to 3.56 crores in the year 2003. The number of cows and other animals of buffalo breed are 1.23 crores. During this period (1997-2003), the number of cocks and ducks were increased appreciably and thus the total animal wealth has been increased from 72.61 crores to 117.06 crores.

Fishery production

The number of dams and reservoirs has been increased quite appreciably.  Out of total watery area of 3 lack hectares in Madhya Pradesh, fishery production is being done in 2.92 hectares of such area.  So far the policy was to encourage and provide opportunities for fishery production to members of community and rehabilitated families, but looking at profit margin in this trade, the influential groups of private sector are also pitching in here.

Industrial Sector

The expansion of industrial base has become an important part of developmental strategy. Government believes that the right to exploit natural resources should not remain limited with community alone, because it restricts the market expansion and a large section of consumer turns into producer-cum-consumer.  Till now, complicated process was involved for establishing an industry, but single-window system has been introduced now to facilitate such process for the aspiring industrialists. However, it is a different matter that a poor person has to move around at many places for getting his ration card. 
The Government has also made a provision of Rs. 140 crores for establishing a Special Economic Zone. Under the Factory Act of 1948, the number of registered industries in the State was 8.2 thousand in 2005, generating an average daily employment of 3.97 lakhs.  A year ago, 3.95 lakh people were working in these industries, thus only 2000 employment opportunities were created during the whole year. Such industries mainly include Agricultural related services, Manufacturing of food and other alcoholic products, Cotton clothes, Chemicals and chemical products, Raw and mixed metal industry, raw mining products, manufacture of metal products and its parts, electric machines and its parts.

Steps taken at Government level

To overcome the problem of livelihood or to say unemployment, the Government is attempting to solve them through its temporary plans.  In almost every plan, aimed to eradicate poverty, efforts are directed towards creating more and more job opportunities.  Such plans are being implemented mostly in rural areas because 73.1% of agriculture-based population there is already suffering for loss of agricultural productivity.

In co-operation with World Bank, the District Poverty Eradication Plan is being implemented in 14 districts of Madhya Pradesh. Under this Plan, groups consisting of poor and deprived people have been made and financial assistance is being extended to such groups.  A total of 2.9 thousand poverty-ridden people of 21 blocks are included in this Plan.  However, it appears that this plan is being implemented without any consideration of other aspects of the problem like social-political exploitation and violence against women folks.

Swarn Jayanti Gramin Swa-rojgaar Yojna (SGSY) is being implemented with a perspective to promote and generate self-employment opportunities.  2.33 lakh Self-Help Groups (SHGs) have been formed under this scheme5. As per statistical data of the Government, the number of beneficiaries under this scheme includes 11.68 thousand Dalits, 15.29 thousand Tribals, 22.90 thousand women and 1.24 5 Economic Survey of Madhya Pradesh 2005-06, Dept. of Finance, Government of Madhya Pradesh 
thousand disabled persons. Although the very objective of the scheme is to generate self-employment opportunities for the poor people, however, no steps appear to have been initiated for shifting the market trend towards pro-poor to encourage such self employed people.

Employment Guarantee Act and Unionization of Labour:

National Rural Employment Guarantee Act   Workers of unorganized sector for earning their livelihood are facing all round exploitation. The Government of India, with a view to provide exploitation free employment opportunities to almost 94% workers of unorganized sector, particularly for rural areas, enacted the “National Rural Employment Guarantee Act” in August 2005 which came into force with effect from 2nd February 2006 in 200 most needy and backwards districts of the country.  As per provisions of this Act, one member of every rural family shall be provided at least 100 days of labour-oriented employment in a year. It is a demand-based scheme in which every person that is willing to put in labour work on minimum wages shall be provided employment on demand. In case for any reasons, work has not been provided within 15 days of such demand, in that event unemployment allowance shall be provided to such member.  Rural Employment Guarantee Scheme clearly defines the roles and responsibilities of respective Panchayats as well as that of administration. The objective of this scheme is not only to provide work opportunities but also to introduce and implement schemes of development by utilizing available natural resources like water, forests and land.  With enactment of this law, the workers of unorganized sector have been provided with a legal platform to raise their voices against any exploitation, which was not available to them earlier. 

