Necessary hand-holding

When the Industrial Revolution changed the course of civilisation for the better, an undesirable side effect happened to be the decimation of village and cottage industries, not to mention the disastrous policies of the colonial regime in India that expedited the process. Today, cutthroat competition from the modern industrial sector, with advanced production techniques and digital markets, has pushed these cottage industries to the edge. Without State support, their survival would hang in the balance. These village-centric ancestral caste-based professions have a vital role to play in the rural economy, since they provide sustainable livelihoods for millions of people, largely of OBC castes, in the non-farm sector. Reviving these cottage industries is important, for it will help reduce rural poverty and ensure socioeconomic mobility for this class of citizens, in addition to the existing ‘affirmative action’ in their favour, which are essentially piecemeal.

During 2016-17, the Khadi and Village Industries sector as a whole generated employment opportunities for 13.64 million people, with production worth Rs 42,631.09 crore and sales amounting to Rs 52,138.21 crore. The top five Indian cottage industries are said to be cotton and silk weaving, carpet making, leather industry, metal handicrafts, and small food processing businesses. The annual report (2016-2017) of the Central Cottage Industries Corporation of India Ltd. states that the total foreign exchange earnings from cottage industries were Rs 3,201.35 crore from both exports and sales. However, in the absence of supportive studies, it is difficult to conclude that the above performance of the sector has necessarily uplifted the communities engaged in these occupations.

The 2021 National Statistical Office (NSO) report on migration in India reported that intra-state migration accounted for 87.5 per cent of total labour-related migration between 2020-2021, while inter-state migration was 11.8 per cent. The rural-to-urban migration, though mostly by the SC/ST farm labour, also includes a significant portion of people from OBC communities whose original family occupations included handlooms, pottery, blacksmithing, bamboo products, rope making, carpentry, oil pressing by ghanis, handicrafts in wood and ivory carving, and toy making.

It is important to revive the traditional cottage industries to prevent at least a part of the rural population from the miseries of migration and eventual estrangement from their original niche occupations. Besides, it is our national responsibility to preserve the world-famous skills of Indian artisans and craftsmen of cottage industries. According to Valza’s Global Export Data 2023, India tops the list of exporters of cottage industry goods in the world, followed by China and the United States, which underscores the immense possibilities for the growth of the sector. However, the challenge is the assimilation of cottage industries into today’s fast-growing digitised economy while ensuring fair returns for the artisans and providing avenues for skill upgradation. The issues with cottage industries mainly include a lack of technology, credit flow, marketing, and exploitation by middlemen. But the advantages are local sourcing of material and manpower, low energy consumption, sustainable production methods, meaningful employment, and a worldwide demand for unique handmade products. Besides, cottage industries play a vital role in women’s empowerment in rural India.

The ‘Cottage Industry’ has not been defined under the Khadi and Village Industries Commission Act, 1956. It is covered under the village industry vertical of the Khadi and Village Industries Commission (KVIC), classified into seven groups: Agro-Based & Food Processing Industry (ABFPI), Mineral-Based Industry (MBI), Wellness & Cosmetics Industry, Handmade Paper, Leather & Plastic Industry (HPLPI), Rural Engineering and New Technology Industry (RENTI), Service Industry, and Textiles Industry. The Prime Minister’s Employment Generation Programme (PMEGP) facilitates credit and subsidy, while a cluster-based scheme named the Scheme of Fund for Regeneration of Traditional Industries (SFURTI) provides improved equipment, common facilities centres, business development services, training, capacity building, and design and marketing support through exhibitions. Other schemes include Khadi Vikas Yojana (KVY), Gramodyog Vikas Yojana (GVY), and Coir Vikas Yojana (CVY). Additionally, the Ministry of Textiles has schemes like the National Handloom Development Programme and Raw Material Supply Scheme, which provide infrastructural and financial support. An exclusive focus on traditional cottage industries run by specific castes is conspicuous by its absence. Similarly, state support is largely demand-driven, with issues concerning outreach of the government agencies and access to the beneficiaries.

According to the MSME ministry’s data, for the whole of India, under PMEGP in 2022-23, Rs 2,722.39 crore margin money was released for 85,167 units set up, and an estimated 6,81,336 people were employed. Under the SFURTI scheme, since 2015-16 and until November 30, 2023, a total of 2,09,670 artisans were assisted with 358 functional centres. Under the Kumbhar Sashaktikaran Programme and Honey Mission of GVY from 2017-18 to 2022-23, a total of 1,03,760 potters and 18,631 beekeepers were benefited. Under Khadi Vikas Yojana in 2022-23, a total of 4,98,498 weavers were assisted in various ways, while under the Coir Development Scheme, 17,054 people received assistance. These absolute figures apparently are a pittance vis-à-vis the number of people working in cottage industries and the volume of business. They do not necessarily reflect the impact of the schemes on the lives of the artisans and craftsmen in terms of both inter- and intra-generational mobility, absent a detailed comparative study. A third-party evaluation of the performance of the existing schemes is necessary to address the gaps between the objectives and the implementation.

Village and cottage industries are different from MSMEs; firstly, because they are caste-based skill-driven occupations and secondly, because they are not scalable. A special approach is necessary to reinvigorate the cottage industries. To begin with, the focus needs to be on caste and its association with cottage industry. Alongside the caste census, we need an occupational census as well in order to identify the communities associated with cottage industries. More than the numbers, the principle is of paramount importance since it concerns preserving traditional skills and uplifting such OBC castes which solely depend on their skills for sustenance.

Cottage industries need to be integrated into modern business models focusing on global markets. For example, the handicrafts, gifts, and decoratives business worldwide is estimated at USD 235 billion, of which China accounts for USD 71 billion, whereas India is only at USD 3 billion. We need to develop an India-specific integrated approach to attract leading importers and international stores. For example, lac and toy manufacturing in Meerut, carpet weaving in Mirzapur and Benares, silk weaving in the villages of Murshidabad and Malda, metalwork in Boidrajpur (Bihar), Santipur, and Kharagpur, lungis and sarees of Melapalayam, and glass bangles of Fatehpur and Firozabad have global demand for their unique skills and craftsmanship. It is relevant to mention that, unlike India, many countries, including China, have wholesale trade marts for cottage sector exports. Finally, clubbing the cottage industries sector with tourism is essential, as it helps explore and develop new local and international markets and boost demand.

The writer is a former Addl. Chief Secretary of Chhattisgarh. Views expressed are personal