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Casual Labour Contracts of Agricultural Labourers in East and West Uttar Pradesh

This paper analyses the nature of casual contracts prevailing in the rural labour market in regions with diverse socio-economic patterns of development. The most important feature of such a labour market is the growth of "group" labour contracts particularly with in-migrants in Meerut. It looks further at interlinked transactions in the agricultural labour market, and highlights the emergence of interlinked transactions in the dairy market of Meerut where agricultural labour households are increasingly getting tied with 'dudhiyas'. Lastly, this paper demonstrates the increasing importance of non-agricultural employment for the labour households and the pattern of diversification of agricultural labour households in Meerut in the form of dairying.

Casual Labour Contracts of Agricultural Labourers in East and West Uttar Pradesh

This paper analyses the nature of casual contracts prevailing in the rural labour market in regions with diverse socio-economic patterns of development. The most important feature of such a labour market is the growth of “group” labour contracts particularly with in-migrants in Meerut. It looks further at interlinked transactions in the agricultural labour market, and highlights the emergence of interlinked transactions in the dairy market of Meerut where agricultural labour households are increasingly getting tied with ‘dudhiyas’. Lastly, this paper demonstrates the increasing importance of non-agricultural employment for the labour households and the pattern of diversification of agricultural labour households in Meerut in the form of dairying.


I Introduction

his paper attempts to analyse casual labour contracts in hired rural labour markets located in regions with diverse socio-economic patterns of development. Regional contrasts have been brought out in the nature of such contracts in two localities of eastern and western parts of Uttar Pradesh in India. This has been done by looking into the asset base of labour households and their dependence on landowners. In this context interlinked transactions have been analysed. Evidence on interlinkages is relatively scanty but has a wide range from nonexistence in some localities [Dreze and Mukherji 1989: 246] to continued existence with changing conditions of production in other localities [Bardhan and Rudra 1980; Srivastava 1996]. This paper shows significant interlinkages in the agricultural labour market in Ballia and declining evidence of such transactions in Meerut. But at the same time it also highlights unprecedented emergence of interlinked transactions in the dairy market in Meerut where agricultural labour households are increasingly getting tied with ‘dudhiyas’ signalling an inadequacy of credit institutions in catering to the needs of labourers and the vulnerability of the labourers to exploitation.

Secondly, it brings out the lack of opportunities for diversification of labour households into allied or non-agricultural activities in Ballia villages. Meerut villages, on the other hand, presents a contrasting scenario where increasing importance of non-agricultural employment in nearby region/s and diversification of labour households into dairying is creating a pressure on demand for labour in agriculture, which in fact is attracting labourers from surplus regions.

Finally, this paper shows the emerging newer type of contract formations with in-migrants in Meerut where contracts are formed with the “group”. These contracts are formed with the group of migrant labourers instead of individuals. Variations of such contracts have been reported by a number of studies from different regions but in Meerut these contracts are new and no other study has as yet reported such contracts from Meerut. It shows how the growth of migratory labour is contributing to the changes in casual labour contracts from individual to “group”. It basically represents two tendencies: (i) growth of daily casual labour contract of individual labourers to “group” labourers where labourers can protect their interests and have greater bargaining power; and (ii) where in-migrants in particular are able to protect their interests by working as casual labourers in a “group” rather than attaching themselves to individual employers where they are open to blatant exploitation in an alien environment. These contracts are seen here as representing increased consciousness and therefore appear as proto-union.

This paper is based on field survey of four villages, Bharauli and Baghauna in Ballia district, and Dulhera Chauhan and Dhanju in Meerut district conducted during 1999-2000.1 The paper proceeds as follows: after the introduction, the second section discusses casual daily labour market and interlinked transactions arising in this market. The section three presents casual “group” labour contracts and its analyses. The last section provides comments and conclusion of the study.

II Market for Casual Wage Labour

Economic Base of Labour Households

Among the total sample of agricultural labour households 95 per cent labourers in Ballia villages and about 99 per cent labourers in Meerut villages were classified as casual. The scheduled castes form the major part of agricultural workforce in all the surveyed villages.

