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Submitted in partial fulfillment of the requirement for the degree of M.Tech. in Technology and Development
Centre for Technology Alternatives for Rural Areas (CTARA) Indian Institute of Technology Bombay August 2013
Certificate
This is to certify that the report entitled Economic Prospects for Dhaulvali Village, Ratnagiri, Maharashtra, India submitted in partial fulfillment of the requirement for the degree of Master of Technology in Technology and Development of IIT Bombay, Mumbai 400 076 is a record of bonafide work carried out by Vishal Singh (Roll No: 123350007) under our supervision and guidance.
Examiner
Prof. Milind A. Sohoni Center for Technology Alternatives for Rural Areas (CTARA)
Acknowledgement
I wish to thank the villagers of Dhaulvali to host my stay, support the extensive study and care for me like a family. Without their cooperation and active involvement in participatory appraisals, this study would have not been successful. I especially wish to thank, Shri. Subhash Purushottam Gokhale and his family for their hospitality throughout my stay. It is my special privilege to have valuable guidance and insights about village life and development activities at grassroot level from Sarpanch Shrimati Akshat A. Velye, Upsarpanch Shri Sanjay D. Kiranje, Shri R.T. Dalwi and various other members of the village and the gram panchayat. This study would have been far from completeion without their help and support. I would take this opportunity to express my respect and sincere thanks to Prof. Milind A. Sohoni, Prof. Milind Gokhale, Prof. N. C. Narayanan, Prof.Puru Kulkarni and other faculty members from CTARA and other departments at IIT Bombay for giving me the opportunity to explore village life and learn some life lessons.
Date: 5th August 2013
Vishal Singh
Table of contents
Certificate...................................................................................................................................................... 2 Acknowledgement ........................................................................................................................................ 3 Table of contents .......................................................................................................................................... 4 List of Figures ................................................................................................................................................ 5 List of Tables ................................................................................................................................................. 5 Professional Summary .................................................................................................................................. 6 1. Economic Structure of Dhaulvali........................................................................................................... 7 1.1 The Three Tier Structure ..................................................................................................................... 7 1.1.1 Typical Practices ........................................................................................................................... 8 1.2 Stakeholders of the village economy .................................................................................................. 9 1.2.1 Inhabitants ................................................................................................................................... 9 1.2.2 Emigrants ..................................................................................................................................... 9 Landholding Pattern, Dhaulvali ................................................................................................................... 10 1.2.3 Big farm owners ......................................................................................................................... 11 1.2.4 Enterprises in Dhaulvali ............................................................................................................. 12 1.2.5 Local Businesses ......................................................................................................................... 13 2 Parameters of the village economy ......................................................................................................... 14 2.1 Sources of income ............................................................................................................................. 14 2.2 General expenditure trend ............................................................................................................... 15 2.3 Parameters influencing local economy ............................................................................................. 15 3. Employment Schemes............................................................................................................................. 16 3.1 Employment Guarantee Scheme ...................................................................................................... 16 3.1.1 Future of NREGA ........................................................................................................................ 16 3.2 Integrated Watershed Management Program (IWMP) .................................................................... 18 3.2.1 IWMP and allied activities.............................................................................................................. 19 4 New opportunities and scope of improvement ....................................................................................... 20 4.1. Improving the Rural Investment Climate for Businesses ................................................................. 20 4.1 1 Increase Market Demand ........................................................................................................... 21 4.1.2 Access to Marketplace and Market information ....................................................................... 21 4.1.3 Access to Finance ....................................................................................................................... 21 4
4.1.4 Business Services........................................................................................................................ 21 References .................................................................................................................................................. 22 Credits ......................................................................................................................................................... 22 Appendix ..................................................................................................................................................... 23 Rural Investment Climate Questionnaire ................................................................................................ 23
General information: Characteristics of the establishment ........................................................................ 23 Infrastructure and Services ...................................................................................................................... 23 Labor ....................................................................................................................................................... 24 Finance .................................................................................................................................................... 24 Sales and Supplies .................................................................................................................................... 24
Degree of Competition ..............................................................................................................................................25
List of Figures
Figure 1.1: Population division by age Figure 1.2: Landholding pattern in Dhaulvali Figure 1.3: Total area under cultivation Figure 1.4: Non-farm activities, Dhaulvali Figure 1.5: Nate Market, Geographical Coverage Figure 1.6: Nate market, Business mix Figure 2.1: Segregation based on source of income Figure 3.1: Population census, Dhaulvali Figure 3.2: New well dug at Teliwadi, Dhaulvali Figure 3.3 Migration Statistics, Dhaulvali GP Figure 3.4 Details of Allied/other activities, Dhaulvali GP
List of Tables
Table 1.1: Monthly requirement for PDS shop, Dhaulvali Table 1.2: Farms in Dhaulvali GP Table 3.1: Average income of emigrants, Dhaulvali GP Table 4.1 Problem Ranking Chart, Dhaulvali
Professional Summary
This report contains a detailed analysis of collected data pertaining to the economic status of the village Dhaulvali and nearby villages. It outlines the primary stakeholders of the village economy and an effort will be made to compare available livelihood options of different kinds as seen in the village on a one on one basis. The document also contains the livelihood opportunities as being presented and projected by the IWMP DPR as an outcome of this project in the village. The last section will discuss opportunities that can be profitably pursued given an economic environment like Dhaulvali.