Initially, this scheme has been introduced in 18 districts of Madhya Pradesh having a approximate number of 42 lakh rural families.  All these families have been duly registered under the Employment Guarantee Scheme and respective cards have also been distributed to them. In other words, with the completion of process of registration and distribution of respective cards, the possibility of formation of Labour Organization has been raised.  It is a well-known fact that the system does not improve only with the enactments of laws, because the rights provided under the law are not being put to use as per their very political objective for which they have been made.

This Employment Guarantee Act is transforming itself in its real sense in the Godhra district of Gujrat. The advocates for a legal right to employment always believed that such an Act will not only provide employment and right to work, but will also play an important role in organizing the work force of unorganized sector. Six districts of Gujrat have been selected for implementing Employment Guarantee Act there. The State of Gujrat always represented the aspects of shining India.  Pro-reformists also considered and presented this area as a symbol of modern development.  It is being propagated, by quoting the example of Gujrat, that only the heavy industries, posh buildings and wide and clean roads can eliminate poverty.  In such an analysis, this fact has been conveniently ignored that with the extreme pollution of environment and social hatred being created and perpetuated there, are against the very canons of our democratic system of society itself and are fraught with dangerous consequences.

Like in other States of India, the National Rural Guarantee Scheme was introduced in Gujrat also on February 2006 and within a short period of five months only, the exploitation of poor workers started surfacing couched behind the rosy picture of development.   Due to clear violation of Employment Guarantee Act as well as Minimum Wages Act, 1948, the workers had to face wide spread exploitation. There the workers were assured that they would be paid their minimum wages at Rs. 35/- per day. In Balisana village of Sabarkantha district, 700 workers had put in their hard labour from 14th February for continuously 18 days.  But when the payments were made in the last week of May at different work places it was just shocking to them because, as against the minimum guaranteed wages of Rs. 35/- per day, they were paid only at the rate ranging between Rs. 4 and 7 per day.  Not only this, but there were wide-spread violation, at every stage, of other important provisions of Employment Guarantee Act also, like payment of wages within 7 to 15 days, equal wages for women, swinging rope for children, proper measurement of work done, etc.   The rules framed by the Central Government, under this Scheme, clearly specify that the minimum wages shall not be less than Rs. 60/- per day, but here also the Government of Gujrat continued with its authoritarian rule and deprived the workers of their legitimate rights.  Initially, the workers individually raised demands for their rights as provided under the Act as well as under the respective State plans, but soon they realized that unless they are organized within themselves and fight with unity, it will not be possible to get their rightful due. Then the workers of these districts started discussions and finally more than 5,000 workers assembled in Godra district and formed their Union, called National Rural Employment Guarantee Scheme Mazdoor Union.

The underlying basic condition for an effective implementation of Employment Guarantee Scheme is an honest political commitment towards its objectives.  A comparative analysis between Madhya Pradesh and Gujrat, in this behalf, shall prove the point as to how by adopting an honest approach this Scheme can effectively bring about a change in the prevailing conditions of unemployment in Society. Under the Rural Employment Guarantee Scheme, 43 lakh families of 18 Districts are involved in Madhya Pradesh. All these families have already been registered and issued their respective employment cards.  Here the efforts are not limited up to completing the formality on paper alone, but in fact more than 18 lakh workers are receiving their minimum wages at the rate of Rs. 61.37 per day and in addition, work on more than 20,000 projects, including roads, tanks and other community infrastructure, has already been completed. Consequently, the migration from the State has been reduced by 40% and also there is appreciable down fall in their exploitation being faced by them in the open market.  But on the other hand, in Gujrat, out of 32 lakhs families of 6 districts, only 7.25 lakhs have been registered so far and only a few of them have been issued their employment cards.  Neither the definitive guidelines have been issued on the implementation of Scheme, not any training has been provided to concerned Officers and people’s representatives.  

There can be many aspects of the situation, but the upper most question remains as to whether the so exploited workers of unorganized sector shall be able to get and invoke their rights by organizing themselves.  History tells us that any right is meaningless unless it is used in its true spirit.  The basic point of people’s struggle for Employment Guarantee Act was to the effect that there is neither any official protection nor any law for 93% of working population in unorganized sector.  Since they are not united, therefore, it negates any opportunity for political struggle for them.  It was expected from Employment Guarantee Act that it will move into right direction of people-based development and in the event of any deviation thereof then the united workforce will be empowered with rights for corrective and remedial measures.  Exactly this has happened in Gujrat.  