Land ownership among the labour households in Ballia villages is almost nil and only 23 per cent of casual labour households lease-in land for cultivation. The remaining 77 per cent of these households work as pure labourers who neither own nor operate any land. In contrast to this, in Meerut villages 65 per cent of such households were found to be operating land and 58 per cent have access to land through ownership.2

Similarly, livestock ownership is also low in Ballia villages and only 35 per cent of casual labour households own livestock, out of which only 11 per cent own milch cattle but none of these households are engaged in selling milk. Milk animals owned are goats and non-milch cattle include cow-calves or buffalo-calves. Ownership of calves in these villages is mainly on a share basis.3 Most labour households keep animals mainly for sale and not for selling milk. Cattle-raising or milk-selling is neither their main nor subsidiary economic activity of these households. In contrast to this, livestock ownership in Meerut is significant and more than 90 per cent of labour household own milch cattle and engage in milk selling. They own mainly buffaloes and a small proportion of cows. On an average, one household owns two animals which include milch cattle and their calves. Although cooperative societies act as milk collection centres in various villages [Singh 1992: 56], the system of milk collection by local ‘dudhiyas’ is equally institutionalised in Meerut villages, who come and collect milk from houses of labourers every morning and evening. There were about 5-8 dudhiyas in one of the villages (Dulhera Chauhan) at the time of survey, mainly belonging to landed rajput caste. They usually act as middlemen between small suppliers of milk and the private and cooperative milk collection centres.4 Labour households supply milk to these dudhiyas because they are the most important source of credit and most labour households were indebted to these dudhiyas and therefore they are obliged to sell milk to them. Dairying is the most important subsidiary occupation and source of income for agricultural labour households in Meerut villages and one that is continuously expanding.

The credit status of casual labour households showed that in Ballia villages 80 per cent of casual labour households had outstanding debt at the time of survey whereas in Meerut villages more than 90 per cent households were under debt. In Ballia 60 per cent had outstanding debt ranging from Rs 1,000 to 5,000 whereas 75 per cent in Meerut had outstanding loan above Rs 5,000. Seventy three per cent and 68 per cent households used this credit for consumption needs such as marriage, death ceremonies or medical requirements etc. in Ballia and Meerut villages respectively. In Ballia villages landlords turned out to be the single most important source of credit to the labour households whereas in Meerut dudhiyas are the most important source of credit to the labourers. This needs to be elaborated.

Dairying has always been an integral part of the rural economy of Meerut [Sharma and Poleman 1994: 115]. Importance of dairying can be known from the cropping pattern of the state where the area under wheat is 30 per cent, sugarcane 34 per cent and the third highest importance accrues to fodder crops in which 21 per cent area is cultivated [Agricultural Statistics of Uttar Pradesh 1994-95]. Apart from this, sugarcane tops (‘agola’) are valuable because of their use as green fodder. Throughout the year, women from labour households are out looking for fodder. There are no pastures in the villages and the need for fodder is so pressing that labourers in return for weed grass or sugarcane tops do weeding and sugarcane harvesting. Not only this, if sugarcane harvesting is delayed till January-February or March, when fodder is scarce and expensive, labourers are satisfied in receiving two-thirds or half of sugarcane tops as their wages for sugarcane harvesting.

A national level study in early 1980s found that most milk produced in the country comes from small producers with one or two milk giving animals [Sarma 1981]. Dairying in Meerut conforms to this pattern where all but few labour households are engaged in this activity. It has been stated that Indian Rural Development Programme (IRDP) enabled 30,000 households in the less privileged category to purchase milk animals in Meerut district.5 But in the study villages, the role of dudhiyas has been very crucial in advancing loan to labour households, dudhiyas not only extend credit to these households for purchase of cattle, but actively participate in the process of purchase and many times they themselves purchase animals and hand them over to the labour households. The dudhiyas, by doing this, ensure supply of milk from these households at a lower rate than the market rate. At the time of the survey the market rate for milk was Rs 10 per litre, but the dudhiyas were collecting milk at the rate of Rs 8.30 per litre or Rs 8.50 per litre. This is a novel form of interlinked transactions emerging in Meerut villages. The dudhiyas are adopting a very aggressive policy of lending in these villages and to keep these labourers in a dependent relationship, they continue to offer credit for other purposes as well. After the labour households have repaid their loan, they are induced to take loans for another purchase of animal. Thus the relationship is prolonged. Repayment of loan is made in terms of milk to be sold to these dudhiyas every day without any payment. At the end of the month accounts are settled.

