The Imbalance

Go read this BusinessWeek article (Outsourcing heads to outskirts), its your usual Amrican media stuff trying to make a mere experiment sound sensational. Days when technology jobs will move to our villages are far away. But before that, tell me how to react to these lines from this article:

Srinivas Ruddireddy makes twice as much money arranging car services online for people in Hyderabad as he does from the two-acre rice plot he tends in the early morning.

For a while now, a solid 20% chunk of our GDP (Agriculture) has been stuck in 2 percent growth curve dragging the overall growth numbers down. Moreover, this sector employs 60% of country’s workforce, which means incomes are low. So we have a situation where 40% of population is part of 15-20% growth story, while the rest and majority is seeing negligible growth in incomes, and that too from low bases.

Loud and clear, this is an imbalance. And the good news is – our policymakers realize this imbalance needs to be addressed now. Or else, we can’t grow faster. Or else, we could hit into severe social unrest. Or else, add-your-concern-here.

Both PC and Manmohan have been making the right noises recently – second green revolution and all that. Why do I sound hopeful that this noise is going to lead to some action on the ground? Because, doing something for the farmers and agriculture will keep all politicians happy – pro-urban sounding PC and PM get to sound pro-rural and buy Congress lots of votes, and, they get to raise the economy’s growth rate as well. The Gowdas and Yadavs won’t say no either. Yes, we will see the usual political chaos, but it will result more from differences over “how”s than “what”s.

Now, before I start sounding even more like regular newspaper editorials, back to the BusinessWeek article that got us started. Easier said than done, becuase electricity in villages is more like 10 by 7 and not 24 by 7. Villages lack skills for BPO jobs (english language skills). And there are more rigors than thrills involved in few hour long journeys from ‘nearest’ big cities to these villages.

I see the procurement side of an upcoming organized retail boom transforming our small towns and villages before these IT enabled jobs do. And call centers in our hinterland might do “Idu UTI bank, naan Pranav. Yen help beku madam” more than “This is Roger for Bank of America, how may I help you”.

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15 Responses

  1. Some service sector jobs can certainly move from large cities to smaller ones. It should be obvious to anyone that our villages lack infrastructure to support service sector. It is unlikely that our villages or even semi-urban areas will become back offices to Indian companies in the near future. Service industry has its limits. We have to find a balance between agriculture, manufacturing and service based sectors.

    The first green revolution has managed to destroy the Indian farmer. Why? There was a relentless focus on the crop yield. Our “experts” and leaders got most of their advice from outside. As a result, companies (including MNCs) that product fertilizers, pesticides and hybrid seeds benefited. This meant high input costs. As yields rose, the margins shrank. Our merchant class (in collusion with political class), as usual, exploited the farmers. Illiteracy among small farmers is not helping the situation either. Intensive irrigation, fertilizer and pesticide use means lower land fertility and high pollution of soil and water.

    When our PM talks about a second green revolution, let’s hope that he thinks about decent profit margins for the farmers, preservation of native crops, less dependence on chemical farming, real reforms in agri-markets etc. We can’t continue on this path of two Indias – rich vs poor, urban vs rural, educated vs uneducated etc.

  2. This sounds so positive silkboard. Specially the last line Idu pranav…
    This made my day, the post title is so apt.. The Imbalance, which itself says I’m balance(copy from I’m possible)!!
    I was so unhappy to hear that our poor villagers end up getting their annual income lesser than our monthly ones. Its quite dis-heartening …!
    Hope the suicidal graph takes a low path atleast now..

  3. […] A bengalooru blog hopes the Manmohan Singh government is serious about addressing lopsided agricultural growth Doing something for the farmers and agriculture will keep all politicians happy – pro-urban sounding PC and PM get to sound pro-rural and buy Congress lots of votes, and, they get to raise the economy’s growth rate as well. The Gowdas and Yadavs won’t say no either. Yes, we will see the usual political chaos, but it will result more from differences over “how”s than “what”s. […]

  4. I remember there was this kid (very brilliant) from our PUC 2nd year batch. When everyone was hankering after MBBS, BDS, IITs, RECs and Engineering, He was bent on getting into Bsc Agri. If someone like him found a different way of farming. Say on the same square feet of land if the yield can be boosted to 10 times earlier yield. Using hybrid plants, growth harmones, artificial mineral soil, water harvesting and delivery to roots. Also wondering why farming should always be 2D. Why not build farm green houses as sky scrapers and bring sunlight using fibreoptics, use climate control. It could actually freeup some land for the forests and SEZs. This could actually be tried in an agri-SEZ, Biosphere 3.