1.1.1 Typical Practices The people of the older generation reside in the village itself and are quite often able to fend for themselves by doing agriculture in a small spot of land or by working as a wage labor for a few days. The needs of a village life are also meager, hence people are able to live on whatever small amount of his earning the boys (and girls) of the family send home. The practice of agriculture also is seen to have gone down over the years and a practice of the male of the house migrating to a nearby big town is seeing a tremendous rise. Not only, this whole process is causing economic instability of the region, it is also causing social problems. Even then, there is a lot of inclination in the young minds of the locale to migrate. This situation is not isolated and similar practices are followed in most parts of the Indian states. The person, who migrates to another city for a job, sends home a small amount of his earning for his family back in the village by money-order. This process has rendered the descendants of a whole generation of producers become consumers. From the household interviews we conducted, out of the total 307 people we interviewed from across 50 households spread over the entire span of Dhaulvali over 12 habitations, we found the average age to be about 35.2 years of age and an average level of education to be slightly more than 7 years of formal schooling. This signifies that a large part of the population falls in an age group which is the fittest for work conditions. A good amount of literacy was also found to be prevalent. The typical practices being followed in this and nearby villages is of great concern to everyone as a whole. It has caused overburdening of citys resources and weakening of a healthy village economy. The prospects this system does hold for future, are tried to be discovered in this section.
A village of 3185 inhabitants requires the input of about 119 tons of food grains per month. A quick back of the envelope calculation will show that the average per head requirement is about 37 kg and average per head daily consumption is about 1.25 kg. The inhabitants have reported that they bought salt, spices and edible oil from general stores but rarely bought grains. However a significant no. of marginal rice farmers exists in the village which needs to be accounted for. 1.2.2 Emigrants The emigrants of the village in most probability have settled in the metropolitan city of Mumbai which is about 380 km from the village. Most of the emigrants are working for private firms in jobs requiring physical labor. A handful of the people have government jobs. A large number of emigrants have caused societal complications as well. This is attributed by the fact that young women of the village demand grooms residing in Mumbai for marriage. Even though a lot get suitable grooms, their situation remains far from improvement. Even the married couples do not live in together at Mumbai. Common practice is to leave back the bride at the village to take care of her in-laws, children, animals if any and farming as well, while the groom moves to the city in search of work. He then sends home an amount of money which in most cases covers the very basic needs, like ration from PDS shop, electricity, cable tv and mobile phone bill. This practice has led people residing in the village give up on farming totally. Most aged residents have based their livelihood on the monthly money order they receive or take up wage labor if required. The whole region is seeing a lot of migration. Much of this is also attributed to the fact that farming is a risky proposition in these times. The financial and physical inputs demanded by rain-fed rice farming do not return enough on investment so as to compare it with paid labor.