Interlinked Contracts of Casual Labour Households in Agriculture

Having limited ownership of income earning assets as shown above, these households face an economic compulsion to enter into interlinked contracts with their employers. Two types of interlinked contracts have been noticed, (a) land, labour and credit contracts of landless-lessees and (b) credit-labour linkages of casual labour households.

(a) Tenancy contracts and associated linkages: Among the casual labour households 23 per cent or 21 out of 93 households leasein land in Ballia whereas 18 per cent or 8/43 lease-in land in Meerut villages. Ballia: Out of 21 tenants, 57 per cent or 12/21 took loan from their lessor. These tenants had taken land on fixed cash rent tenancy and in most cases the lease money remained outstanding. Fourtytwo per cent tenants reported to be paying a monthly interest of 5 per cent while the rest were paying zero per cent. Sixty seven per cent said that they would pay back loan in cash at the end of the cropping season. Members of all the 12 (100 per cent) tenant-labour households who took loan from their employers perform priority services for their landlords whenever called for. Out of which 42 per cent indebted tenants reported working for their respective landlords at a lower than the market wage. The proportion of women going from these households to work on landlords’ fields was relatively higher. At the end of the lease term, final adjustments are made and sometimes if the lease transaction is renewed, credit of the tenants rolls over to next year. A quarter of all tenants also rear calves for the landlord on a share basis. No tenant household performs unpaid services or obligatory services for the lessor.

Sample of 40 landowners showed that casual labour hiring is very common among cultivators belonging to all size classes.

Economic and Political Weekly January 13, 2007 Small cultivators operating two bighas also reported hiring of labourers for certain operations such as ploughing and harvesting. Labour hiring is most common for harvesting and post harvesting operations of threshing and carrying. To secure labourers at crucial times or to control labour supply, cultivator households use their tenancy contracts. This was evident from the fact that only 8 per cent cultivator households were leasing in land whereas a much larger proportion of landowners (55 per cent or 22/40) were leasing out land in the range of 2-15 bighas. Out of these lessors, only two were absentee landowners who leased-out all their land, rest of the landowners leased-out only a small proportion of their land.

When asked about the reasons for leasing out land, landowners revealed that distribution of land in many fragments and the difficulty of its management formed the most important reasons. Moreover, it ensures the availability of labourers from tenant families whenever required. Economic and social status of lessor and lessee reinforced the fact that lease transactions for them are multi-purpose transactions. All lessors belonged to bhumihar caste that possesses most of the land in surveyed villages. Lessees were mostly belonging to ahir, mallah, kumbhar and chamar castes, which in social and economic hierarchy are inferior to bhumihars. Also, leased-out land parcels are much smaller than the land operated by these landowners themselves; hence most of the leasing out also takes place in many parcels and to many households which makes the position of landowners stronger. Most lessees are either landless labourers or are marginal or small holders. Proportion of landless labourers leasing in land is much higher than the proportion of landed households. Although there were 22 lessors, but 52 transactions of leasing out took place and on an average leased-out land was parcelled out into 2.38 units per household. To enforce such contracts personal relationships are cultivated over a prolonged period. Such type of tenancy transactions with stronger lessors and weaker lessees in Ballia are common and interlinkages between land, labour and credit markets are an integral part of these transactions.

On the whole, labour households in Ballia villages do not own any land and a limited number have access to land through leasing in. However, their complete dependence on lessors for land and also for credit make their position weaker and therefore they are forced to commit their labour on a priority basis or at rates lower than the market wage. This is the basis of the continuation of interlinkages between land, labour and credit markets mainly under fixed cash rent system. Meerut: Leasing in of land by the labour households is lower (18 per cent or 8/43) in Meerut than in Ballia. Interlinkages, however, are common among these transactions. Most of these tenant households also own some land of their own. Leased in pieces usually measured less than two ‘kuccha’ bighas. All eight lessees were also indebted to their landowners and 87.5 per cent were paying an interest of 3 to 5 per cent. All of them also worked for their landowners on a priority basis. Another 57 per cent reported that final adjustment is made at the end of the cropping season in terms of crop share and labour days worked for the lessor; 20 per cent revealed that they are supposed to repay in terms of cash at the end of the cropping season. However, it was crucial to note that unlike in Ballia none of them reported receiving less than the market wage.

