Home >Industry >Karnataka seeks Rs1,788 crore from Centre to deal with rural labour crisis

Bengaluru: Karnataka has become the first state to alert the Central government that it is not raining in excess everywhere in India this monsoon. In a letter to Prime Minister Narendra Modi, Karnataka chief minister Siddaramaiah has asked for 1,788 crore to mitigate a possible labour crisis in the state owing to deficit rainfall this year.

Krishna Byre Gowda, agriculture minister of Karnataka, said it “is a way of acting proactively" even as Karnataka has not yet technically declared a drought. Notably, the state was the first to declare drought in India in August last year, and also the first to record failure of the winter crop early this year, a situation which sharpened rural distress and pushed many farmers to indebtedness and/or suicide.

According to the letter, the ground reality of farmers this Kharif season remains grim. Thanks to the sixth consecutive year of deficient rains, the reservoir levels in even south interior Karnataka and Malnad areas (which fall on the slopes of the Western Ghats) are less than 50% of their normal capacities even as the monsoon has reached its last leg, as per the letter. Sowing in these areas, which used to be comparatively wetter that arid north Karnataka regions, has reached only 60% against the normal sowing area and, as per the initial assessment, even the crops sown are expected to have stunted growth, the letter reads.

Siddaramaiah’s office released the letter to the media on Thursday night, hours before he was supposed to fly to Delhi to meet some Union ministers.

According to Siddaramaiah, the request for 1,788 crore is to ensure timely payments for jobs under the Mahatma Gandhi National Rural Employment Guarantee Act (MGNREGA) programme, the demand for which is expected to peak at a high rate in the coming months.

Out of this, 288 crore will go in settling the dues the Centre owes on account of non-release of wage share towards MGNREGA programmes in Karnataka since 24 June. Another 500 crore is for labour and material payments until September end, and the remaining 1,000 crore for wages and material payments for the entire fiscal year 2016-17.

At present, about 300,000 people are being employed everyday in Karnataka under MGNREGA, which the letter says was instrumental in providing financial security to the poorest of the poor and preventing mass migration from drought-affected areas. However, the letter suggests that the government is short of cash to finance it anymore.

Owing to the popular demand for the scheme after last year’s drought, the state spent nearly 240% more than the budgeted amount at the beginning of the year and 56% of the current year’s labour budget on it, as per the letter. And then, in order to tide over the financial crisis due to the delay in wage payment by the Centre, the state government advanced more than 450 crore in excess of the mandated state contribution.

Gowda told Mint over phone that the government foresees loss of jobs this year for a huge number of farm labourers associated with the paddy sector. The state is intervening to prevent paddy farming this year because of the alarmingly low reservoir levels.

By the end of September, the state foresees another 475,500 person days likely to be generated under MGNREGA because of this impending labour crisis, which itself may lead to an excess expenditure of 866 crore over and above the budgeted amount, the lion’s share of which has to be borne by the Centre, according to the Act.

“There is still time to declare or not declare drought. The rainfall may improve, but paddy areas are already affected. So we are recommending this as an alternate measure," Gowda said.

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