Republic of India Livelihoods in intermediate towns

1.3: Study and the Research Questions: Based on a field study of two large settlements in North Bihar district of Madhubani, each with a population size of more than ten thousand, and a significant engagement of the local workers in non-farm economic activities, this paper tries to explore the social dynamics of the “rural” non-farm economy by empirically examining the following:

1. 
   What is the range of non-farm occupations (and a broad mapping thereof) that have existed or evolved over time in the two “rural” settlements?
   

2. 
   How are these occupations organized and viewed socially in terms of their economic and social hierarchies and the differential incomes they provide and social status attached to them? Or, in other words, what kinds of dynamics of caste, community and gender operate within the social organization of the non-farm economy?
   

3. 
   How do patterns of migration to towns and other parts of the country/world shape the local non-farm economy and are, in turn, shaped by it?
   

4. 
   How do the changes in the local economy influence and are influenced by the local and regional structures of power and domination, including the administrative systems that influence (facilitate, encourage, obstruct) the growth of non-farm economy?
   

5. 
   How do the old structures of exclusion, such as caste hierarchies or community-based divisions, operate in the rural non-farm economy? Do communities tend to monopolize the valued occupations? Are there practices of discrimination against specific social groups and/or categories in the rural non-farm economy?
   

2. Historical Context of the Changing Rural Economy of Bihar

2.1: Introduction: In the textbooks for India’s political economy, rural Bihar has been best known for its backward “semi-feudal” agrarian social structure where the system of production and distribution were built upon interlocking land, credit and labour markets. The tenure holding upper classes of zamindars, almost exclusively drawn from the local level upper castes, controlled the social, political and economic life of the region. The upper middle castes, now known as the OBCs, cultivated land but tended to work as non-occupancy tenants (raiyats) and to a lesser extent, as traders and agricultural labourers. The lower middle castes, currently called the Extremely Backward Castes (EBCs) were mostly agricultural labourers and a smaller proportion worked as artisans and peasants. The Dalits or the Scheduled Castes were generally landless and worked as agricultural labourers. Thus, the system of ‘caste stratification of Bihar was almost identical to that based on the interests in land’ (Sharma 2005: 962).

A survey of 36 villages conducted by Pradhan Prasad and his team in 1981-82 tells us about the continued dominance of such social and economic relations in many pockets of rural Bihar even three decades after India’s independence. The failure of legislative measures on matters of land ceiling and redistribution (the Land Reforms initiated during the 1950s) coupled with lack of facilities for irrigation had kept the agrarian economy “backward” and the traditional caste hierarchies entrenched. Summarizing the core findings of their survey, Sharma writes:

…the vast majority of poor peasant households were ‘deficit’ ones, which forced them to take consumption loans from the land-owning class and which they were never able to return even in the long run, due to their being heavily in debt and deficit. This led to a system of informal bondage which assured the big land-owning class a number of benefits including availability of cheap labour, better terms for leasing out land, benefits obtained through distress sales and by acquiring poor peasants’ lands almost for nothing and the like (Sharma 2005: 963).
The 1981-82 survey also showed that until then the so-called forward castes were still largely big peasants and landlords, while scheduled castes were mostly agricultural labourers. The heterogeneous category of backward castes was spread across class groupings but each subgroup tended to be concentrated in one or more classes. Muslims were spread across the classes, with the largest concentration (about half) being among non-attached agriculture labour. Thus the interrelationship between caste and class was strong, but it was by no means perfect. This was also true of the relationship between class and landownership. One-third of the agricultural labourers were attached or bonded and the rest were in casual employment. The middle castes, particularly the three dominant castes, the Yadav, Koeri and Kurmi, had begun to experience some upward social mobility (Prasad et. al. 1988).
A research team from the Institute of Human Development (IHD) re-surveyed the same 36 villages in 1999-2000 (Sharma 2005; Rodgers et. al. 2013). They found that in most parts of the state, the “forward castes” were still big peasants and landlords and the Scheduled Castes were mainly agricultural labourers. Even for other castes, class configurations remained more or less the same. Notwithstanding this broad picture, the agrarian structure and class composition had undergone a significant change during the intervening period of around two decades.
The upward mobility of the middle castes, particularly of the dominant ones, towards higher classes in the hierarchy was clearly evident. The lower middle castes (the EBCs) had also consolidated their position over the years and a good number of them had risen to the rank of middle peasants. On the other hand, the proportion of big peasants among upper castes had declined and their proportions among the absentee landlords and non-agriculturists had increased. A small number of them had also joined the ranks of agricultural labourers, which did not appear in the earlier survey. The survey also found a significant increase in the proportion of non-agriculturists in the study villages.
The period between the two surveys had also witnessed a drastic decline in the proportion of attached labour, to less than 10 per cent of the total wage labour. Thus, casualization of wage labour emerged as the contemporary dominant trend. The percentage of casual workers to the total workforce had increased from 34 per cent in 1981-82 to 52 per cent in 1999-2000, the increase being mainly at the cost of self-employed and attached labour in agriculture. The casualization of workers had been the most significant among lower and middle level caste groups (the EBCs). This was a clear indication of declining structures of the traditional caste-centric patron-client relations and of “semi-feudal” dependencies.
The IHD team surveyed the same 36 villages once again after a gap of 10 years, in 2009. The pace of change had accelerated and by this time the attached labour had nearly completely disappeared from the rural landscape of Bihar (Datta et. al. 2012). These changes also induced out-migration, which in turn increased local wage rates and initiated other realignments in the local economy, polity and social relations, including an extensive growth of non-farm economy and employment. We return to a discussion of these changes in greater detail in the later sections of this paper, after a broad overview of the existing literature on the rural non-farm economy in India and Bihar.