  5. Good post SB. Thanks for writing about this. I think the people at the helm of affairs right now, like Manmohan Singh and Chidambaram are the right kind of people to lead this country. Yes, they are making the right noises and chances are they will follow up on the same. For the votes, as well as for the betterment of the country.

    I have asked this question to a few people now and I ask you too… what do you think of our PM. Do you think he in entrenched in the same petty vote bank politics like the Yadav’s and the Mulayams or do you think he is a basically a good person who wants to do something positive in the larger scheme of things?

  6. “I see the procurement side of an upcoming organized retail boom transforming our small towns and villages before these IT enabled jobs do”.

    Couldn’t be more true.. and realistic.
    Practical common sense solutions required :)

  7. Apun ka Desh, we had similar discussions about the retailers boom in Vijay’s blog. Read at ease, it was a nice one!

    http://bizzbuzz.wordpress.com/2007/01/05/the-death-of-the-small-retailer/
    http://bizzbuzz.wordpress.com/2007/01/11/why-the-small-retailer-will-survive/

  8. Thanks everyone for thoughtful comments. I will like to go a bit off-topic and talk about politicians and vote-bank and such.

    One can’t get anywhere by bashing Yadavs and Gowdas or praising PC and MMS as being ‘basically’ good people. Vote banks are a reality. And ultimately it is people who put them in the parliament – Yadavs or Singhs. To get to that house, you have to do your work and planning. If a politician says he does not play vote-bank games, he is either lying, or being dumb.

    Now, you will say most of them are corrupt and all that. Forget politicians, tell me who around here is good and honest. You? Me? Not trying to get philosophical, but trying to say that instead of being practical and working with ground realities, we tend to get lost in idealistic notions.

    Take an example from our offices. Junior employees blame their leaders and managers for all things bad. And they in turn blame their juniors and bosses for the problems they get blamed for. Okay, that sounds vexed, but the point is – There are problems at every level, and one cant figure all of them without actually “being” there.

    This is not to say that netas and babus don’t suck. But all I am saying is that there are a good many of them who mean business. But, we may not understand what their intentions and frustrations are.

    How do you think our country has managed to come this far? Magic is it?

    Long comment, but I hope I made my point clear. Whether it makes sense or not is your call :)

  9. :) “basically” I agree with everything you’ve said…

  10. Green Revolution or not, there are few things that need to be taken care of, though there is some activity in this regards…..how much and how long will these take to fructify is another matter, just to name a few

    1. APMC amendments
    2. Agri Marketing Infrastructure, as nearly as 65000/- crores are required for this.
    3. Development of some model for inclusion of small and medium farmers at commodity exchanges
    4. Private sector participation, in reasearch, in infrastructure development, in extension, how can we promote these

    As regards the Bweek’s linked article, how do we react to WEB2.0 buzz ? ;)

  11. think like this… most graduates produced from Indian colleges are practically worthless…. the kids have always lived in a sheltered environment and do not know what skills are required and what they want from life.
    by serving in BPO they actually reduce the unemployment of those educated but underskilled work force which indian colleges produce

  12. [was out traveling all of last week, so late replies]

    OI, I tried my best to draw you into a debate :)

    Nitin, APMC, Agri Marketing etc, you seem very informed. Actually, I am planning a post on APMC. Got inspired by a program a I saw recently on CNBC TV18 called “The tail of retailing”. It had the message a I believe in myself – back end of retail could bring positive developments in our hinterland. About Web 2.0 – that will probably be too technical a discussion here.

    Pegasus, Agree 100%. BPO is good for educated but under skilled workers. But how is that helping the imbalance? How and when can these jobs touch our rural areas? If the guy in Scarlet‘s example be provided the incentives and setup to pursue Agriculture, that could spark bigger changes than these BPO jobs will.

    Before I forget, Apun Ka Desh, thanks for that vote of agreement!

  13. villages are growing into towns, towns into cities, and cities into metros. and this is the only way these high paying jobs will move into less developed areas.
    I believe productivity of land and workers is higher in urban centers and service industry. Hence no wonder india is urbanizing at 1% per annum.

  14. This sounds so positive silkboard. Specially the last line Idu pranav…
    This made my day, the post title is so apt.. The Imbalance, which itself says I’m balance(copy from I’m possible)!!
    I was so unhappy to hear that our poor villagers end up getting their annual income lesser than our monthly ones. Its quite dis-heartening …!
    Hope the suicidal graph takes a low path atleast now..

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