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Demonetisation: Tea plantation workers to face a major crisis in Dec

Inadequate banking infrastructure is emerging as a major bottleneck

Avishek Rakshit & T E Narasimhan  |  Kolkata/Chennai 

tea, plantation, workers
Photo: Shutterstock

Labourers in plantations are heading towards a major crisis as payments are likely to get stuck or delayed due to the vacuum in liquidity generated after  which is yet to be filled.

In Assam, which produces more than 54 per cent of the annual produce, the arrangement was made to route the wages for workers through the district magistrate (DM), now the state government went ahead with the move to open bank accounts for each of the plantation workers, where their weekly or fortnightly wages can be credited directly to the plantation owners. However, so far has been slow.

Garden owners in the state said that about 50 per cent of the 800-odd estates in the state are located in remote areas and serviced by a five-employee strong bank branch of the garden. At the most, constrained by the available infrastructure, these gardens can open 50 accounts a day. While the government pushing to bring the state's entire worker workforce of five lakhs on the bank platform, these small branches are simply not able to handle opening so many accounts in a day. Even in south India's three states Kochi, Karnataka and TN, inadequate banking infrastructure is a major issue.

The state government has mandated the PSU operating in the gardens to set up ATMs in phases and bring the workforce under the bank's helm latest by December 5, which the estate owners, who are better placed to understand practicalities, feel too ambitious to achieve.

Out of the three major - SBI, UCO Bank and UBI - operational in the gardens, SBI has started installing ATMs in the gardens, nevertheless, the progress cannot meet the deadline set forth.

"Once the account is opened, getting it operational is another problem. Imagine the queue outside the single functional ATM in the estate on the day", Arun Thekedath, chairman of Planters Association told Business Standard.

According to the official, it will take time for the workers, who so long was paid in cash, to shift over to payments via the banks.

While the forthcoming due on December 3 can be cleared via the DM's office, where, the plantation owners deposit the in the DM's account and receive the equivalent to disburse to the workers as wages, the due on December 10, which needs to be routed via the are most likely to take a hit. In West Bengal, which produces the world's bestseller - Darjeeling Tea, the Reserve Bank of India (RBI), via a circular, has asked the gardens to modify the temporary arrangement of disbursing the wages via the DM's office and asked the gardens to disburse the directly. The country's apex bank has worked out a calculable limit for the gardens to draw from their current accounts to pay its workers fortnightly.

As per the circular, 2.5 X (garden area) X Rs. 1,400 is the maximum a garden can draw out money fortnightly.

"This method is not workable for most of the big gardens which are labour intensive. As a result of demonetisation, the availability of money with the is limited", S. S. Bagaria, chairman of Darjeeling Association told this newspaper.

While the situation may not be so intensive in the Darjeeling hills, whose gardens are less labour intensive, workers in the Terai and Dooars areas, whose average annual yield is 2,000 kg per hectare, are likely to be hit.

Storm in the cup
Storm in the cup

In the three southern states, many plantation owners have opted to partially pay the workers in while use the residual amount to help them buy rations and provisions from Kirana shops. This arrangement by plantations will help resolve liquidity issue as of now.

However, Kerala is now shifting over to using the model of routeing the through the District Collector to the gardens who in turn pays the wages and Karnataka are also considering rolling out the same model.

Citing the of Wages Act of 1936, which stipulates unless workers give a written authorisation to pay wages by cheque or through bank, wages should be distributed in and coins alone, an industry official told this business daily, "We are ready to give permissions and adjust one day for the benefit of workers and of course for the country, but if they go to also they are turned down as and ATMs don't have cash. How many times worker can go and come."

There are over 14,000 workers in seven plantations in the district, whose list has been taken by the district administration whom will have to be made.

Demonetisation: Tea plantation workers to face a major crisis in Dec

Inadequate banking infrastructure is emerging as a major bottleneck

Inadequate banking infrastructure is emerging as a major bottleneck Labourers in plantations are heading towards a major crisis as payments are likely to get stuck or delayed due to the vacuum in liquidity generated after  which is yet to be filled.

In Assam, which produces more than 54 per cent of the annual produce, the arrangement was made to route the wages for workers through the district magistrate (DM), now the state government went ahead with the move to open bank accounts for each of the plantation workers, where their weekly or fortnightly wages can be credited directly to the plantation owners. However, so far has been slow.

Garden owners in the state said that about 50 per cent of the 800-odd estates in the state are located in remote areas and serviced by a five-employee strong bank branch of the garden. At the most, constrained by the available infrastructure, these gardens can open 50 accounts a day. While the government pushing to bring the state's entire worker workforce of five lakhs on the bank platform, these small branches are simply not able to handle opening so many accounts in a day. Even in south India's three states Kochi, Karnataka and TN, inadequate banking infrastructure is a major issue.

The state government has mandated the PSU operating in the gardens to set up ATMs in phases and bring the workforce under the bank's helm latest by December 5, which the estate owners, who are better placed to understand practicalities, feel too ambitious to achieve.

Out of the three major - SBI, UCO Bank and UBI - operational in the gardens, SBI has started installing ATMs in the gardens, nevertheless, the progress cannot meet the deadline set forth.

"Once the account is opened, getting it operational is another problem. Imagine the queue outside the single functional ATM in the estate on the day", Arun Thekedath, chairman of Planters Association told Business Standard.

According to the official, it will take time for the workers, who so long was paid in cash, to shift over to payments via the banks.

