After the Prime Minister’s referred to MGNREGA as a “monument to the failure of the UPA regime”, comes a report blaming it for creating shortage of farm labour.

A Federation of Indian Chambers of Commerce and Industry (FICCI)-KMPG report titled ‘Labour in Indian Agriculture: A Growing Challenge’, released here on Wednesday, says schemes, such as the Mahatma Gandhi National Rural Employment Guarantee Act (MGNREGA), have affected farm labour adversely and can have a negative impact on productivity and prices.

“This reduction in supply (of farm labour) alone with the support of a number of Government schemes, including MGNREGA, has led to an escalation in farm wages, which is adversely impacting the profitability of the farmer,” said A Didar Singh, Secretary General, FICCI.

Rural wages, he stated, have grown on average by 17 per cent on average since 2006-07 and outstripped urban wages while productivity has not increased.

The report found that between 2004-05 and 2011-12, farm labour declined by around 30.57 million while the total size of the workforce kept rising. The share of agri workforce during the same period declined from 56.7 per cent to 48.8 per cent.

Ashok Gulati, Chair Professor of Agriculture, ICRIER, told BusinessLine that questions like mechanisation had to be taken up and the report’s recommendations on dovetailing “MGNREGA with agricultural activities at the central level and establishment of a national common market are in the right direction”.

“At the State level, land policies and customised hiring need to take place. All this won’t happen overnight,” he said.

Alternative course Pravesh Sharma, Managing Director of the Small Farmers’ Agribusiness Consortium, an agency under the Department of Agriculture and Cooperation, refuted the need to promote excessive mechanisation.

“The US, China and the European Union, are growing more grain to feed the meat industry. This is not the case for India, so increased mechanisation cannot be a priority for India,” he said, suggesting sustained afforestation efforts, better transport and communication facilities would help farmers better.

Crop damage The recent showers across the country, which damaged significant amounts of the Rabi crop, are also likely to impact farm labour and wages, as also consumers.

“Whenever there is unseasonal rain and crop damage, labour demand and wages reduce. This is a temporary phenomena, however, and such incidents occur every three or four years,” said Ashok Vishandass, Chairman, Commission for Agricultural Costs and Prices, who released the report.

An assessment of crop damage is yet to be made, he said, with estimates ranging between 15 and 50 per cent. Wheat, mustard, potato, and a range of vegetables and fruits are believed to have been damaged across Uttar Pradesh, Haryana, Punjab, Maharashtra, Gujarat and Madhya Pradesh.

Rajya Sabha members had raised the issue in Parliament on Tuesday and demanded special relief packages and crop loan waivers for the affected farmers and also suggested special initiatives to be undertaken to study the impact of climate change on agriculture.