India: Study shows higher procurement prices for cotton increase wages & decrease child labour

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6 June 2014

The Price of Less Child Labour and Higher Wages

Author: Davuluri Venkateswarlu, commissioned by India Committee of Netherlands

The present note is an attempt to examine the recent trends in wages paid to labourers and procurement prices paid to farmers by seed companies in Bt (Bacillus thuringiensis) cottonseed production in the Indian state of Andhra Pradesh and to understand the link between them…Cottonseed sector in India has received wide attention in recent years due to large-scale use of child labour in seed production activities…The general trend clearly indicates an upward movement in wages both for activities in cottonseed and other crops. Wages have increased significantly since 2004-05…One of the important factors which has contributed to an increase in farm wages is the implementation since 2006 of the National Rural Employment Guarantee Act…The interventions by the government, NGOs, UN agencies like UNICEF and some seed companies in recent years addressing the problem of child labour in cottonseed farms in Andhra Pradesh had a positive impact and reduced the availability of children for cottonseed work…the sharp increase in wages in 2010-11 and 2011-12, however, can be largely attributed to significant  increase in the procurement prices paid to farmers by the seed companies…Despite increase wages are still below the legal minimum wages…the available data do suggest that the rise in wages had a positive impact on child labour…[Also refers to: Monsanto, Mahyco]

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