Although the law clearly defines the minimum wages, provides for employment guarantee for minimum 100 days in a year, unemployment allowance, drinking water at work site, swinging rope for children, primary health services etc., but in our prevailing social system, the exploitation of deprived ones is resorted to even without any apparent advantage, just to maintain the fear psychosis of powerful. To continue with such fear psychosis for their vested interests, the concerned officials and politicians, with the help of muscle men of the Society, are now allowing implementation of such provisions. Obviously, the labour force is not being allowed to realize their inherent strength.  

For the first time in India, the objective of any law is not only to accept the due importance of people’s struggle but by way of social audit and transparency, a legal cover is being provided to such provisions. The enactment of law alone does not ensure the automatic empowerment of workers with their rights. The provision of social audit shall not only control the prevailing corruption, but will also change the social equation of power at village level.  This clearly implies that without any concerted effort, this Act cannot be implemented in its true spirit.  Take a simple example of unemployment allowance.  The Act very clearly provides that in case a person did not get any work within 15 days of its demand, he will be entitled to receive unemployment allowance immediately after the lapse of such period. But while framing the relevant rules for implementing the Act, the entitlement of such allowance has been loaded with as many as 11 conditions, making it almost impossible for a person to receive any unemployment allowance.   As per official explanation also, in case the Government has provided no work in the entire village then instead of automatic payment of unemployment allowance, the people have to apply for such allowance and had to prove their respective eligibility.  Also there cannot be any joint application but people have to apply individually for the same.  Such a denial of joint approach shall obviously render the Act as meaningless.  The principle of promoting to convert individual rights and efforts into joint and concerted ones only shall bring about the desired change in the prevailing social system.  On the question of minimum wages, there are widespread possibilities of rendering the Employment Guarantee Scheme as a tool for exploitation in this behalf.  Looking at the ground level reality, due to task-based determination of work done, the workers are not getting their minimum wages and every such individual worker satisfies himself by just murmuring the objection within him.  The people behind such exploitation are very well aware that since the workers are not united and as such they not afraid of anything and even can easily take the risk of their exploitation without any hesitation. But a united voice on behalf of all workers just cannot be crushed and/or ignored. Similarly, Social Audit is not only a system for cross checking with due explanations, but in a way, a judicial system, which is duly empowered to fix the responsibilities and even to punish those involved in corrupt practices in the guise of development.  The so-called powerful people of the society who controlling the whole process, are the ones indulging in corrupt practices for their own vested interests. The power and/or authority being enjoyed by such people may be either political or derived from their caste and may also be that of money and muscle power.  While expecting from the respective Gram Sabha and Monitoring & Vigilance Committee of Workers to control, check and pinpoint corruption through the process of Social Audit, but the question is whether without a proper organization, the provision of effective social audit can be implemented at all or not.  The Labour Organizations will definitely provide a strong base to the efforts for social struggle.  In a way, a solitary organization is capable of changing the power equation.  For example, individually a worker, despite his best efforts, cannot even obtain a copy of muster role from the Public Works Department, while a Labour Union can easily collect the whole set of documents not only from that Department but from all public dealing departments.  However, the role of Labour Unions should not remain limited only up to labour work, wages and unemployment allowances, but should be viewed in a wider perspective.  In that such Unions and/or organizations, can play an effective role for ensuring the controlling rights of respective Gram Sabhas over the infrastructure and assets so created in the village through the various projects under the Employment Guarantee Scheme. 
Such Labour organizations can also play the role future Trade Unions of the country.  A caution has to be exercised to keep the Self-Help Groups as a separate and distinct entity, lest some groups of workers may entangle themselves into SHGs.  With the increase in income of Self Help Groups, they need to be more active in future and such SHGs may also be treated and defined as Workers Organizations. Thus, it needs to be clearly understood that labour force has to be united to fight for their cause, while the market is waiting for 30 crore new consumers. 

Factum of Minimum Wages:

In Madhya Pradesh, the number of marginal workers is 66 lakhs and that of small farmers is 37 lakhs. Thus, the labour work is an important source of livelihood for a total of 97.06 lakhs families who are dependent upon such physical work. Presently, about 94% of workers are earning their livelihood while working in unorganized sector where they are subjected to widespread exploitation.  However, with the implementation of National Rural Employment Guarantee Scheme, hopes are raised for meeting their basic needs by earning minimum wages at least.  In the State, rates of minimum wages for agricultural workers are fixed based on Consumer Price Index and accordingly the present minimum basic wages are fixed at Rs. 411.00 per month and Rs. 47.67 per day.  By combining both these heads, the unskilled agriculture work has been determined in the State.  Here the question arises whether these rates of minimum wages are sufficient enough to meet even the basic needs for survival of a human being, particularly in the face of prevailing price indicators.  Therefore, the minimum wages should at least be revised to Rs. 1841/- per month or Rs. 61.37 per day.