8% 22%
20%
Landless Land holding<1 acre Land holding > 1 & < 5 acres Land holding >5acres
50%
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1.2.3 Big farm owners The owners of big farms usually are the hereditary landholders of the Brahmin caste. Quite a few people have bought new or converted their existing lands to create mango farms. This activity is seeing an upward trend because mangoes provide good returns on investments as compared to rice. However the mango farm owners are facing an acute shortage of labor for different farm activities. Various vital activities that need to be taken care of are pre-season treatment, soil preparation, fertilizer spray, insecticide spray etc. Mangoes also need protection from the damage caused by monkeys and baboons in the area. Farm owners have to employ people from outside the locality for several of these tasks. Table 1.2: Farms in Dhaulvali GP Habitation Mango Dhaulwalli 66.14 Poklewadi 7.49 Ambelkarwadi 32.55 Bhablewadi 16.88 Dasurewadi 4.27 Total 127.33 *All areas in Hectares
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1.2.4 Enterprises in Dhaulvali Enterprises of two major types were seen in the locality. The farm and non-farm activities were the two major distinctions between the types of enterprises. The village sees a plethora of farm activities and fishing is the favored livelihood activity of many inhabitants of the nearby village Nate. The pie chart below shows the various divisions of the 26 non-farm enterprises identified in the village. Fig 1.4: Non-farm activities, Dhaulvali
1 1 8
General store Flour mill/rice mill Dairy farm Spice mill Fruit juice
It should be remembered that while the enterprises in the village are of diverse nature, not all requirements of the residents are fulfilled by them. This has led to a local ecosystem of villages with Nate villages marketplace as a primary source of supplies. While the enterprises in Dhaulvali satisfy most of the basic requirements, the marketplace at Nate fulfills commercial requirements as well. Complete with banks, ATM and post office, Nate has grown to become a flourishing center of fish trade. Various types of enterprises of the medium and small scale exist in and around the village. However, due to limitation of time and data collection capacities, there might be a few left out and not accounted for.
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1.2.5 Local Businesses The local marketplace is the nearby village called Nate and is visited by almost all families of Dhaulvali regularly. The marketplace at Nate is quite diverse in nature and can be compared to a small town market. It serves many local shoppers from many nearby villages like Ambolgarh, Padawne, Sakhrewadi, Pokri, Sakhri, Rajwadi, Tiwre, Mogre, Panere, etc. The pie chart below will give an idea about the mix of various businesses being spotted at the Nate marketplace. Figure 1.5: Nate Market, Geographical Coverage
General stores Fish Stalls Eateries Vegetables Jwellery Electronic repairs Tailor Medical Bakery Printing Meat shop Bar Construction Saloon Stationary Clothing Hardware Steel fabricator Driving school Lottery Head Shop
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3. Employment Schemes
This section will discuss the various governmental schemes running or planned in the area. Schemes which have promised or are providing various types of assistances for creating a better living environment and creating new livelihoods are discussed.
3.1.1 Future of NREGA The future of any employment guarantee scheme looks grim unless wholesome changes are made in the working structure and guiding principles in the project. It however remains a question of the future to see what developmental changes such a large scale social investment can actually bring over time. It perhaps first needs to be implemented carefully.
http://www.epw.in/system/files/pdf/2013_48/26-27/Designed_to_Falter.pdf
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Below is a well that the inhabitants of Teliwadi dug themselves and every input was made by a resident contributor. This was after repeated requests to the administration about water shortage and need of new supplies. Figure 3.2: New well dug at Teliwadi, Dhaulvali
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The plot above is created by using the statistics obtained from the IWMP DPR for Rajapur. The average wages as earned by the migrants as reported in the DPR is given in the table below. The details were based on the PRA conducted by IWMP and the Census of India, 2001. Table 3.1: Average income of emigrants, Dhaulvali GP Name of village Female Male Total Average income Dhaulvali 60 155 215 5000 Ambelkarwadi 28 72 100 5400 Poklewadi 12 31 43 5250 Bhablewadi 17 44 61 5250 Dasurewadi 17 43 60 5200
Average time >5 months >5 months >5 months >5 months >5 months
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It will remain a test of time to see whether the project actually is able to deliver its promises and is able to create the various livelihood opportunities as proposed. Various other data sheets have been captured from the DPR which will prove to be a valuable source of data in the longer run.
