Karnal/Ambala/Ludhiana: A serious shortage of migrant labour from Bihar, Jharkhand and Uttar Pradesh is slowing the government’s efforts to buy wheat in Punjab and Haryana. This could, despite a record harvest, derail its plans to replenish the country’s food stocks and cool inflationary pressures.12ebde00-15cf-11dd-8c4b-000b5dabf613.flv

These two states account for more than 90% of the government’s annual purchase of wheat, which is then sold at subsidized prices to the poor. On 6 April, the Central pool that includes stocks the Food Corporation of India, or FCI, and state governments maintain, had 5.79 million tonnes, or mt.

The government has estimated that this year India will touch a new high of 76.8mt in the rabi, or winter crop, season. Farmers, commission agents and state officials at the grain markets in Punjab and Haryana estimate the total arrival of wheat to be 20-25% more than last year.

But, scarce labour is hurting purchase.

At Khanna, one of Punjab’s largest grain markets, huge piles of wheat sacks lie in the open waiting to be lifted and placed in warehouses.

“The wheat arrival this year up till now (25 April) is already more than the total arrival of 0.7 lakh tonnes (in Khanna) in the entire procurement season (April to June) last year. Moreover, we expect an additional 25% of wheat in the coming days. But, migrant labourer shortage is that of at least 25%," said Lakhbir Singh Kalalmajra, a commission agent and president of the Khanna Rice Seller Association.

Thanks to the government’s minimum support price of Rs1,000 per quintal, or 100kg, up from Rs850 last year, farmers want to sell only to FCI and not local flour mills or any other private company.

Logistics problem: At Khanna, one of Punjab’s largest grain markets, wheat sacks lie waiting to be lifted and placed in warehouses. (Madhu Kapparath / Mint)

The scenario is no different in Haryana, where officials are also strapped for warehouse space to store grains.

Just outside Karnal, 115km from Delhi, sacks of wheat are lying on the pavement where arhtiya, or commission agent, Bhupinder Singh and Joginder Singh, a farmer owning 5 acres, had just closed a deal. Arhtiyas work as middlemen between FCI and farmers and take a 2.5% commission.

“Thanks to the extended winter and early sowing, Haryana has seen a higher production of wheat this season. I have no space left in the FCI godown to keep these bags," said Bhupinder Singh.

Around 50km ahead, the grain market in Ambala is full of piled wheat sacks with nobody to lift them. “There is severe shortage of labour this year. Only half the labourers who used to come from Bihar and Jharkhand have come this year. There is nobody to do the loading and unloading," said Amardeep Singh, a farmer who owns 40 acres.

There are two kinds of labourers. Kacchi labour, those hired by arhtiyas to sort and pack wheat, are paid Rs2.80 to carry each bag weighing 50kg. Pakki labourers employed by contractors to load and unload bags are paid 40 paise per bag.

Ahmad Muneer, a resident of Godda district in Jharkhand, said, “Many from my village did not come this time since they have started getting work under the employment scheme (National Rural Employment Guarantee Scheme or NREGS)."

The shortage is also pinching farmers. “The Bihari labourer is about 20% cheaper than locals," said Sujaan Singh, a Haryana farmer.

NREGS, India’s flagship welfare initiative, promises at least 100 days of work in a year to one member of a poor rural family.

Ramesh Chand, professor at the National Centre for Agricultural Economics and Policy Research, says this is not the only reason for the shortage.

“NREGS will definitely have an impact. But central and eastern India is also seeing a resurgence of agriculture. These areas are going to be the new food bowls, unlike Punjab and Haryana where yields have plateaued. Until there is a huge wage difference, fewer people will leave home," he said.

Chand says the labour shortage is unlikely to cause serious damage. “There will be some problem in case it rains but temperatures heading 40 degrees Celsius will dry any extra moisture and save the day."

Another fallout of the shortage is the long queues of trucks outside FCI depots. “Unlike previous seasons, when I could ferry (wheat) three times in a day, this time it is taking almost three days for one ferry. There is simply not enough labour to unload the wheat," said lorry driver Kishen Kumar. To compensate the truckers, the arhtiyas are paying them a premium.