Greetings From ODAF !

Thank you for your continuous encouragement by sending your valuable inputs on Sandesh. This has really helped us in introspecting our defined commitments and purposes in terms of identifying, highlighting and addressing the issues at the grass root level that affect the people, primarily, Adivasi, Dalits and Fisher folk. We promise to reflect your experiences, initiatives, feelings and concerns through Sandesh for a wider reach. On the basis of our long experiences and your feedbacks, we may say that our efforts could be helpful in generating awareness and opinion favoring enforcement and protection of fundamental rights of the impoverished.

You will be aware that with the active initiation of Campaign for Survival & Dignity (CSD) on forest rights, the Prime Minister of India has approved for the introduction of a Bill on Recognizing Forest Rights of Adivasis on Forest Land in the Budget session of the Parliament. Keeping this in view, we at ODAF organized a workshop to discuss on the bill in the context of Orissa and recommend suggestion to be incorporated in the proposed bill. Eminent Social Scientists, Anthropologists, Academicians and Adivasis discussed on the bill and made valuable inputs and suggestions.

The concept of social accounting is gaining currency in recent times and this is viewed as a step towards measuring and reporting on an organizations social and ethical performance. Besides, as a part of information dissemination initiative, this issue of Sandesh highlights the proposed National Rural Employment Guarantee Scheme, Self Reliant village Value Added Tax, Fringe Benefit Tax, Global Week of Action etc.

Since Sandesh disseminates collated information from different sources it sincerely acknowledges the publisher and writer with thanks for allowing to share their work.

Your comments, suggestions and contributions are welcome and will be highly appreciated.

Editorial Team, Sandesh

Evolving Social Accounting Process

Dr.William Stanley
Introduction :

Social accounting as an approach began developing in the UK in the early 1970s, when the Public Interest Research Group established Social Audit Ltd. In more recent years the practice of social accounting and audit has begun to expand significantly in the community sector. However, it is not possible to record all the social accounting. The experience becomes richer and more diverse all the time and a challenge for those involved is to ensure that lessons learned can be lessons shared and to develop common standards that are relevant and appropriate.

Social accounting is defined as a systematic analysis of the effects of an organization on its communities of interest, with communities input as part of the data that are analyzed for the accounting statement. Social accounting broadens the domain that accountants normally consider and, in particular, considers the social impact of an organization on its community.

Social accounting is not another system to be imposed on an organisation it is more an approach, providing a framework which permits the organisation to report on its social performance in the fullest and most effective way possible. Social accounts make use of information which an organisation already gathers, reports which already have to be prepared, and consultations which are already carried out.

Social accounting is a framework which allows an organization to build on existing documentation and reporting and develop a process whereby it can account for its social performance, report on that performance and draw up an action plan to improve on that performance, and through which it can understand its impact on the community and be accountable to its communities.

How do NGOs add value to communities? How can they create social capital out of the money invested in them? Can NGOs and collectives or networks measure their social performance and make their case? How can NGOs justify the public's trust in them? How can NGOs measure their outputs ?

The core agenda of NGOs is to achieve some form of social, community or environmental development. The organization and all the people associated with it or affected by it need to know if it is achieving its objectives, if it is living up to its values and if those objectives and values are relevant and appropriate. That is what the social accounting process aims to facilitate.

All organisations keep records about what they do, about staff and volunteers, about their members, about their partners about training organised, about their members etc. All organisations have records of meetings and produce various reports. This is valuable raw material which can be used in the social accounts. Usually there is much more "in the bag" than you realise, sometimes tucked away in different departments or different computers and not brought together or only used for one purpose when it could be usefully used to inform others as a part of the social accounting process. Social accounting is a way of measuring and reporting on an organisation's social and ethical performance.

Keeping social accounts gives us the information we need ‘qualitative and quantitative’ to tell us how we are performing and what people think about what we do, and how we do it. Social accounting provides an ideal way to combine participatory methods of indicator setting with ongoing qualitative data collection. Developing social accounting processes within an organisation involves commitment to on-going community dialogue, and the development of a management information system based on indicators of social impact. Impact assessments of enterprise development projects often bemoan the lack of a systematic embedded monitoring and evaluation system, which hampers efforts to provide and use meaningful impact assessment information to prove our achievements, towards a desire to improve them, using learning gained from the exercise as a key direction.

Fundamental to social accounting is the concept of accountability, aided through increased transparency. Social accounting adds a level of accountability to what are sometimes perceived as unaccountable NGOs. There are those who now suggest that social accounting offers an interesting way of bringing wider accountability to donor funded or NGO-led projects. One of the most positive features of social accounting is that it encourages change within the organisation and lead to ownership and ongoing improvement in the organisation.

Exploring Social Accounting

Social accounting is perceived by different organisations and this perspective has lead many resource agencies and consultants (NGOs, CSOs, Corporates, Consultants, UN and WB) to define social accounting. In many cases the communities as well as implementing agencies have not yet captured the impact of the work in socio and cultural terms. However, they try to quantify in economic terms. Therefore the debate is whether social accounting should be seen beyond financial quantification of the impact? Are should social accounting to be legitimised with the tools that was developed by experts and consultants?

Let us capture how the NGOs, sometime along with the communities try to develop an impact analysis of the investment they have done either in the field of social capital or direct finance as a capital. I would like to share a few examples which had emerged during our experiences while working with the people.

Case – 1: Volunteers or Paid staff and their role: Usually it is expected that the volunteers or the staff are trained, capacitated and oriented, keeping in perspective the concept of empowerment, different educational process (social, cultural, political, development and environment) to achieve basic awareness, sensitisation of the root causes of poverty, injustice and underdevelopment. This act of education therefore expects the poor and the communities (landless, bonded labourers, marginal and small farmers, artisans, ethnic based formation and gender) to get unionised or organised to claim their rights. Then what happens? it is the processes of empowerment moving from one level to another level of critical consciousness and joint action to initiate, achieve, reject or sustain certain basic core values of unity, justice, respect, dignity, equality, love and peace. By organised actions the groups may achieve their ultimate goal step by step and in the process reinforce, strengthen and build confidence that they can bring change in their life from worst to better and better to good situations and qualities of life with in the given or agreed upon value framework of social justice (encompassing all). Therefore, aspiration, motivation, commitment and dedication are other parts of impact of the work carried out and very often neglected in the social accounting tools.

What actually happens?

The NGO prepares a plan for three to five years for which funding is assured and they implement the programme in planned and systematic manner. This can happen with out the people’s or community in partnership not participating, in some case they may begin enlisting participation in the implementation process and engaging communities from the very beginning of vision, mission, objective, role, strategy and programme building. These all depends on the vision and core values of the leader, the team and the whole organisation.

To implement the programmes, the NGO appoints the needed, well equipped, trained or freshers, or selected volunteers to work among the people. The NGO or the community together want to achieve something which is visible, some times felt and very often non-visible areas as mentioned earlier. Take the following example:

Say, One staff is appointed to work among 100 families who are identified as poor in economic terms, unorganised, having different attitudes influenced by local situation (social (castes), cultural (gender), religious (faith), ethnic (animist or totemic), economic (class) and environment (degraded). The attitude may be pessimistic, fatalistic, and no hope situation and behave individually to the root causes. This is the context the staff is placed. The staff have to take a position before she or he intervenes in an educational process of changing the mind sets and there by also learning from the communities. Sharing of knowledge and skills are involved. In the process the organisations (implementing to funding to donors) at all levels become the beneficiaries of such a educational process. How then we can qualify and quantify these process, lessons learnt, values built, rebuilt and reinforced?

Quantifying the impact in financial terms :

Out of the 100 families imagine this is the situation (In many villages we work or enter new, more or less will be same context)


10 Families are bonded to 3 or 4 landlords. Each of the bonded labourers are paid Rs. 500 to 2000/ depending on the capacity and the need of the loan the amount varies. Any how take one Bonded labourer case who is bonded for a year for 1200/-. This bonded labourer works the whole year say 300 days out 365. He works day and night. He is paid per day only 4/- as against the legitimate wages of Rs.50/ per day. Every day the landlord robs Rs. 46/ from the bonded labour. Imagine the situation of hundreds of bonded labourers contribution in the creation wealth to the landlords. In other words the bonded labour should have been paid Rs. 15000/ but in real terms he gets Rs. 1200/- only. There are so many other implications in this example. One of implication is the landlord is now ready with the contribution of the bonded labour to keep many more bonded labourers, or he acquires or attaches other marginal farmers land in the form mortgage or share cropping, lend money for high rate of interest and so on. The landlord becomes more powerful, enters into politics, his children can get good education, gives charity to religious acts, become popular, have nexus with police, staff of the government, politicians and business communities. At the poor people level, the communities live in constant fear, threat, trauma and no body dares to question or there is no space for even understanding why they are bonded and the whole process of capital building. They live as illiterates, their children can’t go to school, at times of sickness they do not have money, culturally they are forced to spend money to chase the evil and so on so forth. What happens now by the staff, what does she or he do?

