The Story of Village Palampur
Overview
The story of village Palampur is a story about a hypothetical village to help teach the concept of production. Farming is the main activity in Palampur. Manufacturing on a small scale, transport, dairy, etc are a few non farming activities that are done lesser than farming. To manufacture / produce something we require natural / man made resources, labor, and a few other things. Let’s learn more about the lesson.
Introduction
Palampur is an imaginary village with around 450 families. It is just three kilometers away from a bigger village known as Raiganj. The road that connects the village to Raiganj is well developed and extends to a bigger city called Shahpur. On this road, we can see various forms of transport including bullock carts carrying jaggery, motorcycles, jeeps, trucks, and tractors. Out of the 450 families in the village, around 80 of them are from an upper caste. Their houses are bigger and made out of brick and cement. They own a majority of the land in the village. 1/3rd of the population Is Dalits ( Scheduled Castes ). They own less to none land and most live in one corner of a village in mud and straw houses. Farming activities are activities that involve agriculture while non farming activities are anything but farming activities. A few examples of non – farming activities are production, transportation, dairy, etc.
Organization of Production
To Produce a good or a service, the 4 factors of production need to be met. The four factors of production are:
· Land – To set up a factory or an office at where the goods and / or services are going to be produced, land is required. Land is very important to produce something.
· Labor – Labor refers to those working to convert the raw material into the final product / the people providing the service to clients. These people actually do the work and are also necessary to produce something.
· Physical Capital – Physical Capital refers to the money, tools, machinery, materials, etc required to produce something. It can be classified into two types. Working Capital and fixed capital.
- Working Capital – Working capital is the capital that is being used constantly. For example, raw materials, money in hand, rent for factories, etc. It is capital that is continuously cycling across the chain.
- Fixed Capital – Fixed capital is things that are not required to be repeatedly renewed. For example, Machinery, tools, land, etc. These can be used without continuously spending more money.
· Human Capital – Human Capital is a new factor of production that has been added more recently. It involves the person who created or attained all the other factors of production. It involves the knowledge, skills, and enterprise required to set up such a complex production line.
All of these factors together make up the factors of production that are required to produce a good or a service.
Farming in Palampur
1. Land is Fixed – Around 75% of the working people in Palampur have jobs dependent on agricultural activities. Agriculture is the main form of production in Palampur. However, one issue is faced by the people of Palampur with land. Ever since 1960, though the population has significantly risen, the amount of land dedicated to cultivation has remained the same. To solve this, some wastelands had been converted into farms however now the amount of land is fixed. So, the ability to increase the production by increasing the cultivable land is no longer possible. 1 hectare is the standard unit of measurement of land. However, in rural areas you may hear people measuring land in other units like Bigha. 1 hectare is equivalent to a square of side 100 meters.
2. Is there a way one can grow more from the same amount of land – By looking at the facilities in Palampur and the crops grown it can be estimated that the village is based in the western part of Uttar Pradesh. All land in Palampur is cultivated. No piece of land is left idle. To maximize the amount of yield received from the land, farmers grow multiple crops a year. The practice of growing over one crop on the same piece of land in one year is known as multiple cropping. Most farmers grow bajra and jawar in the rainy season ( kharif ) and then grow potatoes during October to December. When it comes time of winter ( rabi ), farmers grow wheat. Once the wheat is harvested, the farmers store some for their family and sell the surplus in the markets of Raiganj. Sugarcane is grown in most fields all around the year as a cash crop. It is sold to rich merchants in Shahpur. The reason the farmers of Palampur are able to practice multiple cropping is due to their well developed irrigation system. Electricity came early to Palampur ( ~ 1960 ) when the government installed electric tube wells instead of Persian wheels in a few farms. Seeing their effectiveness is irrigating a large amount of land, in just a few years, farmers started adding their own tube wells from private vendors. Now, all 200 hectares of cultivable land in Palampur is irrigated via tube wells. It is unfortunate that in a developing country like India, under 40% of the cultivable land is being properly irrigated. Most other farmers depend on rain or other methods to irrigate their fields. We now know that mixed cropping is one method of increasing the amount of crop grown on a single piece of land. Another method is using HYV ( High Yield Variety ) of seeds. Yield is defined as the amount of crop produced by a fixed set of land. In the min 1960’s farmers across India used traditional seeds, irrigation methods, and used cow – dung and home – made pesticides to attain better yield. However, during the late 1960’s, the green revolution was introduced, promising significantly higher yields. Farmers in northern India were the first to pick up on it. To use these high yield variety of seeds, proper irrigation facilities, chemical fertilizers, and chemical pesticides were required to attain the best results. So, farmers got these HYV seeds, implemented better irrigation systems using tube wells, switched to chemical fertilizers and pesticides and most were able to attain significantly higher yield. In Palampur, upon using normal seeds, 1300kg of wheat would be harvested per hectare. After using HYV seeds, this number jumped drastically to 3200kgs. Farmers were able to sell more surplus and earn more money with these seeds.