A sample of 48 landowning households showed that cultivators from all size-classes hire casual labourers and during the post green revolution period there has been a sharp increase in the demand for labour. Increased cropping intensity (170 in the surveyed villages) with most of the area being double or triple cropped with 100 per cent irrigation, range of activities for which labour is required is much larger compared to activities in Ballia. Most common crop operations for which casual labour is hired in this region are harvesting of wheat and sugarcane, cane-tying, manuring and weeding. Peak activity periods are much longer in this region. Long cropping season and much longer harvesting process required of sugarcane prolong the peak period of kharif season. Increased profitability of land in the post green revolution period has led to the near extinction of yearly tenancies in the study villages.6 Most lease transactions in this region are shortterm seasonal leases for a specific crop. Peas, potato and paddy are the crops for which such lease transactions take place and, for all other crops except paddy, land is leased-out on a fixed cash basis. For paddy crop sharecropping is practised. Leasing in or out of land is relatively scarce in this region, where only 19 per cent cultivators (9/48) were found to be leasing out while 15 per cent (7/48) were leasing in land. Out of nine leasing out transactions three (33 per cent) were for paddy crop and rest 66 per cent were for potatoes and peas. In other words, only 6 per cent cultivators leased-out to labourers for paddy cultivation and 13 per cent cultivators leased-out land for other than paddy crop.

Responding to the question regarding reasons for leasing out, all the lessors stated that it is to improve the quality of fields that the land is leased-out for a specific crop such as potatoes or peas for a season. It is a method of resource adjustment by the farmers, who want to follow a certain pattern of crop rotation scheme for their fields to enhance soil fertility. These cultivators who are not able to grow a particular crop of potatoes or peas, as it requires different kinds of resources, lease out land. The lessees in this case are mainly medium and big landowners specialising in these crops and who have access to suitable resources.

Only for paddy cultivation there is a traditional practice of leasing out land to labour households on a sharecropping basis because of the difficulty to get casual labourers for this particular crop. This has evolved mainly as a form of labour mobilisation for non-mechanised labour-intensive paddy crop. Labour households receive one-third or one-fourth share and mainly contribute labour, whereas all the other inputs are supplied by the landowner. It is very similar to the piece wage system where entire household rather than individual labourers is hired. Search and supervision cost is thus curtailed.

It follows from this trend that for all the crops, except for paddy, lessor and lessee come from similar social and economic background and interlinkages in such leases are not important. For paddy crop, however, the lessor is strong and the lessee is weak. But there were so few of such transactions, although all such transactions had features of interlinkages between land, labour and credit markets. Leasing of paddy lands has drastically come down with the increased use of casual seasonal migrants, regular supply of casual labourers from nearby villages and long-term seasonal migrants who fulfil the supply requirements of labour in these villages. On the other hand, it also shows decreased dependence of local labour households on cultivators for employment or credit.

One can conclude from these evidences that importance of interlinkages under the tenancy transactions is limited by the limited incidence of tenancy transactions between cultivators and labour households.

(b) Credit-labour linkages: Ballia: Those labour households who lease in land, enter into interlinked transactions implicitly or explicitly, as already noted. But apart from these, there are casual labour households who are not lessees but are dependent on the employers for short-term loans. They can get these loans only against a promise to serve their employers in the future, sometimes at a lower wage than the market rate. Here credit and labour markets get interlinked. This phenomenon is called casual labour-tying.

Out of total non-tenant casual labour households 39 per cent had outstanding loan from the landlords. Out of these creditorlabourers, 30 per cent reported that they are supposed to pay an interest of 5 per cent whereas the rest 70 per cent obtained interest free loans from their employers. Repayment of loan includes working for landowners on a “priority” basis. Secondly, loan is also adjusted by rearing calf/s on a share basis and 64 per cent indebted agricultural labour households were found to be engaging into this activity. Under this system, a “beck and call” type of relationship is developed between landowner and labourers. Most of the labourers revealed that in such a case landowner pays 10-15 per cent lower wage than the going market wage. The rate of interest on such loans was about 4-5 per cent per month.7 However, for some other labourers no interest rates were charged. These are informal systems of credit and interest where all such transactions are oral and mortgaging is generally not required.8