There are no effective alternatives to employment in Majhera village of Shivpuri district of Madhya Pradesh. In the face of heavy losses due to illegal mining, the stone mines in the area were closed down. Now with the implementation of Employment Guarantee Scheme, the hopes for an alternative employment have been raised.  They demanded for 25 days of work, which was also provided to them but they stopped working just after two days for the only reason that the amount of minimum wages being earned by them after putting hard physical work, was not sufficient enough either to feed their families or to meet other basic needs like health, education, clothing etc.  This is true not only for Majhera village but also for every such village where people are attempting to meet their basic needs by working for minimum wages.

The need of the hour is not only to increase the basic rates of minimum wages but the basic approach towards the whole issue also needs to be changed.  The prevailing system of minimum wages, instead of abolishing the poverty, is in fact increasing it. The rates of minimum wages so fixed in Madhya Pradesh, is not enough even for two times meal in a day, leave aside the needs of health, education and shelter.

The rates of wages are fixed as per the Schedule of Rates (SoR) for respective works.  In Madhya Pradesh, digging of 100 cubic feet on leveled surface is the minimum target, while on hard surface or murrum, it is 64 cubic feet and minimum wages shall be paid only upon completing this targeted measurement.  However, while linking SoR with minimum wages, it has been lost sight of that SoRs are applied where the construction work, under various Government Schemes, is being got executed through the Contractors, where the prime objective was only to get the work completed and not to ensure employment or to provide any relief against poverty to the workers so engaged by the respective contractors.

However, under the National Rural Employment Guarantee Act (NREGA), the objectives of public welfare and rights of workers are of utmost importance – rather backbone of the Act.  As such, it has to be ensured whether it would be physically possible for the already weak workers to meet the strict standards and measurements for labour work, so fixed by the Government to determine the amount of wages payable to them. The situation has to be viewed in the background of the fact that many of Dalits and Tribals are physically so weak that it is just not possible for them to earn their minimum wages by achieving the targets so fixed for labour work.  On the other hand, the Government Officials, in their sheer attempt to show the targeted progress of work, apply the fixed standards with absolute strictness, with the result that workers are deprived of their full day’s wages.  Consequently, their prevailing state of their mal-nutrition, hunger and poverty remains unchanged without any improvement whatsoever.  

The irony is that while fixing the SoR, the Government has completely overlooked the varying geographical and regional conditions. To give an example, for digging the soft soil of Hoshangabad and hard & semi-hard surface of Badwani districts, similar labour standards are fixed and applied in both places, irrespective of the fact that geographical conditions of both places are just contrary to each other. When those of the workers who are working on hard surfaces are not able to provide similar output, as compared to their counterparts engaged on land with soft soil surface, the formers are branded as lazy ones, conveniently ignoring the divergent conditions in which they are operating.  If the task-based minimum wages are to be determined even under the Employment Guarantee Act, then the women workers shall obviously be deprived of their right of equal wages as compared to their male counterparts. A clear-cut distinction is being made with women workers and accordingly they are being paid lesser wages, thus also violating their fundamental right of `Equality’.  As such, there is absolute need to start the process of determining the minimum wages, based on respective geographical conditions, community involved and principles of social welfare.  Not only this, the Minimum Wages has also to be linked and defined as the fundamental right so that the respective rates may be revised in such a manner at least to meet the basic needs of workers.

Here it is also important to observe that the process involved for determining the wages is comparatively more demanding on the quantum of labour input, while a section of labour work force also includes disabled and facing malnutrition, under nutrition and food insecurity.  Thus, making task-based payment of wages for such people is nothing but a sheer source to exploit them.  Thus, the need of the hour is to break the nexus between technologies and mechanization and for this the first and foremost task is to evolve a process for determining the rates of wages in such a manner so that human angle is not lost sight of.  The more we link the wages with productivity, the more it will establish the preferential need for mechanization and thus it will be proved that since workers are not able to contribute enough in the process of development, therefore, the Government, just to complete the formality of meeting its ‘social’ obligations, instead of providing them with any physical labour work, they may be paid compensation in lieu of wages.   Such a situation will, of course, inherit serious repercussions. As such, it is of utmost importance to analyze the Right to Employment Act in the background of poverty and prevailing social conditions.

