It is a common sight in much of the developing world and especially in low-income countries like our own. Along the roadside, we can see hundreds of workers piling up mounds of rubbles for road construction. From what I have observed, most of the workers are women, many with babies wrapped around their backs. Stone-breaking is one of most arduous works. It is amazing to see how people can spend months and years doing this kind of work just to sustain basic life!
Similar backbreaking activities include using ploughs and shovels to prepare land for cultivation; planting of paddy while standing knee-deep in mud; carrying merchandise overhead or on back for transportation to market; and walking dozens of miles in hot sun to reach the desired destination.
People have been engaging in these types o hard labor for time immemorial. These have been the standard practice of everyday life for most of human history, but fortunately, this is not the case now. We have technology and machines to help.
PHOTO: ESTUDIES.WEEKLY.COM
ROLE OF TECHNOLOGY
Today, the economic prosperity enjoyed by many countries—living standards much above subsistence level while their peoples do less backbreaking labor—is essentially an outgrowth of the greater use of modern technology in production and transportation. This has helped usher in an era of steady growth in the supply of goods and services for everyone—in progressively larger quantities and in ever greater varieties. This is what we know today as economic growth—steady expansion in the economy’s capacity to produce large amounts of goods and services, much exceeding population growth. Surprisingly, economic growth was largely absent as little as 200 years ago.
Given this background, let us view how technical knowledge and use of new equipment can help bring about economic growth, which is the key to improving people’s living standards. A 100 farm workers using ploughs and shovels can produce 100 tons of grains from a given acreage. The same group of workers trained to use modern farm machinery and equipped with tractors and harvesters can produce 10,000 tons working roughly the same hours.
Even discounting the capital cost of new machinery, the latter group of workers will earn many times more than the first group. More importantly, the group of workers using new technology can look forward to a steady gain in output and incomes, while those using traditional methods will remain stuck at a subsistence-level of living forever.
Looking around the world, high and low living standards in countries reflect, in large measure, the differential in the use of modern technology and advanced equipment. Those countries failing to or lagging behind in making such transition are the ones that experience low level of economic prosperity and witness widespread poverty.
BARRIERS TO TECHNOLOGY
If the use of technology is so important for increasing incomes and lifting living standards, why haven’t poor countries like Nepal acquired it? Why, for example, haven’t we replaced ploughs and shovels with tractors and harvesters; bullock-carts and horse buggies with railways and truck transport; and manual labor in construction with bulldozers and cranes?
We can imagine the scale of transformation of the switch to new production methods. For example, instead of two thirds of our workforce—about 10 million—eking out subsistence living from farming activities, we would need just one million workers to carry out the same work in a more humane and efficient manner.
Labor productivity will increase at least by ten times in just a generation and income growth will soar, which actually has been the experience of advanced countries and is happening now in emerging economies of the world—South Korea, Brazil, Chile, Malaysia—which were dependent primarily on subsistence agriculture just a generation or two ago.
The reason most countries have failed to take advantage of available of technology and new production equipment is that they are unwilling or unable to commit themselves to making this transition. The first obstacle is lack of capital—high national savings—which are needed to equip farm and factory workers with new technology and machines. The second—and more difficult—requirement is finding alternate employment for those displaced from their traditional line of work—in farming, manufacturing, construction, and transportation.
Because of the perceived difficulty of turning a subsistence economy around, it is not surprising that no more than one in ten countries has succeeded at this task, while most others remain mired in poverty.
Fortunately for Nepal, there is now a better prospect of making this leap from subsistence to a market and industrializing economy. The help comes from an unexpected source—labor migration. We do not know precisely how many of our workers who were earlier engaged in farming have migrated overseas but their numbers are huge—may be 3 to 4 million, including those migrating to India for seasonal work. If this number is correct, this represents a huge loss to our farm economy, based almost entirely on manual labor.
In most Nepali villages all able-bodied men and some women have left the place—temporarily or for good. This has created a huge shortage of farm labor. It is not unusual to see large chunks of farmland lying fallow or only half-cultivated. More importantly, multiple cropping and commercial farming prospects have dimmed, largely because of the unavailability of farm labor.
From another perspective, such extreme shortage of manual labor leaves room for the introduction of new technology in farming, in agro-businesses, and in dairy industry. Without such back-to-back development of agriculture and basic industries, it is hard to conceive of a productive farming sector which could become an engine of growth for the rest of the economy.
What then is needed to make this transition, from traditional farming to one that makes use of modern technology and advanced equipment? Government help is needed, but of a different kind than the commune system once practiced in China, which required government and community ownership of farmland, managed by government bureaucrats. Thankfully, other (better) choices are available that can help modernize our agricultural sector without direct government involvement.
The right way forward will be turning agricultural pursuits into a normal business enterprise—to be looked at as an investment avenue for profit-making. This will call for outright lifting of current practice of placing a ceiling on landholding, and allowing farmland to be transacted as an investment item—without limits or restrictions. The government will need a follow-up to make farmland leasable—meaning that the landowners unwilling or unable to cultivate their land can lease it out to others.
In the little space available here, it is difficult to elaborate on this new approach which could give our dormant economy, and our farm sector in particular, the much-needed momentum. However, a little reflection will help in coming up with new possibilities. If assessed properly and fairly, this new approach to farming could revolutionize the nation’s economic prospects and help lift the fortunes of millions.
sshah1983@hotmail.com
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