They organise meetings with the community, in some case separate meetings are organised among the bonded labourers. The educational process goes on till a stage emerges of getting united at the level of poor people or as bonded labourers. They are now sensitised, educated and organised and looking for actions. The education process may also involve dialogue and sensitisation of the rich. Some times ends in conflict and violence, there after police, court cases continue. In some instances the bonded labourers do not report to work. In other cases the bonded labourers with or with out the community call the landlords for the meeting and explain how the landlords are exploiting them, and how they now owe money to the bonded labourers and share the whole analysis of wage systems, number of days they worked, and how much they should have been paid and so on. Moreover they may also discuss how they were fearing before, live in continuous intimidation, abuse and psychologically wounded and now they have become fearless, united and want to live in dignity and respect. Obviously the landlord is not going to pay the money back, cases can be booked for various violations and illegally holding them to bondage. By not going to work they have to search for an alternative livelihood, they may migrate in search livelihood, work as labourers, clear forests and become farmers, all these can happen as individuals or as collective. The economic impact is that they are not going to anymore contribute to the land-lords capital growth. The landlords get in to loss or bring others from outside as bonded labourers for a little higher or increased money. The case I am sharing is really happened just in one block, the educational work by the staff with the bonded labourers went on for years ( 3 to 7 years) and nearly more than 1200 bonded labourers were released. Imagine the kind of flow of money through labour to landlords getting stopped? Imagine the quantum of money saved by the labourers not becoming bonded, see the people living in dignity and free from bondage. Very importantly how they will not reverse to the earlier situation, and what kind of education continues that need to be sustained? What would have happened to the staff and the organisations, their life threat, allegations, police interference, false cases and no government support and politicians wanting to stop the functioning of the organisation? Many more things are there to share, but I will leave it to all of you for your wild imagination. Now the question comes how to go about social accounting in this case. The organisation might have spent as salaries, travel and training to staff which can be financially quantified but what is the impact through the educational process that was achieved, how will you quantify and qualify ? Who will be engaged in the social accounting process?

Few other cases you can easily analyse with the reference given in the bonded labour case:

  • Landless labourers – Low wages, equal wages to women and men
  • Marginal farmers – release of their mortgage of lands
  • Just or fair price for the products they sell
  • Reduced money lending
  • Reduce in the interest rates
  • Collective decision making
  • Women status in the family, community and the society
  • Unity among the poor
  • Good leadership and good governance
  • Property rights to the landless, poor and the women
  • Savings in kind and cash
  • Restoring lost communitarian values
  • Advocacy and Lobbying: Campaign against commercial plantation, land alienation, land acquisition, Amendment to V schedule, eviction notification to encroachers of forest land and mining and displacement and Adivasi Policy – These campaigns have many positive changes in the policy. In some case programmes were withdrawn and even the MNC’s were forced to withdraw their engagement. Imagine the financial loss, credibility, of these Trans national corporations. At the community level they are not displaced, their culture and values are preserved and their ownership to livelihood resources are protected, they continue to live in dignity which cannot be quantified in terms of money.
  • Role of elected Panchayat Leaders and the community has a whole were engaged in enlisting many government programmes from loans to formation of SHGs managed by the communities or women groups, plantation, road, school, drinking water, housing, building ponds, check dams and water shed activities and many more. In financial terms when you quantify it will be more than the investment of the NGOs in empowering the communities.
  • The role of Staff and the volunteers are always under valued and we have not yet developed the amount free labour they provide to the process of development.
  • Community health activities such as preventive, promotive and curative have reduced the burden of the poor from succumbing to sickness therefore having the increased capacities in the production activities.
  • The livelihood activities support to land development, forest regeneration, skills development, value added technologies, water resource development have increased the income of the families as well brought back sustainability of the ecology, environment, bio-diversity and economy.
  • We are still attempting together with communities to do at least in one village a balance sheet. The people in the villages may be economically poor but they have rich values, qualities and resources. They have plenty of common property resources but these resources are under the control of the State for exploitation. It is a paradox and a pain how the people are termed to be poor while they have rich resources and address their poverty by providing meagre development assistance. Very often we never calculate how much of the poor peoples resources flows out from centre to periphery. Nothing comes back to the people even if it did but in small peace meal proportions. Only if we can do a balance sheet like any other corporates, banks, Governments or for that matter even NGOs and funding agencies the knowledge systems, the governance, social, cultural, economic, environmental and biodiversity resources the poor will become rich not to exploit or destroy but to have a new image of the people which will give them confidence, pride, honour, self respect and dignity which is part the social accounting process.

There are so many other activities where we need to develop criteria and indicators to rationalise social accounting process.

At ODAF level, over a period of 16 years we have developed certain areas to quantify people’s contribution. The tools and methods are continuously getting evolved. However, we would like to share with you the following ideas on social accounting:

  • NGOs have balance sheet and accordingly investment is made for further development. But, there is no balance sheet of assets and liabilities at the village level.
  • Need to understand the level of assets and liabilities at the village before and after the intervention.
  • The balance sheet is of particular importance because they can determine the value on paper of their holdings, but it does not tell the complete story of its value, especially as it concerns its impact on the community and intangible items such as intellectual capital.
  • The concept on Eco Debt can be stretched to the social accountability,
  • Beyond quantifying, it implies how it has sustained the relationship between nature and community in social terms.
  • Social accounting should quantify in value terms not in money terms.
  • Accounting word should not be used in this case and it should be perceived as an educative process itself
  • In many cases quantification is not possible mostly as it is subjective.
  • Definition on social accounting can be worked out as an initiative.

In the corporate world, genuine social accounting has been one of the first major stepping stones in improvements in corporate social responsibility. For many corporates that embark on the process, it is the first time that serious attempts have been made to go beyond financial measurements and understand the social and often environmental impact that the organisation has on its stakeholders. Thus such exercises are viewed as a good step forward towards social impact assessment.

Many of them have struggled since their inception to collect information amounting to a social impact assessment in order to legitimise their existence - to donors, if not themselves. Hard work of developing good quality monitoring and evaluation systems remains crucial and the need for periodic impact assessment studies will remain to be explored.

The conclusion drawn is that social accounting is not a means of, nor an alternative to, impact assessment, but rather a framework methodology into which impact assessment can fit, focus on organisational learning, the embedding of organisational information systems and the systematic improvement of dialogue with the communities in evolving practices of social accounting.

Resources Referred:
  • Social Accounting: A Method for Assessing the Impact of Enterprise Development Activities? Chris Pay, Tradecraft Exchange
  • The SEAAR Process adopted by ECOTA Fair Trade Forum in Bangladesh, Tareque A. Khan, ECOTA
  • Merseyside Open College Network (MOCN) course Social Accounting and Audit for Community Organisations.
  • The Case for Social Accounting for Non Profits, Laurie Mook,
  • What Counts: Social Accounting for Nonprofits and Cooperatives (Prentice Hall, 2003)
  • Experiences from the work

( The author is the Executive Secretary of Orissa Development Action Forum (ODAF) and Director of IRDWSI , a NGO based in Koraput. He has been actively involved in the social activities in different parts of India for last 25 years. )

Fringe Benefit Tax

The Finance Minister, Mr. P. Chidambaram has already presented the Budget for the year 2005-06. The Budget carries a proposal about Fringe Benefit Tax (FBT). This tax is aimed at taxing the following expenses incurred or payment made by the employer for or to the employees:

“Entertainment, festival celebration, gifts, use of club, employee welfare, conference, conveyance, tour and travel including foreign travel expenses, hotel boarding and lodging, repair and maintenance of motor cars, use of telephone, consumption of fuel other than industrial fuel etc.”

The employer has to pay a flat 30 percent tax on defined base for the Fringe benefit. The proposal if implemented will cause huge difficulty to NGOs in the payment of tax and in meeting the compliance requirements.