The Minimum Wages Act, 1948 is based on Article 43 of the Constitution of India which provides for fixing such minimum wages for the workers as are sufficient for them to lead a respectable social life. The Minimum Wages Act, nowhere and in no manner advocates for fixing such minimum wages, which are not sufficient even to meet the food requirement for worker and his family members.  On the contrary, it favours for such minimum wages, which are at least sufficient to meet the needs for 2700 calories of food per person, 72 yards of cloth for the family and shelter needs.  In addition, for home lighting and cooking fuel an amount equivalent to 20% of minimum wages is also fixed as part of wages. Thereafter, the Hon’ble Supreme Court, in one of its historical judgments in 1991, directed that for meeting the educational needs of children, health facilities and other social requirement, an amount equivalent to 25% of minimum wages is to be added as part of wages.  However, the State Government constantly ignored the constitutional and legal provisions as well as directions of Hon’ble Supreme Court in this behalf.  Presently, the fixed minimum wages in Madhya Pradesh is Rs. 61.37 per day and accordingly, attempts are being made to provide 100 days work to 42 lakh rural families under the Rural Employment Guarantee Scheme.  Thus, in an average family of 5 members, the share of each comes to Rs. 12.12 per day i.e. Rs. 6.06 for one time meal.  On the other hand, for meeting the requirement of Minimum Wages Act for 2700 calories of food per person, it requires an expenditure of Rs. 20 per day per person and for meeting the clothing, education and health needs, an additional amount of Rs. 12/- per day per person is to be added thereon.  Clearly, as against required minimum wages of Rs. 160/- per day (20 + 12 = 32 x 5), the Government is paying only Rs. 61.37 per day.  Also there are contradictions as far as line of poverty is concerned.  On the one hand, as per Government’s own definition, a family spending less than Rs. 1800 per month is considered to be on the verge of hunger, while on the other hand, it is paying only Rs. 500/- per month to workers for their survival. Although the Central Government warmly welcomes the concept of globalization and open market and talks of international standards, but conveniently looks at the other side when it comes to comparing the international standards of poverty. It never accepts and implement such standards aimed to protect the poor. As against the international standard of expenditure at $ 2 per person per day  (equivalent to Rs. 90) the Planning Commission of India considers an expenditure of Rs. 12 to 14/- per day per person as sufficient amount to lead a respectable life.  This approach has to be changed.  The poverty line in India is in fact a hunger line. It is rather unfortunate but true that even the people’s representatives in Parliament are not aware of stark reality of minimum wages.  Recently, even the Standing Committee of Parliament expressed its shock and surprise over the prevailing rates of minimum wages.

Presently, there are 66.90 lakhs of deprived and marginal workers, out of which 45.52 lakhs (68%) are women who suffer maximum exploitation in terms of minimum wages.   It has to be clearly understood by the policy makers that for proper development of physical capacity and mental capability of workers, they have to be paid better wages and in the absence of such development their productivity cannot be enhanced.

By introducing the National Rural Employment Guarantee Scheme, the Government has initiated a historic step, but to achieve its real objective, it has also to come forward for defining the minimum wages afresh. On its part, when the Central Government is bearing the burden of additional wages, then it becomes rather incumbent upon the State Government also to initiate political steps for empowering its workers with their respective rights which in no way put any additional burden on the State Government.

The workers of organized sector are obviously in a better position as compared to those working in unorganized sector, simply because they fight for their rights in an united manner.  Thus, unless the workers of unorganized sector unite themselves and raise a concerted voice, then even the Rural Employment Guarantee Act shall not be able to provide any protection to them.  In this era of globalization, in the absence of any united pressure on the issues of public importance, no steps to solve them shall be considered and initiated by any of the four pillars of democratic institution. Therefore, the need of united public struggle has to be accepted as a reality in this era.

Statistical data on Livelihood in Madhya Pradesh



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%age over total working population


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Agricultural workers




Workers engaged in cottage industries




Other employed persons




Marginal workers




Registered factories/industries




Average employment in registered factories/industries




Daily employment generation (per lakh)




Educated unemployment in State




Total employment in public sector




Child labour in the State










































Sachin Kumar Jain

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