13 October 2011
In this unpublished photo from the story, A Wounded Land, a boy plays in the rice paddy field by Kuttanadu, Kerala. (photo: Peter Lemieux)
Last week the India Ink blog on the NY Times’ web site posed an interesting question about the state of India’s poor: Has Globalization Helped India’s Poor?
Like the dog that didn’t bark, the study’s principal finding is a non-result: there is no systematic relationship between trade liberalization and inequality in India. Rather, a whopping 90 percent of inequality reflects differences at the level of individual households within states or within urban vs. rural areas, rather than between these groupings. And widening the lens from the household to the community, more than 60 percent of total inequality is found at the local level, within urban blocks and rural villages.
These highly localized roots of inequality have little to do with inter-state or rural-urban differences, to say nothing of trade or other international factors. Rather, they stem from factors that labor economists have long understood to be the drivers of inequality: education, work experience, family background, and, crucially in the Indian case, caste and ethnic differences.
In the January 2011 issue of ONE Peter Lemieux explored the financial crisis affecting the agricultural industry in Kerala, and the Syro–Malabar Catholic Church’s efforts to assist those affected.
The seeds of Wayanad’s agricultural crisis were sowed in the early 1980’s, when local farmers began converting their traditional, more diversified rice paddy farms into fields of one or two perennial cash crops, such as coffee, pepper, tea, cardamom, rubber and areca palm. From 1982 to 1999, land used for traditional paddies shrank by about 75 percent. Today, cash crops cover more than 80 percent of all agricultural land in the district.
While the conversion has made some farmers relatively rich, the trade off has been disastrous for most as well as for the district’s entire agricultural sector. In 1999, the Indian government began to liberalize its trade policies, opening its markets to international competition. Almost overnight, farmers in Wayanad witnessed the prices of chief crops, such as pepper, coffee and tea, plummet as cheaper produce from other countries, particularly Vietnam, flooded the market. In that year alone, pepper, a crop grown by most farmers in Wayanad, suffered a price drop of 76 percent.
For more from this story see, A Wounded Land by Peter Lemieux.
Tags: India Kerala Syro-Malabar Catholic Church Farming/Agriculture Economic hardships