The defined tax rate on the different kinds of services and privileges are mentioned below.


Nature of Fringe Benefit Taxable Value of Fringe Benefit Tax Rate (on the Gross  Expenditure)

Any privilege, service, facility or amenity directly or indirectly provided to the employees.

100% 30%
2 Any reimbursement directly or indirectly to the

Employee for any purpose.
100% 30%
3 Any free or confessional tickets for private

journey of employees and families.
100% 30%
4 Contribution to superannuation fund. 50% 30%
5 Expenditure on entertainment 50% 15%
6 Expenditure on festival calibrations 50% 15%
7 Gifts 50% 15%
8 Expenditure on use of club facilities 50% 15%
9 Provision of hospitality of every kind to any person 50% 15%
10 Maintenance of Guest House 50% 15%
11 Conference 50% 15%
12 Employee welfare 50% 15%
13 Use of health club, sports and similar facilities 50% 15%
14 Sales promotion including publicity 50% 15%
15 Conveyance, tour, travel (including foreign travel) 20% 6%
16 Hotel, Boarding, Lodging 20% 6%
17 Repair, running, maintenance of motor cars

including depreciation
20% 6%
18 Consumption of fuel other than industrial fuel 20% 6%
19 Telephone 10% 3%
20 Scholarship to children of employees 100% 30%

Source: FMSF, New Delhi and write up of Mr.Felix Madiath, Consultant ,ODAF

Value-Added Tax (VAT): An epoch making step
Santosh Kumar Patnaik

A new tax regime, Value Added Tax (VAT) has been introduced in 20 states of India from April 1st this year. In the year 1976, the Govt of India had constituted an “Indirect Tax Inquiry Committee” under the chairmanship of well-known economist Mr. L.K Jha to recommend certain reforms in indirect tax system. This committee for the first time advised the government to introduce value added tax. But it was found out then that if all the states would not show interest for introduction of this tax, there would not be any significant gain, so it was only introduced at the manufacturing level, which was called as MANVAT. The Reform Committee suggested to bring in Modified Value Added Tax (MODVAT). It is to be noted here that in the year 1999 the then Union Finance Minister constituted a high level committee of finance ministers of all the states under the chairmanship of Dr.Asim Das Gupta, Finance Minister of West Bengal with the purpose of analyzing the effectiveness of value added tax in India. The committee published a white paper on value added tax highlighting different aspects of this tax.

First it was in France where the Value Added Tax was introduced in the year 1954 and then it was in Brazil during the 60’s. Afterwards many countries in Europe and Asia adopted this tax regime. Till now roughly 70 percent of population in 130 countries of the world are covered under Value Added Tax. When VAT was introduced in most of the countries of the world the revenue of the concerned countries started increasing considerably while economy of each country became stronger with the removal of trade barriers by the European Common Market. The trade of those countries became more competitive that resulted in creating more employment opportunities. Those who are out of European Common Market they are now much thinking in terms of going it as members to get the business opportunities opening up.

Under this present tax regime a commodity is burdened with different taxes at different stages. Even at times tax is enforced on tax resulting in unreasonable rise in the price of commodities and discontentment among consumers and traders as well. But if VAT is adopted the trader would get back the tax amount he has deposited on account of any given commodity.The prices of such commodities would get reduced much for the benefit of consumers. We can understand the process through an example. Let us assume a commodity reaches the consumer through three stages and defined sales tax rate is 10 per cent. Suppose“A” sold raw material to “B” for manufacturing a commodity at a price of Rs.100/-. Thus “B” paid Rs.110/- to “A” (cost of raw material plus the sales tax) and got the raw material. Then “B” processed the raw material through different techniques and added value say Rs. 50/- to the raw material he purchased from “A”. Thus the finished product is now priced at Rs.160/-. “B” sold this commodity to “C” at a price of Rs. 176/-/( Rs. 160+10% Tax= Rs.160/+Rs.16/= Rs.176/-). It is to be observed that “B” Purchased raw material from “A” paying 10% tax. Again “C” paid tax on the tax paid earlier thereby causing an unnecessary rise in the price level. But if VAT is adopted,tax will be levied on the value only. In this case “C” has to pay only Rs.5/- as tax on the value of Rs.50/- and can purchase the commodities at a price of Rs.165/- and get back Rs.11/-(Rs.176/--Rs.165=Rs.11). VAT is based on simplification of tax regime in the states and central tax reform. As such VAT is an essential part of the economic reform. If VAT is adopted and implemented by all the states sales tax inconsistencies will be removed and a simple transparent and voluntary tax regime can be created resulting in an increase in revenue collection, exports and employment opportunities in the country. Besides prices of the commodities in the market will be comparatively less and the economy of the country will get a boost to march on the way of progress.

On the other hand, VAT encourages the taxpayer to deposit the tax on his own. It lays emphasis on transparency and helps in checking bureaucratic hurdles. In the VAT regime the registered trader will get back the tax deposits he has made earlier after submitting his sales account, receipts etc. So not much paper work is needed here except keeping meticulously sales and purchase register, account book and receipt book.

The committee constituted under the chairmanship of West Bengal Finance Minister Dr.Asim Das Gupta suggested four different tax rates on 550 commodities, those are :

  • 46 no of natural and unprocessed products like betel leaves, books, periodicals and journals fresh milk, fishnet fabrics, fire wood, fresh vegetables, meat, fish those come mainly from the un organized etc. sector will be exempted from tax whatsoever.
  • 1 percent tax on gold ornaments, silver articles, and bullion.
  • 4 percent value added tax on raw materials used in production of 270 essential commodities like bread, drug and, medicines, flour, also implements of the agriculture. Also the ready-made garments.
  • Minimum 10 percent and maximum 12.5 percent tax agreed upon on 217 commodities

20 percent VAT will be levied on de merit goods like cigarette and alcohol. Petrol and diesel would be kept out of VAT regime, which covers only marketable items Exports are completely exempted from VAT, in keeping with the current perception of boosting exports at any cost. Interestingly, studies of the VAT in Europe (Sweden, Italy, Germany and the United Kingdom) show that VAT has not had any significantly impact on exports.

It is important to note here that all traders with an annual turnover of Rs. 5 lakhs or below have been exempted from the VAT regime and those traders having an annual turnover of over rupees five lakhs and below 40 lakhs of rupees will deposit at least 1 percent tax as per their turn over. The union government has announced to compensate the loss made by the state governments on this account In the first year it will compensate 100 percent in the second year 75 percent and third year 50 percent in the . The union government has also assured that the central sales tax will be abolished within four years of the introduction of VAT. And with the abolition of the central excise duty the real benefit will accrue from the introduction of VAT shortly.

As a result of introduction of VAT, our country can save about 1600- 1700/- crore of rupees which amount to 0.5 to 1 percent of Gross Domestic Product. Under VAT regime each trader will be allotted a 10 digit Tax Payers Identification Number that will help in inter state data transfer. The voluntary tax payment system under VAT regime will be verified through departmental audit. Each year some traders will be selected through different methods for the purpose.

With the VAT regime now in force, the tax burden and the price of different commodities will lessen gradually, the highhandedness of the bureaucrats will itself die down and inter state competition in tax structure will be a thing of past while the development of economy will be made easier. Some traders argue that VAT is an incomplete tax regime and the VAT introduced in India is different from the same in other countries. They are of the opinion that Central Sales Taxes along with state commercial taxes add to the unreasonable price rise. But this argument seems to be unfounded. According to a study made by the International Monetary Fund (IMF), it takes a time of 18 to 24 months for full implementation of VAT regime and during this period slight rise in prices is expected and increase in revenue collection is also hampered in small measure. But in the state of Haryana VAT was in implemented some years back and from its results now we can conclude that VAT will undoubtedly help in strengthening the economy of our country.

(This article of Mr.Santosh Kumar Patnaik was published in the Oriya Daily Dhairitri on 3rd April,05. Mr Patnaik is working with Orissa Development Action Forum.)

National Rural Employment Guarantee Bill-2004: Issues and Concerns

Siba Sankar Mohanty

With the emergence of the neo-liberal regime, the Indian economy witnessed shrinking of employment opportunities both in urban and rural areas. Throughout the 1990s, India witnessed growing unemployment even though the economy experienced an annual average growth of GDP by around 6 per cent. The Economic Survey has estimated an increase in unemployment rate from 5.99 per cent during 1993-94 to around 7.32 per cent during 1999-2000. The estimates based on the 55th Round of NSS shows an all India unemployment rate of around 12 per cent among the rural households.