While the forthcoming due on December 3 can be cleared via the DM's office, where, the plantation owners deposit the in the DM's account and receive the equivalent to disburse to the workers as wages, the due on December 10, which needs to be routed via the are most likely to take a hit. In West Bengal, which produces the world's bestseller - Darjeeling Tea, the Reserve Bank of India (RBI), via a circular, has asked the gardens to modify the temporary arrangement of disbursing the wages via the DM's office and asked the gardens to disburse the directly. The country's apex bank has worked out a calculable limit for the gardens to draw from their current accounts to pay its workers fortnightly.

As per the circular, 2.5 X (garden area) X Rs. 1,400 is the maximum a garden can draw out money fortnightly.

"This method is not workable for most of the big gardens which are labour intensive. As a result of demonetisation, the availability of money with the is limited", S. S. Bagaria, chairman of Darjeeling Association told this newspaper.

While the situation may not be so intensive in the Darjeeling hills, whose gardens are less labour intensive, workers in the Terai and Dooars areas, whose average annual yield is 2,000 kg per hectare, are likely to be hit.

Storm in the cup
Storm in the cup

In the three southern states, many plantation owners have opted to partially pay the workers in while use the residual amount to help them buy rations and provisions from Kirana shops. This arrangement by plantations will help resolve liquidity issue as of now.

However, Kerala is now shifting over to using the model of routeing the through the District Collector to the gardens who in turn pays the wages and Karnataka are also considering rolling out the same model.

Citing the of Wages Act of 1936, which stipulates unless workers give a written authorisation to pay wages by cheque or through bank, wages should be distributed in and coins alone, an industry official told this business daily, "We are ready to give permissions and adjust one day for the benefit of workers and of course for the country, but if they go to also they are turned down as and ATMs don't have cash. How many times worker can go and come."

There are over 14,000 workers in seven plantations in the district, whose list has been taken by the district administration whom will have to be made.

image
Business Standard
177 22

Demonetisation: Tea plantation workers to face a major crisis in Dec

Inadequate banking infrastructure is emerging as a major bottleneck

Labourers in plantations are heading towards a major crisis as payments are likely to get stuck or delayed due to the vacuum in liquidity generated after  which is yet to be filled.

In Assam, which produces more than 54 per cent of the annual produce, the arrangement was made to route the wages for workers through the district magistrate (DM), now the state government went ahead with the move to open bank accounts for each of the plantation workers, where their weekly or fortnightly wages can be credited directly to the plantation owners. However, so far has been slow.

Garden owners in the state said that about 50 per cent of the 800-odd estates in the state are located in remote areas and serviced by a five-employee strong bank branch of the garden. At the most, constrained by the available infrastructure, these gardens can open 50 accounts a day. While the government pushing to bring the state's entire worker workforce of five lakhs on the bank platform, these small branches are simply not able to handle opening so many accounts in a day. Even in south India's three states Kochi, Karnataka and TN, inadequate banking infrastructure is a major issue.

The state government has mandated the PSU operating in the gardens to set up ATMs in phases and bring the workforce under the bank's helm latest by December 5, which the estate owners, who are better placed to understand practicalities, feel too ambitious to achieve.

Out of the three major - SBI, UCO Bank and UBI - operational in the gardens, SBI has started installing ATMs in the gardens, nevertheless, the progress cannot meet the deadline set forth.

"Once the account is opened, getting it operational is another problem. Imagine the queue outside the single functional ATM in the estate on the day", Arun Thekedath, chairman of Planters Association told Business Standard.

According to the official, it will take time for the workers, who so long was paid in cash, to shift over to payments via the banks.

While the forthcoming due on December 3 can be cleared via the DM's office, where, the plantation owners deposit the in the DM's account and receive the equivalent to disburse to the workers as wages, the due on December 10, which needs to be routed via the are most likely to take a hit. In West Bengal, which produces the world's bestseller - Darjeeling Tea, the Reserve Bank of India (RBI), via a circular, has asked the gardens to modify the temporary arrangement of disbursing the wages via the DM's office and asked the gardens to disburse the directly. The country's apex bank has worked out a calculable limit for the gardens to draw from their current accounts to pay its workers fortnightly.

As per the circular, 2.5 X (garden area) X Rs. 1,400 is the maximum a garden can draw out money fortnightly.

"This method is not workable for most of the big gardens which are labour intensive. As a result of demonetisation, the availability of money with the is limited", S. S. Bagaria, chairman of Darjeeling Association told this newspaper.

While the situation may not be so intensive in the Darjeeling hills, whose gardens are less labour intensive, workers in the Terai and Dooars areas, whose average annual yield is 2,000 kg per hectare, are likely to be hit.

Storm in the cup
Storm in the cup

In the three southern states, many plantation owners have opted to partially pay the workers in while use the residual amount to help them buy rations and provisions from Kirana shops. This arrangement by plantations will help resolve liquidity issue as of now.

However, Kerala is now shifting over to using the model of routeing the through the District Collector to the gardens who in turn pays the wages and Karnataka are also considering rolling out the same model.

Citing the of Wages Act of 1936, which stipulates unless workers give a written authorisation to pay wages by cheque or through bank, wages should be distributed in and coins alone, an industry official told this business daily, "We are ready to give permissions and adjust one day for the benefit of workers and of course for the country, but if they go to also they are turned down as and ATMs don't have cash. How many times worker can go and come."

There are over 14,000 workers in seven plantations in the district, whose list has been taken by the district administration whom will have to be made.

image
Business Standard
177 22

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