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Male 9 2 10 3 8 4 7 6 5 1
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4.1 1 Increase Market Demand The market demand for goods produced at a small shop in some village is very much unable to fight competition with that produced by big companies. However, there were a few juice and extracts bottling plants in the village. The need of better sales and supply chain and the need to increases selfemployment opportunities availability in the locality are urgently felt. The entrepreneurs also added worries about finding adequate labor even in non-farm seasons. 4.1.2 Access to Marketplace and Market information This was a major challenge for all enterprises, small and medium alike. The access routes are good overall but are not in a very good condition in Dhaulvali village. The transport facilities are a major challenge for at least half of the habitations of the village situated east of the stream. This also poses problems of market access to entrepreneurs and families who were earlier involved in home based business are converting to job based families. 4.1.3 Access to Finance Finance options are available through cooperative banks and nationalized banks. Many of the enterprise owners reported to have repaid the loans they received or not to have taken a loan at all. Even then the finance options were not termed friendly by the investors. The village does not have any financial institution apart from a small post office which only provides communication facilities. There is a nationalized bank and a cooperative bank as well as a proper post office in the nearby village Nate. 4.1.4 Business Services There is a huge lack of business services as required by a proper economic climate to flourish. Even basic necessities like photocopier and atm are absent in the village and the GP as a whole. This causes a great many financial and other related problems in the village. A good input in this field is required for a good economic environment to flourish and perhaps it will also be able to stop migration to a small extent.
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References
Nonfarm Microenterprise Performance and the Investment Climate: Evidence from Rural Ethiopia -Josef Loening, Bob Rijkers and Mns Sderbom Farm households entry and exit into and from non-farm enterprises in rural Ethiopia - Merima Ali Promoting the Rural Farm and Nonfarm Businesses - Naotaka Sawada, Jian Zhang Non-Farm Occupation in Rural India - A. K. Mukhopadhyay, D. Gangopadhyay & Saswati Nayak Non-Farm Household Agricultural Enterprise Survey
Credits
Mr. Subhash Gokhale (Dhaulwalli) Mr. Shyam Gokhale (Thane) Ms. Akshata Velye (Sarpanch, Dhaulwalli) Mr. Prakash Aayar (Dhaulwalli) Mr. Ramesh Toraskar (Dhaulwalli) Mr. R.T. Dalwi (Dhaulwalli) Mr. Kiran Gokhale (Dhaulwalli) Prof. Milind Gokhale (IIT Bombay) Agriculture Office (Rajapur) State Transport (Rajapur)
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Appendix
The appendix contains the questionnaire as developed and used for data collection about various enterprises.
Labor
Does this business employ household members (including children) How many household members were actively employed in the enterprise How many hours per day do these people work Does this business ever have any permanent [hired] employees How many salaried employees worked for enterprise in last 1 month How many hours per day do these people work Does the business hire or give work to anyone on a contract or casual basis How many contractual workers worked for enterprise in last 1 month How many hours per day do these people work Level of education of average laborer Formal training No. of skilled laborers No. of unskilled laborers No. of female laborers
Finance
Paid for after delivery Working capital Purchase of fixed assets, investments, etc. Fixed assets Checking/savings account An overdraft facility Loans Institutions that granted loan Value of the outstanding loan Collateral Value of collateral as percent of loan value Application for new loans in last year
Theft, breakage or spoilage full production capacity capability Hours per week of operation
Degree of Competition
Number of competitors in establishments market Technology licensed from a foreign owned company Competition from unregistered or informal firms
Security
Pay for security How much pay for security Experienced losses from theft, robbery, vandalism, arson Extent of losses from theft, robbery, vandalism, arson
Business-Government Relations
Is the enterprise registered under any Act or authority of registration Year of registration Have you received any recognized certifications Application for operating license Wait for operating license Bribes for operating license Visitations from tax inspectors Bribes from tax inspectors Size of informal payments/gifts
Performance
Total cost of labor, including wages, salaries and benefits Raw materials and intermediate goods Finished goods and materials purchased to resell Electricity Communication services Fuel Other costs of production not included above
Comments
Date Time Place
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Other comments
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