The fact that the size of the labour force is around one third of the total population in India, growing unemployment signifies growing impoverishment of the population. Table-1 shows clearly that during 1980s and early 1990s there had been drastic reduction in unemployment in the rural sectors. The neglect of rural India in the later part of the 1990s resulted in a reversal of the trend and accounted for massive unemployment to the tune of around two crore in absolute numbers. Chart-1 depicts that though urban unemployment rate has remained consistently high during 1990s, the rural unemployment rate as well as the All India rate have increased substantially during the last decade.

A sectoral analysis of employment in India (Table-2) shows that the absolute number of people employed in the agriculture sector has remained the same and the contribution of the sector in total employment has gone down from 60.4 % in 1993-94 to 56.7 % in 1999-00. While there has been an increase in the labour force by around27.3 million (from 335.9 million to 363.3 million) and in the rural economy by 15.01 million (from 255.38 to 270.39) during the same period, the agricultural sector could absorb only around 0.2 million of those.

Table- 1

Growing Unemployment in the 1990s

All India




Labour Force as % of Population




No of Persons Employed in All Sectors ( in million) un employment rate in %




Unemployment Rate in %




Number of unemployed ( in million)








Labour force as a Proportion of Population




No of persons employed in All Sectors   (In million)




Unemployed Rate in %




Number of unemployed ( in Million)








Labour force as a proportion of  Population




No of Persons Employed in All sectors    (in million)




Unemployment Rate in %




Number of Unemployed (in Million)





 Sectoral Analysis of Employment (in Million)

Employment                         1983              1993-94         1999-2000

in Different Sectors

Agriculture                        151.35          190.72          190.94

(63.2)           (60.4)           (56.7)

Industry                           37.43            49.99            59.15

(15.6)           (15.8)           (17.6)

Services                           50.78            75.11            86.65

(21.2)           (23.8)           (25.7)

 # Figures in the Bracket indicate the proportion of the total work force Source: Economic Survey

Many economists argue that the reason behind such a deterioration in the employment scenario in India has been the sluggish growth in agriculture as well as substantial reduction in rural developmental expenditure of the union government. It is noteworthy that expenditure towards rural development as a proportion of GDP has gone down from an average of 13 per cent during the Eighth Five Year plan to only 5 percent unemployment in the Tenth Plan. In the post 1993 era, in all the States in India, the rate of growth in employment has been much lower than the rate of growth of GDP, signifying a seriously deteriorating demand situation in the overall economy.

The Context of an Employment Guarantee: All these set the context in which the crisis in employment emerged as a major concern among the masses and it got reflected in the popular mandate of the Lok Sabha Elections 2004 in rejecting the anti people policies of the previous NDA medley. After assuming power, the newly elected UPA Government announced its first ever popular announcement in the form of a set of promises called the National Common Minimum Programme (NCMP), which immediately became very popular. The first promise of the NCMP states that –“The UPA Government will immediately enact a National Employment Guarantee Act. This will provide a legal Guarantee for at least 100 days of employment, to begin with, on asset creating public works programme every year at minimum wages for at least one able bodied person in every rural, urban poor and lower middle class household. In the interim a massive food for work programme will be started.” 

Surprisingly, the first ever activity of the UPA Government has been the endorsement of the Fiscal Responsibility and Budget Management Act which has potential to limit the role of state even in crucial social sectors. In the guise of the Act, the government can actually cut down expenditure on social and economic sectors and at the same time give the logic of deficit control for its activities. However, with growing pressure from the common public, the coalition partners especially the Left parties and from the Civil Society Organisations including the Right to Food Campaign, the Government finally came out with a draft Bill called the National Rural Employment Guarantee Bill 2004 (henceforth NREGB-2004) on16th December 2004. However, NREGB-2004 in its present form not only undermines the government’s commitment towards providing 100days of employment to all rural, urban poor and lower middleclass households, but fundamentally disregards all logical and ethical principles of an employment guarantee.


The Financial Provision: The financial memorandum of the NREGB-2004 estimates the total financial requirement of the scheme to be around Rs. 38, 600 crore. The State wise results of BPL census calculated the number of BPL households to be around 5.4 crore in India as on 17 March 2001. A comparison of the number of BPL households is given in Table-3. Given that the wage to material ratio in the programme will be 60:40 and the estimated expenditure per diem per person will be Rs. 100, the total amount required for an employment guarantee to all rural poor households will be to the tune of Rs. 53847.4crore per annum. With the provision of Rs. 38600 crores, employment can be provided to around 3.86 crore families. This means that around 1.5 crore families will remain untouched from the employment guarantee. These families will be liable for unemployment allowance.

A Guarantee??: NREGB 2004 states that the “Act shall come into force on such date ….and areas” as may be notified by the Central Government. This raises the apprehension that the Central Government can ‘switch off’ the employment guarantee at any time. Again, there is no provision for the time bound extension of the so-called guarantee to the whole of rural India.


State-wise Results of BPL Census for Ninth

 Plan in India (As on 17.03.2001) 


Total No.        of Rural Families

No. of Rural Families Below poverty Line

% age of Below Poverty Line

Andhra Pradesh




Arunachal Pradesh
























Himachal Pradesh




Jammu & Kashmir









Not reported

Not reported -


Madhya Pradesh





































Not reported

Not reported -


Tamil Nadu    








Uttar Pradesh




West Bengal




Admn & Nic Islands

Not reported

6421 -


Dadra & Nagar Haveli




Daman & Diu
















                                            Source : Lok Sabha Unstarred Question No. 2688,dated 8.8.2001

Defining a Household: The NREGB-2004 defines a household as a social entity where, the members are related to each other by blood relation, marriage or adoption, normally staying together, sharing meals or a common ration card. Such a definition is very vague and unscientific in the context of selecting beneficiaries in any poverty alleviation scheme. This would further restrict the scope of the guarantee. Again the average size of rural households varies across different States, from around 4.5 persons per household in States like Tamilnadu, Andhra Pradesh and chandigarh to around 6-6.5 in states like Bihar, Rajasthan, Jammu& Kashmir and Uttar Pradesh. The enactment of NREGB-2004 in its present form will certainly discriminate against the states having a higher family size unless the definition of the term household is restricted to that of a nuclear family.

Finding a Poor Volunteer Worker: The NREGB 2004 restricts the scope of the employment guarantee to “poor households” –i.e., those below the poverty line in a particular year. In India, the identification of the poor is not satisfactory. Many argue that even on the basis of per capita calorie intake equivalent income, the actual number of poor households is much higher than the official estimates of BPL households. Again, identifying the eligible households who come under BPL, will necessarily add to the administrative burden and nepotism. In this regard, the criteria of self selection should be adopted along the lines of the NCMP.

Minimum wages: NREGB-2004 states that the Central Government would specify the wage rate notwithstanding anything contained in the Minimum Wages Act, 1948. The penalty for a eligible person who does not offer his/her labour for such arbitrary wage rate fixed by the central government is forfeiting his/her claim for the unemployment allowance for three months. This is something, which raises doubt on the intentions of the government.

Role of PRIs: The earlier draft prepared by the National Advisory Council (NAC) gave a critical and justified role to the Panchayati Raj Institutions in planning and monitoring of the Employment Guarantee Programme. In the present Bill, the role of PRIs has been reduced substantially. The local planning and monitoring authorities namely the Block-level Programme Officer and the District Coordinator, as envisaged by the NREGB-2004, are not accountable to the elected PRI bodies. Such centralisation of planning process in the hands of bureaucracy bypassing the elected bodies will erode the effectiveness of the employment guarantee programme.

Financial Burden on the State Governments: In NREGB 2004, the State Governments are supposed  to bear 25 per cent of the material cost, the unemployment allowances and the overhead cost of the employment guarantee programme.  Chart- 2 shows that the outstanding liabilities of the state governments as a proportion of GDP are increasing over the last fifteen years. Any further contribution towards the implementation of the scheme will further burden the exchequer of the State Governments. On ethical grounds also, the employment guarantee was a promise of the Central Government made in the NCMP –there is no reason to justify the compulsory contribution of the State Governments towards the implementation of the scheme.


States’ Outstanding Liabilities as % to GDP at

Current Market Prices  

Source: Drawn on the basis of information provided in the State Finances: A Study of Budgets (2004-05), RBI.