Landlords are still an important source of credit for these labourers for sums consisting of a few hundred rupees. Lack of alternative sources of credit compels labourers to go to landlords. Patronage relations have weakened over time but labourers frequently refer to employers as their own (‘apne’) or not their own.9 Landowners extend credit only if they can extract labour from their debtors and not because of any other reason. Whenever the cultivators grant loans, it involves double transaction. Meerut: Casual labour-tying in Meerut is not very extensive as dudhiyas are the most important source of credit to labour households and only 7/35 or 20 per cent casual non-tenant labour households had outstanding loan from cultivators. Out of these 86 per cent reported paying interest of 5 per cent and rest obtained interest free loan. All indebted labour households perform “priority” labour for the landowners during the course of the year and the final loan is settled at the time of harvesting of rabi crop. Twenty-nine per cent of these labourers told that they would repay in cash by selling the crop at the harvest time. Sometimes this process continues to next year as well. In this respect it can be concluded that there exists casual labour-tying10 in agriculture but its extent is roughly half of what it is in Ballia villages.

III Market for ‘Group’ Migrant Labour

Terms and Conditions

This is an important form of labour arrangement emerging in Meerut during last decade following influx of long distance Bihari migrants.11 This type of labour arrangement from Uttar Pradesh has not been reported by any other study as yet. However, formation of such contracts in other parts of India is not so novel. For example, Athreya et al (1990: 143) describe the formation of such contracts in wet areas of Tamil Nadu where leadership of the “gang” is offered to the person whose parents have served as leaders in the past which according to them “…is also a proof that the Kothu system is quite old in the wet areas…”. In Meerut villages there is a regular flow of these migrants during peak periods of paddy crop, such as transplanting and harvesting which extends for about a month each in June-July and in October-November. At the time of survey there were about five ‘tolis’ or groups working for different employers in one of the surveyed (Dulhera) village.

As the name of the contract (‘toli mazdur’) indicates these labourers work in groups and have an informal group leader, who is one among them and negotiates the contract for the group as a whole. They are paid according to per bigha rate on a piece basis. Main crops grown in the region are sugar cane and wheat, though paddy takes about 5-7 per cent of net sown area. Paddy is grown as a cash crop as the staple food crop is wheat in this region. In the year 1999, when the survey was conducted, wages for the two main crop operations of paddy transplanting and paddy harvesting were paid at different rates. Transplanting, which includes removing saplings and replanting them in different rows, was paid at the rate of Rs 800 per 5 kuccha bighas (a little less than an acre).12 Harvesting, which requires cutting, separating the grain from the stock by threshing and loading harvested crop in trolleys, fetches higher than transplanting wages and is around Rs 1,000-1,200 per 5 kuccha bighas. All wages were paid after the completion of contract and no advance was given to the groups. Wages paid to all the groups working in the village during a season were same and no inter-group variation was observed. Apart from wages, incentives offered to these groups are in the form of shelter for the days they work and the ration for the workdays, along with other requirements like firewood to cook food. One member generally cooks for all and carries the food to the work site while others work on the field to minimise time loss. Since the wages are paid for the whole contract, labour groups work intensively and the supervision cost to the employer is curtailed. Payment is normally shared equally by all members of the group including the cook. This type of group formation has been called ‘Fraternally organised gangs’ [Athreya et al 1990: 143], where ordinary member of the “group” takes on the role as the group leader. Apart from this, another variant has also been discussed in studies where “groups” are organised by labour contractors who act as middlemen, take their commission, supervise labourers and have a higher status compared to labourers of their gang [Athreya et al 1990]. In the former category are studies by Rogaly (1996: 150-52) from West Bengal, Sarap (1991: A-171) from Orissa and Kapadia (1996: 269-76) from Tamil Nadu. In the latter category are studies by Breman (1984: 131-42) from Gujarat, Gill (1984: 962) from Punjab, Binswanger et al (1984:154) from Andhra Pradesh, and Janakrajan (1984: 413-16) from Tamil Nadu.

Recruitment of seasonal “group” labourers is relatively more formalised than the recruitment of long-term in-migrants or local casual labour in Meerut. The farmers personally contact these Bihari labourers who migrate to Meerut city and reside in slum areas called Bihari colonies. Wages are thoroughly bargained for. Once the initial contact between the labourers and the concerned farmer is established, things become simpler for the other farmers of the same village or nearby village/s and other tolis for the specific season. Leadership is established from both sides in setting the terms of exchange between the two parties and the

Economic and Political Weekly January 13, 2007 others in the village more or less follow these terms and conditions.13 Sometimes there are also contractors or middlemen whom employers contact and they arrange for the work gangs. However “leadership wage” plays an important role in wage fixation in both these types of contracts.

