Economic Survey questions MGNREGS demand spike, reverse migration

Says price rise in perishable food items due to production seasonality

The Economic Survey of 2021-22 has questioned the popular notion that the surge in demand for jobs under the Mahatma Gandhi National Rural Employment Guarantee Scheme (MNREGS) immediately after the first lockdown was the result of reverse migration.

Basing its analysis on state-level data, the Survey said that the latest work demand pattern for the scheme in FY22 shows that for many migrant source states like West Bengal, Madhya Pradesh, Odisha, Bihar, MNREGS employment in most months of 2021 was lower than the corresponding levels in 2020.

While, in contrast, the demand for MGNREGS employment has been higher for migrant recipient states like Punjab, Maharashtra, Karnataka and Tamil Nadu for most months in 2021 over 2020.

There are still other states that do not neatly fit into this categorisation.

“Therefore, the relationship between MNREGS employment and movement of migrant labour during the last two years cannot be conclusively determined, and requires further research,” the Survey said.

It acknowledged though that even after accounting for seasonality, demand for MNREGS work at an aggregate level still seems to be above the pre-pandemic levels of 2019.

Meanwhile, for agriculture, the Survey said despite the inherent resoluteness of India’s agriculture sector, it is bogged down by seasonality in production and irregular shocks leading to variations in prices, particularly that of perishable commodities.

In an analysis of seasonality in production of three main perishable food items – onions, tomatoes, and potatoes – the Survey said the prices of these items tend to rise between February and April, July-August, and September-November thereafter.

It advocated strategies to incentivise production during the lean months that could include investments in processing of surplus crops like tomatoes and building storage infrastructure for onions.

Interestingly, the Survey called for a calibrated import policy for agriculture products and said knee-jerk reactions to rise in prices of essential commodities through frequent import duty or tariff revisions sends wrong signals to domestic producers and creates uncertainty.

“A long-term consistent approach is mandated,” the Survey said.

“The performance of the agriculture and the allied sector has been resilient to the Covid-19 shock. However, as shown by the latest Situational Assessment Survey (SAS) report, the fragmentation of landholdings has led to alternate sources such as livestock, fishery and wage labour becoming significantly important for an agricultural household,” the Survey said.

Meanwhile, on other aspects of social infrastructure, the Survey said as a result of government spending on social services increasing by 9.8 per cent year-on-year in 2021-22, school infrastructure – both in terms of number of recognised schools and colleges and basic facilities in schools – and teachers’ availability as reflected in Pupil Teacher Ratio, showed an improvement over earlier years.

On health, it said the latest National Family Health Survey-5 showed that Total fertility rate (TFR) has come down from 2.2 in 2015-16 to 2 in 2019-21, while under the Jal Jeevan Mission (JJM), 83 districts in the country have already become ‘Har Ghar Jal’ districts.