When we discuss the financial condition of the State Governments, we should also examine the role of the Central Government in worsening the fiscal situation in the States. Chart-3 shows clearly the decline in the net transfers from the Central government as a proportion of the total expenditure of the state governments. With such precarious condition of the States, the Centre has no legitimate ground to ask the State Governments for substantially contributing towards the programme promised by the Union Government itself. Resource poor states like Bihar and Orissa will not be able to comply the matching contribution for the programme and will not be able to ensure effective implementation of the scheme.

The bigger question is of course about the unemployment allowance. The Bill not only places the burden of unemployment allowance on the state governments, but also links the payment of unemployment allowances to the economic capacity of the State Governments. Given the fiscal clutter the state governments are in, such a clause will eventually result in non payment of the unemployment allowances. Unless the Central


Net Transfer from the Centre as a Proportion of Total Expenditure of the State Governments 

 Source: Drawn on the basis of information provided in the State Finances: A Study of Budgets (2004-05), RBI.

Government pays the unemployment allowances as well the employment guarantee will be meaningless. We have already discussed that around 1.5 crore rural BPL families will not be covered under the programme. These families will be eligible for unemployment allowance, which will be paid by the State governments. This will cost the state governments around Rs 686 crores in the first 30 days and Rs. 3202 crores in the last 70 days, over and above Rs. 3900 crore State contribution towards the scheme. In total, the extra burden on the State governments will be around Rs. 7788 crore in a year not including the overhead and administrative cost.

Whether Gender Safeguard: By incorporating the ‘household’ clause for employment, the NREGB –2004 does not provide any safeguard against the exclusion of women from the employment programmes. Our experience shows that even in those schemes where there is a clear preference for women or a clear reservation for women, they are not given the opportunity. Such a phenomenon has a lot to do with the patriarchal form of our society and lack of safeguards against exclusion of women.

Table–4 shows that the share of women in employment generated under poverty alleviation programmes in the rural areas is much lower than their male counterparts. While the proportion of women in the total labourforce is around 37 per cent, they could actually get around 27 per cent of the total mandays generated under wage employment programmes during 1999-2000.


Share of Women in the Schemes Under Wage

Employment Programmes



Total Number of Man days Created ( In Million)

Share of Women (in %)



















# Jawahar Gram Samndhi Yojana +EAS

Source: Women and Men in India 2000, CSO, Ministry of Statistics and Programme Implementation, Government of India.

Therefore, the limit of “100-days per household  per year” as set by the NREGB –2004 may lead to marginalisation of women. Individual work entitlements instead of households should be adopted in the Act. In the absence of individual entitlements, a clear cut reservation of at least 33% should be reserved for women labourers. A deeper analysis of NREGB-2004 therefore unearths a lot of issues obstructing successful and effective implementation of the Employment Guarantee. The civil society should be very careful towards any attempt by the policymakers to escape from their responsibility towards formulating an effective Employment Guarantee policy and then towards its successful implementation.

Mr.Siva Sankar Mohanty is presently working in NCAS, New Delhi and this article is sourced from NCAS published Budget Track.



Self Reliant Village and Villagers

Tusharkanti Ghosh

There is an urgent need of efforts towards making the village self-reliant along with the villagers. Making a village self-reliant means development of the village.  Development of Village requires money and labour. Labour is available in the village itself. But we always depend on the government for money that comes in a zigzag way. In this context it needs to be considered how far village development is possible with the money released by the Government.

Today, if we like to think rightly about the development of village we have to think in other ways. Utilising common resources of the village we can build up a village fund and this fund can be used for all round improvement of the village. Our country mainly depends on agriculture. Keeping this in view, we will have to think about utilizing village resources for the developmental work. Let us see how this thinking can be translated into reality.

The first task is to promote horticulture on the homesteads lands of the villagers for the purpose of increasing their earnings. A part of their products from horticulture will meet their own requirements and the rest will be sold away in the markets thereby increasing their earnings. Those who have not any agricultural land, they can earn their livelihood through these means. With the income from horticulture they can purchase essential commodities like rice, pulses, oil, etc. They have to apply organic fertilizer for this type of agriculture. Chemical fertilizer is not only costly and expensive but also its application gradually destroys the fertility of the soil. Organic fertilizer can be prepared at home through compost pit. Leaves of trees and creepers, ordure and urine of domestic animals etc can be put into the compost pit. Application of manure prepared through this process in the land makes the soil fertile while its products are free from chemical effect. It is desirable to apply pesticides prepared through organic process instead of chemical pesticides.

A village fund can be built up by utilizing common resources of the village. For this purpose wasteland and community land of the village and government land with the permission of the authority can be made cultivable. Different kinds of short term and long term fruit bearing trees can be planted on this land. These trees should be planted in such a manner that vacant space would remain in between two trees. Short duration crops like potato, onion, ginger, turmeric, and vegetables can be grown on the vacant land. Crops needing less quantity of water should be grown in the land where water source is scare or at a very low level. At first, villagers will contribute their manual labour for this work. At a later stage after harvesting and selling out of the crops villagers will get some remuneration in view of their labour. The balance amount will be accounted for and deposited in the village fund. During next period various developmental works can be undertaken spending this money from the fund. Through successful realization of these efforts villagers will get jobs and march forward to become self reliant on the other hand, pisciculture can be undertaken developing village ponds while water from these ponds can be used for cultivation.

The government has to extend some help for the success of these efforts. It will permit the villagers to use the government land; it can help in making and selling of the products. The villagers need to be mentally prepared for this endeavor and the cooperation of a well equipped and trained voluntary organization is specifically required in this case. On the other hand a strong political will and the resolve of the government need to be demonstrated along with the sincere efforts on behalf of the villagers for making this project a reality. At a next stage other possible aspects can be considered and analysed to improve upon the project. It is possible to encourage and motivate the villagers to undertake such programmes following appropriate implementation of the project in one or two villages.

Through this project the village can achieve self reliance and villagers can be provided with jobs throughout the year, nutrious food twice a day, good health services, education for children, adult education and customary cultural functions of the village. Moreover, cooperation of experienced and constructive workers of the village is very much needed for making this plan a reality.

There is need for an elaborated discussion on the village fund. Utilizing the labour contribution of the villagers and money for the village fund a grain bank is to be established in the village. Stocks of rice, paddy, wheat, pulses, etc. are to be stored in the Grain Bank for meeting the urgent needs of the villagers. These items are to be purchased and preserved in the said bank. The villagers will get the food staff on the basis of loan from this bank according to their needs and repay it along with a small measure of crops in addition  to it, after harvesting. For example if a villager has taken a loan of 10 Kgs.  of paddy, he will repay 11 Kgs. In this way, the surplus paddy of the bank can sold away and thus  the money collected from the sale can  be used for developmental work in the village. As a result of the success  of the project, evil influence of the village money lenders  will get reduced. An educated and devoted youth of the village can be engaged in this work and villagers support to him is always essential.

Through the successful realization of this effort, a bright vista for village economy will be opened and the economy of the village will be sustainable. Dealing with the subject, Gandhiji had written  a letter to Jawaharlal Neheru on 5th October 1945. The letter  was very significant  on many counts. In this letter Gandhiji said “ My ideal village will contain intelligent human beings. They will not live in dirt and darkness as animals. Men and women will be free and able to hold their own against anyone in the world. There will be neither plague nor cholera  nor small pox, no one will be idle, no one will wallow in luxury. Everyone will have to contribute his quote of manual labour.”

Again on 13th November, 1945 Gandhiji, wrote another letter to Pandit Nehru and said,    “man is not born to live in isolation but essentially a social animal dependent and interdependent. No one can or should ride on another’s back. If we try to work out the necessary conditions of such a life, we are forced to the conclusion that the unit of society should be a village, or call it small and manageable group of people who would in the ideal, be self sufficient (in the matter of their vital requirements) as a unit and bound together in bonds of mutual cooperation and interdependence.

Meanwhile 58 years have passed since India became free from foreign rule. Yet neither self-reliance is achieved nor Gram Swaraj has been rightly implemented in villages. It is the real experience of those, who keep close contact with the villagers for furthering village development. Of course this has to be kept in mind that 80 percent of the people live in villages and they solely depend on the agriculture. In the first five year plan of our country , agriculture should have been accorded top priority. But that was not the case. Though different governments at different time were thinking of giving priority to the agriculture in reality, none has taken right steps in this direction. Basing on the ideology of Gandhiji, if right steps are not taken now, development of the Indian Economy would not be possible. One has to keep in mind that India is not an economically developed country like the United States of America, Canada or Australia. Unless purchasing power of the villagers is increased, development of the Indian economy cannot be sustainable..