Supply Side

These groups contain only male labourers and women do not form part of these groups. This observation is in contrast to most other studies reporting group contracts where no exclusion of women are reported from such contracts including the one in north India [Gill 1984:962]. For example, Athreya et al (1990: 141) state that in Tamil Nadu groups are formed for special operations, exclusively by men for spadework, women for transplantation and a mixed one for harvesting. Janakrajan (1997: 403) also shows that specialised gangs for different crops such as for banana cutting, banana planting, Korai cutting are organised. Kapadia (1996: 272-76) also draws our attention towards group formations by women. Other studies reporting inclusion of women in “groups” are by Sarap (1991: 171) from Orissa and Breman (1984: 135) from Gujarat. In Meerut, however, only men migrate seasonally without women and families in general and the issue needs further exploration.

Binding factor for these groups are many, such as commonness in place of origin, caste and even age. All the members of the three groups surveyed belonged to Purnia district of Bihar and all of them were lower caste Muslims and were in the age group of 18-30. Groups are more or less homogeneous in this respect. Group size varied from seven to12 persons. Some of the members are coming to Meerut villages since the last six years or so and many others had come for the first time. The person who is more experienced compared to the newcomers, and is relatively educated and smarter acts as a leader and has influence over other members. At the time of survey, in the month of November these groups were planning to stay for about 30-40 days at one stretch in one village. Some of them had already worked in two to three nearby villages in the same season.

In other parts of north-western region such as Punjab or Haryana, seasonal migrants started arriving from eastern regions of India during the 1970s following increased demand for labour during post-green revolution period. But in Meerut region this phenomenon was apparent only in the early 1990s. The striking feature of these migrants is their pattern of movement, where some of them first go to Punjab where paddy is sown early and harvested early, then they move to Meerut where paddy is sown and harvested slightly later and at last they travel back to their native place where paddy is sown and harvested at a still later date. This opens up another area for future research.


Employment of group migrant labour was not restricted to large or medium farmers and cultivators of all size classes employed these labourers. The most important pattern of employment of these labourers, however, was related to the cropping pattern. They were more often employed for paddy crop than for any other crop. Only 2/21 or 10 per cent paddy cultivators from the sample did not employ group labour and cultivated paddy by leasing out land on sharecropping basis to local labour. All the others cultivated paddy with the help of group migrant labour.

Employment of seasonal group labour has exhibited an upward trend during the last decade in Meerut villages. It has happened because of the working of both demand and supply forces. The demand pattern has altered because gradually land has become scarce in this region and the increased productivity of land has made employers reluctant to lease out land on a sharecropping basis. Rice being a high value commercial crop, cultivators resent sharing the produce with the labourers. It is difficult to mobilise local labourers on casual wage payment for paddy crop in Meerut, as traditionally it is cultivated under the sharecropping arrangement.14 At the same time supply of migrant labour from eastern part of India has increased resulting in the formation of group labour contract. This trend represents resumption of land, which was leased-out under sharecropping arrangement, for selfcultivation and cultivating the same with the help of casual labourers. During the post-green revolution period in north-west India tenancy in general has declined and gradually annual lease transactions were replaced by seasonal leases for specific crops [Lerche 1999: 188; Srivastava 1996: 237]. These seasonal leases are now being replaced by the self-cultivation with the help of “group” migrant labour.

Another incentive for cultivators to hire group migrants is the lower cost of these labourers. Average wage payment to group labour for paddy transplanting and harvesting together in a yearly crop cycle was Rs 391 per bigha whereas wages of the sharecropper paid in terms of the crop-share15 turned out to be between Rs 650 for one-fourth share and Rs 866 for one-third share per bigha. Even for wheat harvesting in which the use of group labour is very limited, wages paid to them were lower than the wages paid to local labourers. Local labour was paid 25 kg grain plus 25 kg husk, which on conversion came to around Rs 200 per bigha.16 Group labour, on the other hand, was paid Rs 175 per bigha for the same job. Therefore, it could be inferred that the employment of “group” migrants is reflecting a decline in wages because of increased supply of labourers and the changes in contract terms from sharecropping to piece wages in cash. Other economic advantages of employing in-migrants is the lower search cost as the contract is settled with the group leader and he owes the responsibility of organising the group and the employer saves on the cost of searching individual labourers. In addition, supervision cost shrinks because of the piece-contract which induces labourers to work with self-discipline and, given the homogeneity within the group, work is completed on time during peak periods without many hassles.