3. Will the Land Sustain – Land being a natural resource, it is very important to keep it safe. During the green revolution, the utilization of chemical fertilizers and pesticides rose significantly. These degraded the quality of the soil significantly. The electric tube wells also constantly using water from the ground deplete ground water levels significantly as well. Scientific reports show that once depleted, natural resources like soil fertility and ground water are very hard to restore and take a lot of time. Chemical fertilizers, when exposed to water make the minerals readily available for the plant. However, these chemicals don’t stay in the soil for long. They move lower and lower, contaminating the ground water over time. This made the use of chemical fertilizer linked to loss of fertility in soil in some places of India. Punjab is the state that uses the most chemical fertilizers. It has come to a point where the farmers must use chemical fertilizers as the land quality has degraded to such a point that it wont be able to keep up with the requirements of the state. This is causing costs of cultivation to rise significantly.
4. How is the land distributed between the farmers of Palampur – We have, until this point, realized that land is very important for agriculture. Out of the 450 families in Palampur, 1/3rd of them don’t have land. That means around 150 families need to work for other people or find job in other non – farming activities. Most of these families are from scheduled castes. Out of the remaining 300 families left, 240 families have land less that 2 hectares making them small farmers and just barely get by. Gobind was a farmer in the 1960’s whop had 2.25 hectares on unirrigated land in which he used to farm with alongside his sons. After his death, the land was divided equally, and each son got 0.75 hectares. Even after using modern farming methods, they aren’t able to provide for their family using this land therefore requiring them to find jobs elsewhere. 60 Families have land larger than 2 hectares. These are medium to large farmers. Out of these, a few families have around 10 hectares of land.
5. Who Wil provide the labor - Now that we have talked about land, we must talk about the next most important thing, Labor. Small Farmers cultivate their fields alongside their own families making them and their families themselves the labor. Medium to Large Farmers hire farm laborers to work for them. Farm laborers often come from landless families or families cultivating small plots of land. Unlike farmers, these laborers have no right over the crop. They get paid in daily wages, cash, kind, or meals. The daily wage of an agricultural laborer has been set to 300 rupees by the Indian government in March 2019. However, farm laborers agree to work for cheaper due to the heavy competition in the region.
6. The Capital needed in Farming – We have seen that most modern farming methods require a lot of things that are expensive. So, to practice modern farming or to attain a good / high yield a farmer must spend a lot of money. Small farmers borrow this money from large farmers or the village money lenders. They are asked to repay this money at very high interest rates, and a lot of pressure is put upon them. Medium to large farmers use their own savings that the have collected from selling surplus over the past years as capital. Let’s talk more about selling surplus.
7. The Sale of Surplus farm products – The Sale of surplus s the sale of extra crop left after the families consumption crop is removed. For a small scale farmer like Gobind’s sons, The amount required for their families consumption is a majority of the total crop produced since less crop was cultivated due to the small land. For Medium and large scale farmers, this is not the issue, and they sell the surplus to traders in the market who later sell it to shop keepers. Most medium and large farmers save some of the money earned from selling surplus and spend the rest on giving out loans, buying / arranging the working capital, adding to the fixed capital, funding non farming production activities, etc.
Non Farming Activities in Palampur
Non – Farming activities are any activities that do not involve agriculture. In Palampur, less that 25% of the working population is involved in non – farming activities. Below are a few common non – farming activities in Palampur :-
· Dairy – A few people in Palampur own cows and buffaloes. They feed various kinds of grass, bajra, and jawar that was produced during the rainy season ( kharif ) to them and extract their milk. They then either convert this milk into a dairy product and / or just sell it to merchants / traders and Raiganj.
· Small Scale Production – Production is Palampur is done at a level much different that at which it is done in cities. It happens at a small scale where mainly only 1 laborer / the family is employed. There are less that 50 people producing goods in Palampur. For example, a man buts a sugar cane processing machine and buys sugarcane from farmers around him. He then processes the sugarcane into jaggery and sells it at a small profit.
· The Shopkeepers of Palampur – Very few people in Palampur involve themselves in trade. It is mainly the small shopkeepers that buy stuff for wholesale around the town and sell it. These are considered the traders of Palampur. Some of them who live near the bus stand have also converted a part of their house into a store.
· Transport – The transport sector of Palampur is developing quickly. You can see many vehicles on the road connecting Palampur to Raiganj and Shahpur. These people take goods or other people in their trucks / bullock carts from one place to another and in turn get paid for it.