Mr.Tusharikanti Ghosh is the Joint Secretary of Tagore Society for Rural Development. The Society is working in Orissa, West Bengal and other parts of India.




The Schedule Tribe and Forest Dwellers Act-2005

(The proposed bill has been submitted by the Center for Survival and Dignity(CSD), New Delhi to the Union Government).

An Act to record and recognize the rights of Scheduled Tribes and forest dwellers, and to provide for a procedure for verifying and recording their rights in forests and on forest land.  This is because these rights were not verified, recognized or recorded during the declaration of many tribal and other areas as state forests during the colonial period as well as in Independent India either due to faulty and incomplete settlements or settlements not being undertaken. This has resulted in historical injustice to these communities, rendering them as ‘encroachers’ on their ancestral lands in the eyes of the law. The Act also seeks to confer title on holders of leases and pattas on forest land by Revenue Departments under due legal authority and on those in possession of forest land and endowing title to land and homesteads to residents of forest villages and other old habitations on forest land.

The Act defines a verification procedure and clarifies the evidence that may be used to decide the period of enjoyment of rights. As Preliminary Offence Reports/First Information Reports are not necessarily a proof of the claim or otherwise, an assessment of the ground realities as they existed at the relevant time is necessary and is possible by a verification of natural and situational evidence of the subsisting claim. Hence the Act creates a responsible local committee, conversant with ground realities, to verify the same, which can record the evidence of the claimant and other knowledgeable villagers about the length of time that the rights in question have been enjoyed by the claimant.




   (2)   It extends to the whole of India except the State of Jammu and Kashmir.

   (3)   It shall come into force on such dates as the Central Government may, by notification in the Official Gazette, appoint.

2 (1)   In this Act, unless the context otherwise requires

(a)   “Rights” means individual, group and/or community title to land, minor forest produce, and other use rights or entitlements such as grazing and rotational cultivation, use permitted by earlier princely state/zamindari regimes, and claims of shifting cultivators and pre-agricultural communities.

(b)   Such title shall be inheritable but not alienable.

(c)  “Pattas and Leases” means temporary or permanent leases on forest land granted by the competent authorities.

(d)  “Forest land” means land of any description coming within the legal definition of forest, including village forests, protected forests, reserved forests, deemed reserved forests, proposed reserved forest, unclassed forests, all lands recorded as forest in govt. records, protected areas including national parks and wild life sanctuaries.

(e) ‘Verification” means the process of verification of rights as provided for in Chapter III of this Act

(f)   Tribal areas means areas or regions inhabited by tribal communities and shall include the Vth and VIth Schedule areas as well as tribal habitations in MADA, Mini MADA and ATSP / OTSP areas.

(g) PESA means the Panchayats (Extension to the Scheduled Areas) Act 1996

(h) “Claim” is a prayer for recognition of a right, either submitted in writing or stated orally and subsequently reduced to writing, including a description of the nature of the right enjoyed. 

(i)    Claimant means such persons or communities filing a claim for rights under this act whose subsistence and livelihood are or were dependent on the claim land and belong to the Scheduled Tribes or Scheduled Castes and rural poor below the poverty line.

(j)   Words and expressions used but not defined in this Act and defined in the Indian Forest Act, different State Forest Acts, Forest (Conservation) Act, Wildlife Protection Act shall have the meaning assigned to them respectively in the Acts.

(k)  ‘Forest dweller’ shall ordinarily mean Scheduled Tribes, Scheduled Castes and other deprived communities living in or near forests and substantially dependent on forest resources for their subsistence and survival.

  (2)    Any reference in this Act to any enactment or any provision thereof shall, in relation to an area in which such enactment or such provision is not in force, be construed as a reference to the corresponding law, if any, in force in that area. 



3 (1)   Title shall be conferred in respect of forest areas notified as ‘deemed Reserved Forests’ without observing the due process of settlement as provided in Forests Acts provided that these pertain to:

(i)     tribal areas, or affect a whole cross section of rural/poor in non-tribal areas; and

(ii)    the claimants are in possession of the ‘disputed land’ and

(iii)  the claimant was in possession of the disputed land when the notification declaring ‘deemed reserved forests’ was issued

  (2)    Title shall be conferred wherever the process of settlement is over and notification under Section 20 of the Indian Forest Act, 1927 (or corresponding section of the relevant Act) has been issued but there is prima facie evidence that the process of forest settlement has been vitiated by incomplete or incorrect records / maps or lack of information to the affected persons, as prescribed by law, provided that.

(i) The claimants are in possession of the ‘disputed land’ and

(ii) The claimant was in possession of the disputed land when the notification showing Government intention to declare Reserve forest or Protected forest was issued under Section 4 or Section 29 of the Indian Forest Act, 1927 (or corresponding section of the relevant Act).

  (3)   Title shall be granted wherever the process of settlement is over but notification under Section 20 of the Indian Forest Act, 1927 (or corresponding section of the relevant Act) is yet to be issued, particularly where considerable delay has occurred in the issue of final notification under Section 20,

(i)     provided that the claimants are still in possession of ‘disputed land.’ and

(ii) the claimant was in possession of the disputed land when the notification showing Government intention to declare Reserve forest or Protected was issued under Section 4 of the Indian Forest Act, 1927 (or corresponding section of the relevant Act).

  (4)    Title shall be conferred in all the cases of pattas, leases, grants of any description or nomenclature involving forest land whether by intent, omission, oversight or accident. 

(i)     Provided the assignees continue to be in possession of the land or can prove that they were forcefully evicted despite having such pattas/leases, etc.

  (5)    Title shall be conferred in all those cases, where pattas / leases / grants of any description or nomenclature have been given by the Government departments to Scheduled Tribes or rural poor either individually or collectively, but inter departmental disputes have affected the endowment of rights of the lessees   

(i)  Provided the assignees continue to be in possession of the land or can establish through the verification process that they were forcefully evicted despite having such pattas/leases, etc.

(6)         Title shall be conferred in all those cases, where Leases of any description or nomenclature of a period prior to 25.10.1980 which were granted to the Scheduled Tribes or to other rural poor for agro-forestry, tree plantation or alike but could not be renewed, despite the State / UT government’s intention to do so, on account of enactment of the Forest (Conservation) Act, 1980.

(7)        Title shall be conferred to land and homesteads in all forest villages and old habitations on forest land and the said villages or old habitations shall be converted into revenue villages with provision of land for essential social welfare activities such as schools, health centers, common land, etc., provided

(i)  the said forest village or old habitation was in existence prior to 1980 and the assignees or their heirs continue to be in possession of the land & homesteads, or can prove that they were forcefully evicted after 1980 but their rights were not commuted or extinguished in accordance with due process of law.

(ii) village or old habitation in existence after 1980 inhabited of tribal oustees of development projects, who were allowed to reside in the area by forest officials, and the assignees or their heirs continue to be in possession of the land & homesteads and can establish through the verification process that they were allowed to reside by the forest officials at the time.

(8)   Title shall be conferred to land and homesteads to all tribals and rural poor in possession of and cultivating the land, in cases where the state/UT government have passed orders to regularize such encroachment or cultivation provided

(i)     the said possession & cultivation was in existence prior to 1980 and

(ii) the assignees or their heirs continue to be in possession of the land & homesteads or can prove that they were forcefully evicted from these 1980 but their rights were not commuted or extinguished in accordance with due process of law.

(iii) provided the area in possession and cultivation to be regularized shall not exceed the limit permissible under ceiling laws and

(9)   Communal property rights shall be recognized and conferred on pre-agricultural ‘Primitive Tribal Groups’ and shifting cultivators, who, under no circumstances are to be treated as ‘encroachers’ on their ancestral lands. FAO’s practice of classifying shifting cultivation lands as ‘forest fallows’ shall be adopted instead of classifying their customary lands as ‘forests’. A forest governance system for these lands shall be evolved under the purview and authority of the concerned Gram Sabha as per the provisions of Section 4(d) of PESA  in consultation with the concerned communities to enable combining their livelihood uses with maintaining ecosystem integrity.

(10) All families of tribal and rural poor who are not found eligible for endowment of rights under the provisions of this Act at 3(1) to 3(10) above shall be rehabilitated in situ through granting them heritable but inalienable conditional pattas through a Community Managed Forest Conservation Program by gram sabhas as per the provisions of  PESA Act 1996 and permitting them to practice agro-silvi operations pursuant to their protecting mutually demarcated forest areas.