Apart from these economic advantages, in-migrants are preferred because they are docile and easier to govern and out of the local politics [Lerche 1999: 199-205]. Moreover, coming from paddy growing regions, people in Meerut perceive these Bihari migrants as efficient and skilled workers compared to the local labourers.

IV Conclusions

Labour households in Ballia are economically weak and possess no assets either in the form of land or cattle. Also there seems to be limited allied or non-agricultural employment opportunities in or around the villages. In the off-season labourers look for casual construction jobs. Their mainstay is agriculture and therefore their dependence on landowners is compulsive. Since there are hardly any other sources of credit, labourers have to frequently borrow from the landowners against a future commitment of labour. It is their pressing need for money which forces them to enter into interlinked contracts. This is the reason that even under casual labour contracts incidence of interlinkages are highly significant in Ballia. Here the economy seems to be moving slowly and no apparent change is visible.

On the other hand, labour households in Meerut are economically better off as a large proportion own land as well as cattle. The economy of Meerut is showing dynamic features with expanding income earning opportunities in the non-agricultural sector as well as opportunities of diversification to labour households into dairying where around 80 per cent labour households were involved in dairying. Growth of non-agricultural employment has also been noted by other studies from western Uttar Pradesh: for example, from Muzaffarnagar by Srivastava (1996, 1999) based on 1977-78, 1985-87, 1990-91, 1993-94 survey, from Jaunpur and Muzaffarnagar by Lerche (1995, 1999), based on 1992-93 and 1998 survey, from Meerut by Sharma and Poleman (1994) based on 1988-89 survey, from Aligarh by Saith and Tankha (1997) based on 1972 and 1997 survey, from Moradabad by Dreze and Sharma (1998). A typical labour household in these villages would have young men migrating to nearby urban centres for casual or short-term jobs, whereas women and old men are self-employed in dairying and cultivation of small owned plots. As a result interlinkages of labour households in agriculture are fewer and continuously declining. However, inadequacy of credit institutions is strikingly pointed out by the emergence of interlinkages in dairy market. A new type of interlinked transactions with dudhiyas is gaining strength where buffalo, milk and credit transactions are taking place.17

The commonality between Meerut and Ballia, however is in terms of insufficiency and inadequacy of formal credit institutions in taking care of the needs of agricultural labour. That is why interlinked transactions are not only surviving but are being modified and developing into other markets such as in dairying. This observation is quite in contrast to Pal’s (1997: 142) analysis of Andhra Pradesh, where she asserts that interlinkages and along with it regular labour contracts have declined due to cheaper provision of credit.

Interlinkages were thought to be an institution prevalent in a semi-feudal society and development in general should have led to elimination of such institutions which are personalised and are highly unequal in favour of landowners. However, as has been shown in this paper, interlinkages are not only surviving but have been reinforced by the changing conditions. On interlinkages, there has been a mixed response in the surveys from Uttar Pradesh. For example, Dreze and Mukerjee (1989: 246-52) in Palanpur found no evidence of interlinkages. On the other hand, Srivastava (1989, 1996) provides evidence of interlinkages from both eastern and western parts of Uttar Pradesh. From other parts of India, studies which found interlinkages are by Bharadwaj and Das (1975), Rudra and Bardhan (1978, 1981), and Breman (1974). Binswanger and Rosenzweig (1984: 168) found interlinkages only under farm servant contracts. Apart from agriculture, interlinkages have also been described in fishing by Platteau et al (1985).

It is the involvement of local labour households into various occupations in Meerut that has led to an increase in the formation of contracts with in-migrant labour. This has happened with a lag where growth of non-agricultural employment was noted during late 1970s and 1980s whereas the growth of the labour contracts with in-migrants is noted only during late 1980s and 1990s. Increased migration of labourers has expanded the labour markets where high wage regions such as Meerut are experiencing influx of in-migrants from low wage regions. Entry of in-migrants in turn is depressing wages for labourers in high wage regions, which may be the beginning of the process of convergence of wages across regions. This is evident, as the wages received by the “group” migrant labour is lower than the implicit wages of the local sharecroppers in paddy crop or piece wages in wheat harvesting.