 (11)    The Tribal Welfare Department shall involve peoples’ organizations, CBOs and NGOs in building upon indigenous technical knowledge to evolve appropriate agro-silvi practices that can provide adequate vegetative cover as well as sustainable livelihoods to the poor on degraded forest lands to be designated as Village Forests u/s 28 of the Indian Forest Act and brought under the purview and authority of the concerned Gram Sabha, as per the provisions of Section 4(d) of PESA.

(12)    Usufructory rights to minor forest produce, grazing, firewood, water, fishing, and other activities shall be conferred on tribals or forest dwelling communities who have traditionally enjoyed them.  



4 (1)    A Local Committee shall be established to verify the claims arising from disputed settlements or lack of settlements, pattas and leases and for regularization of encroachments on forestlands constituted by the following members:

a.      Sarpanch / Dy. Sarpanch from the village who will be the Chairperson of the Committee. In the case of a Group Gram Panchayat and for villages other than the main village, a member of the Gram Panchayat from the concerned village will be the Chairperson. In the case of forest settlements not coming under any Gram Panchayat, the traditional/locally accepted Village Elder shall be the chairperson.

b.      2 knowledgeable Village Elders or Senior Citizens from the community of the claimants, selected in the Gram Sabha/Gaon Sabha/Palli Sabha/Ward Sabha specifically called for the purpose.

c.      One woman representative from a Mahila Mandal / Self Help Group / Gram Panchayat selected in the Gram Sabha/Gaon Sabha/Palli Sabha/Ward Sabha called as stated above in b.

d.      Talathi or Patwari, representing the Revenue Department who will be the Secretary of the Committee.

e.      Forest / Beat Guard

f.        Local staff (Supervisory/Inspector level) member of Tribal Welfare Department/ITDA/ITDP in the case of tribal areas.

 (2)    Block or Taluka Level Review Committee

In cases where the claimant is aggrieved by the decision of the local committee, such claimant will have the opportunity to present his/her views to a Review Committee established by the District Level Committee for the purpose, consisting of 

a.      Member of Zilla Parishad who will be the Chairperson

b.      Member of Panchayat Samiti

c.      Naib Tehsildar representing the Revenue Department who will be the Secretary

d.      Assistant Tribal Welfare Officer or Asst. Project Officer (ITDP)

e.      Range Forest Officer

  (3)    District Level Committee

All decisions taken by the Local Committee and decisions on appeals made to the Block Level Review Committee will be forwarded to the District Level Committee for final ratification. The District Level Committee shall not alter decisions taken at the lower level unless a conflict exists between the Local committee and Block Level Committee, or which on the face of the record appears to be blatantly illegal, and the aggrieved claimant applies to the District Level Committee In such cases, the District Level Committee should refer the matter to the Local Committee to reconsider the matter in the light of the observations of the Block Level and/or District Level Committee and the decision of the Local Level Committee shall be deemed to be final. The District Level Committee shall forward their proposals to the State Government which will put the proposals of the district committees together and forward them to the Central Government for approval within a maximum period of one year.  The District Level Committee will be appointed by the District Collector consisting of

a.        Dy. Collector,

b.       Sub-Divisional Forest Officer

c.        Project Officer, nominated by the Tribal Commissioner

d.       Tribal Member of Parliament (if any) or other Members of Parliament of the District

e.        A renowned non-government person known for her/his understanding of tribal-forest issues.

  (4)     Procedure to be followed by the Committees

a.      The Committee should follow procedures that ensure that

i)                    all concerned claimants are informed,

ii)                  all claimants have an opportunity to make their claims in their language,

iii)                 the weaker sections of the community are spared the time and expense of travel,

iv)                all claimants are covered and no person is not given an opportunity to be heard. Calling for and verification of claims shall be done in the gram sabha of the village specifically called by the Local Committee held to ensure maximum participation of the women and men of the community. Every effort shall be made to secure the presence of at least 50% of the village adults with half of them being women.

b.      A timetable giving the dates and time of meetings of the gram sabha should be prepared and publicized in advance within a fixed time period.

a.      to select two village elders or senior citizens to act as members of the committee

b.      for the Local Committee to invite claims supported by evidence

c.      for the Local Committee to verify the claims and present their findings  

c.      An inspector and an Area Officer must be appointed to ensure that the program is conducted in a disciplined and regulated manner to enhance local women and men’s participation.

d.      Traditional methods of publicity in the local language as well as advertisements in the local newspapers must be used to inform the people about the program of deciding the eligibility of claims. Field staff of rural development, social welfare, ICDS, etc should be involved in disseminating information about the process, particularly to village women through their organizations such as SHGs and Mahila Manuals.

e.      Information of the task of the committee, its aims, objectives and procedure should be made available in the village square, Gram Panchayat office of all villages, Panchayat Samiti and Tensile office as well as to ICDS, RD, health and education department staff. Special attention should be given to reaching remote settlements and unsurveyed villages which may not be covered by the PRI structure.

f.       After publicizing the program of the gram sabha atleast two weeks in advance a gram sabha calling for claims should be conducted by the village committee.

g.      On receipt of the complete application of the concerned claimant in Gram Sabha, all claims should be verified in the presence of the assembly in a subsequent Gram Sabha specifically called for the purpose.

h.      The Local Committee will give its findings and decision in writing to the claimants in the gram sabha called for the purpose.

i.        All appeals will be heard by the Block Review Committee or District Committee as the case may be after 2 weeks notice to the appellant.



5.         Nature of Evidence to be Adduced before the Local/Block Committees

(1)   A variety of evidence, both oral and/or documentary, establishing the claim period can be regarded as proof of the claim, hence the Committee can accept the following as evidence.

i)        Documentary evidence from any Governmental / Semi-Governmental source

ii)       Documentary evidence from any prior research or documentation of a reputed institution, including survey maps.

iii)     Relevant circumstantial evidence gathered by more than 3 members of the committee from a spot verification

iv)    Resolution of the Gram Sabha

v)      The evidence of neighboring cultivators and of senior citizens of the villages

vi)    An affidavit submitted in the village assembly by the claimant.

  6.     Criteria for Accepting Claims

(1)      While deciding on the claim, the village level committee should pay attention to the following guidelines.   

i)        All claims where the claimant has government/ semi government/ other relevant documentary evidence in support should be accepted.

ii)       If a claimant does not have documentary evidence in support of her/his claim but the Gram Sabha on the basis of other relevant evidence is of the opinion that the claim is legitimate, such claims should be carefully examined by the Local Committee and the benefit of doubt should be given to the claimant. Decisions of the Local Committee shall be by simple majority.

iii)     If the claimant does not have relevant documentary evidence and the Gram Sabha has also rejected her/his claim, then the veracity of such claims should be carefully examined by the local committee and such claims should be specifically referred to the Review Committee.

iv)    All claims that are upheld within the purview of the guidelines laid down by the Government of India in its orders dated 18/9/1990, 3/2/2004 and 5/2/2004 be forwarded to the State government for appropriate action.

v)      Necessary steps be taken for in situ rehabilitation, in cases of ineligible claimants belonging to Scheduled Tribe, Scheduled Caste or Families.



7.         Training and Publicity Workshop at Taluka Level   

The following process be adopted with a view to expedite the process and ensure fairness.

(1)    Pre-planned publicity and training workshops be organized by the District Committee with the assistance of  knowledgeable NGOs at the taluka level for Sarpanchas, Dy. Sarpanchs, Panchayat Samithi and Zilla Parishad members, Forest Officers and Functionaries, Tribal Welfare Officers and functionaries, Traditional Leaders, Senior Citizens, Journalists, Revenue Officials and Functionaries, Talathis and members of the Taluka / Village level Committees, after due publicity prior to the initiation of the process of verification.

(2)    All Officials should be invited to these workshops and should be given the information of the procedures and processes of the village level inquiry.

(3)   A separate session should be held for NGOs, CBOs, Activists, Advocates and Journalists

(4)   The Gram Sabhas should be held after the program is planned and announced 



 8 (1) The Verification of Rights and Resolution of all conflicts related to forest lands, disputes resulting from defective Settlements, leases/pattas etc, completing settlements where these have still not been undertaken, regularization of pre 1980 encroachments and conversion of all forest villages and other older settlements into revenue villages shall be completed within two years from the passage of this Act, which period may be extended by the government if circumstances so require.