Growth of group labour contracts in Meerut can be “regarded as a kind of proto-union” as Athreya et al (1990: 158) put it. Athreya argued that these gangs are able to get wages above minimum wages whereas individual migrant labourers are not able to get such a deal. In Meerut villages, since group labour contracts are important in the context of in-migrants, these labourers are better off as compared to in-migrant labour who work as attached labourers at a much lower wage rate. Groups of labourers have greater bargaining power and also command greater respect from their respective employers particularly so in fraternally organised gangs such as in Meerut.




[This paper is a revised version of a part of the author’s PhD thesis submitted to the Jawaharlal Nehru University. The author is extremely grateful for the guidance and encouragement given by Kusum Chopra. Special thanks are also due to Ravi Srivastava for extensive comments and suggestions which helped in finalisation of this paper. However, the responsibility for any error and omission is that of the author.]

1 In all 278 households were surveyed both from Meerut and Ballia. The sample size formed 25 per cent of the agricultural households in each surveyed village as per 1991 Census from each of the two strata:

(i) landowners or hirers of labourers, and (ii) agricultural labour households. Questionnaires, direct observation and interactive approach was adopted for data collection during 60 days of continuous residence in each of the regions.

2 After the independence when the Uttar Pradesh Zamindari Abolition Act was passed in 1951, its programme on land ceiling was not implemented till the 1960s. In the early 1970s and 1980s under the new ceiling plan, the government distributed 1,309 acres of land to poor classes in Meerut district. Landless labour households in surveyed villages were the beneficiaries under this programme.

3 This is quite a common practice in Ballia villages. In this deal, generally, a landowner leases out the calf, when it is born, to the labourers for feeding and raising. Labourers feed them till they become useful for either milk purposes or for transport. They are then sold and the money is shared on a 50:50 basis with the landowner.

4 On the way to these villages from Meerut city, we witnessed a scene where between 6 and 7 am the top of most private buses going to the city and other vehicles were full with milk cans and between 8 and 9 am, one can see buses coming from Meerut city full of empty cans on top. Apart from that a large movement of dudhiyas on motorcycle carrying milk cans to and fro to Meerut from various villages.

5 Meerut, District Rural Development Agency, 1989, Quoted by Sharma and Poleman (1994: 117). 6 For similar observations regarding tenancy in north-west region of India, see Lerche (1999: 189); Srivastava (1996: 233).

Economic and Political Weekly January 13, 2007

7 For similar findings, see Srivastava (1999: 263-72). 8 For similar findings, see Rudra (1984: 273). 9 For similar observations from Muzzaffarnagar, see Lerche (1999)

10 Binswanger et al (1984: 146) shows that in Andhra Pradesh and Maharashtra villages daily rated workers cannot get loan from employers on the promise that they will work for them in the future. On the other hand, Bardhan-Rudra (1983: 9) show that in West Bengal there exists casual labour-tying.

11 Sharma and Poleman (1994: 113) note that unlike in Punjab, Meerut and western Uttar Pradesh did not experience a large-scale influx of migrant workers from eastern Uttar Pradesh and Bihar. The process of seasonal migration and permanent migration in Meerut district is in the incipient stage and is likely to increase.

12 Five kuccha bigha is equal to 30 biswa and one acre is equal to 32 biswa.

13 Bardhan (1984: 7) talked about wage leadership model in the villages of West Bengal.

14 There are other studies from west Uttar Pradesh, which show that seasonal sharecropping arrangement is common for paddy crop. See Lerche (1999) and Srivastava (1996: 237).

15 Sharecroppers’ share varies from one-third to one-fourth of the produce. Their share is calculated on the basis of average productivity of this particular crop as reported by the cultivators multiplied by the then prevailing price of the paddy. There is one limitation of such comparison ie we do not have data related to time spent by the sharecropper on the operations other than transplanting and harvesting. Here we are also assuming that the sharecropper spends most of their time on transplanting and harvesting.

16 Price of wheat was Rs 7 per kg and the price of husk was Re 1 per kg. These prices were the current prices prevailing at the time of survey.

17 This theme needs to be further researched.


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