(2)  All Claimants whose claims have been accepted after verification will be issued a certificate by the District Committee specifying the location and area of the accepted claim.

(3)  Appropriate entries shall be made in the relevant land records regarding the acceptance of claims.

(4)  Completed proposals shall be forwarded to the Ministry of Environment and Forests, which will complete all formalities within six months.

(5)  The Endowment of Rights and Entitlements may be done in such a manner as to avoid honey combing of the forests, as far as possible. In case of honeycombing, the claimant will be provided alternative land on the fringes of the forest and financial support to develop the said land.

(6)  Title shall be conferred free of all encumbrances, including requirements of Net Present Value and Compensatory Afforestation for diversion of forest land.

(7)  The Endowment of Rights may be made conditional on the right holders accepting responsibility for protecting/regenerating mutually demarcated degraded forest lands in the vicinity of their endowments in order to integrate livelihoods with conservation.

(8)  The Ministry of Tribal Affairs shall be designated as the Nodal Agency and shall be responsible for implementation of this Act.



 Recognise the  Legitmate Rights of Adivasis & Dalits on Forest Land

  A report on the Workshop on “Recognizing of Adivsis and Forest Dwellers Rights on Forest land” organized by ODAF on March 11-12th at Red Cross Bhavan, Bhubaneswar

The Ministry of Environment & Forest (MoEF) had issued a guideline in 1990 mentioning that the Government will take steps to regularize  the forest lands occupied and used by the Adivasis/Forest dwellers prior to 25th October, 1980  on the basis of some criteria developed by the government, Consequently, the state governments can seek permission from the Central Government for regularization of the ‘encroached’ land. But the interim order issued by the Supreme Court on 23rd December 2001 had refrained the governments from legitimating the encroached habitations in the forest land. On the basis of interim order, the Ministry of Environment and Forest announced that those encroachments, which had been illegal as per the guideline framed by the Chief Conservator of Forests, would be evicted. The resistance by the people and NGOs about the decision of the government compelled the court to form a High Powered Committee and the committee submitted its recommendation to Supreme Court on 24th September 2002.

Moreover, the guideline issued by the Chief Conservator of Forests on 5th February 2004, conferred Pattas/Records to the Adivasis on the forest land.ODAF has been advocating for a comprehensive Adivasi Policy, particularly demanding for the recognition of legitimate usufruct rights of Adivasis on land, water and forests, since its inception and particularly from 1999.

At the National level, the National Campaign for Survival & Dignity (NCSD) is spearheading the campaign and drafted a bill as “ Recognizing of Adivasis and Forest Dwellers Rights on Forest Land”. In this backdrop, ODAF organised a workshop on March 11th & 12th at Bhubaneswar to discuss and suggest recommendations on the draft bill prepared by NCSD. Leading Activists of the State, leaders of Adivasi organisations, Anthropologist Prof.L. K. Mahapatra, Environmentalist Mr. N. C. Kanungo along with many others intellectuals participated in the workshop and dwell on the NCDS drafted bill. Inaugurating the workshop the Executive Secretary of ODAF extended all cooperation for this campaign initiated by NCSD.

A Drafting Committee was formed to streamline the campaign and incorporate necessary recommendations of the workshop in the proposed bill.

In the Workshop the Adivasi leaders asserted their demands such as :

1.      Recognizing forest lands as revenue lands.

2.      Involvement of CBOs, POs and Social Activists in the committees formed at the levels of district, block and village to verify the records of the applicants.

3.      Accord importance on community owned resources.

4.      Extension of  all kinds of facilities, provided to the Adivasis, to the Adivasis  in non-scheduled areas.

5.      Issuance of  land patta in the name of both wife and husband.

6.      Incorporation of  other constitutional rights apart from land rights.

To further the campaign for asserting the rights of Adivasis on the forest land, the following measures are suggested as the future course of action:

-Various committees starting from the village to district level would be formed to monitor and coordinate the campaign.

- Awareness building among the Adivasis about their genuine rights on forest land.

-  Involvement of activists associated with other struggle movements.

- Formation of a Think Tank to incorporate suggestions in the proposed draft prepared by NCSD and make necessary coordination with bureaucrats and legislatures.

- Formation of a state level pressure group to  impress upon the Government.

- Organization of press conference for sensitizing the media about the issue.

Some of the recommendations of  the workshop:

  • The Gram Sabha should be constituted recognizing the traditional village community
  • Adivasi opinion should be final on plantation in schedule area land.
  • Plantation of traditional trees should be promoted on forest land/ community land.

The participants expressed consensus that faulty policies and Improper implementation of existing laws is one of the major factors behind the destruction of forests not the Adivasis.




Global Week of Action

Free Trade and Privatisation, the much advocated funda of the rich and powerful countries is the institution, condition and rule of international trade that keeps the poor people poor. The rich countries, which control international fiancial institutions, force the poor to follow their advice and attach conditions to loans and debt repayment, maintain double standard by telling the poor countries to remove trade barriers and privatise their baic services where as they continue to subsidise and protect their industries and farmer.

In this backdrop, there was an initiation as “Trade Justice Movement” (TJM) at the global level to fight against poverty, neo-liberal imperialism and unjust trade rules. The movement was being spearheaded and supported by more than 50 organisations from trade unions, aid agencies, human rights campaigns, fair trade organisations, NGOs and Consumer groups that have over 9 million members. Together, the organizations were campaigning for trade justice - not free trade - with the rules weighted to benefit poor people and the environment.  To spearhead the process, members around the globe decided to mark a week i.e. 10th-16th April 2005 as Global Week of Action (GWA). It called out the world leaders to change the rules of trade in favour poor so that the third world countries can protect the interests of the farmers, industry and environment.

A series of events including rally, exhibition, public meeting, postcard campaign, signature campaign and email campaign were organised massively by more than 70. countries where millions of people took collective action to say that Free Trade is not working and demand to stop forcing economic liberlisation on the world’s poor. GWA demanded to stop the EU's free-trade agreements with former colonies, end to the IMF and World Bank setting poor countries' trade policies, special treatment for poor countries at the WTO, Cut the massive export subsidies used in rich countries, Debt cancellation and aid increases must not be used to further impose free trade.

Orissa level GWA process was being piloted by ODAF, CYSD & OVM. As follow up, a preparatory meeting was organized on 5th April 2005 and  leaflets and posters were sent to a various NGOs and a memorandum was submitted to the Prime Minister of India. A State Level Consultation was also organized on 15th April 2005 at Institute of Engineers Conference Hall in Bhubanswar. In the State Level convention more than hundreds of people from different parts of the state participated. The veteran Communist Leader Mr.Shivaji Patnaik,  Mr.Jagadananda, Member Secretary, CYSD, Mr.Panchanan Kanunago Ex Finance Minister of Orissa, Prof Abani Baral, Educationsist, Mr.Kalyan Rao, Retd. Bureaucrat, Mr.Souribandhu Kar,Trade Union Leader,Dr.Basudev Sahoo, Economist and Social Activists Mr.Sukant Mohanty, Secretary,Seva Bharati, Mr.Jagdish Pradhan, Secretary, Sahvagi Vikas Abhiyan Mr. Bharat Bhushan Thakur,Ekta Parishad etc deliberated different implications of liberalization on the Indian Economy.




Jailor is a small tribal village situated in Ankuli Gram Panchayat under Patarapur Block of Ganjam district. Surrounded by forest, it is situated in Sita Srunga range of hills at a height of about 1000 metres. Thirty four families belonging to Bhima Soura race live in there. No government servant ever pays a visit to this village due to inaccessible location. People here are deprived of the facilities to meet their basic necessities of life, viz, primary education and health care etc.

A couple of families only have some areas of cultivable land. Shifting cultivation is the main occupation of the villagers. They live at bogodo sites for about 7 months a year and take up agricultural activities for food production. They manage only 6 to 7 month with the food grains that they produce in bogodos. They depend on sahukars (money lenders) living in nearby villages, namely, Hukuma and Mandarada. The Sahukars sell them food grains on credit and lend money at exorbitant rates of interest taking advantage of their simplicity and illiteracy the poor tribals are used to tolerate the exploitative tactics of the unscrupulous sahukars.

Gram Vikas first stepped into Puriasahi, another tribal village of Patrapur Block, in the year 1990. all the tribal villages of Patrapur Block are situated in hilly and difficult area and the only exception Puriasahi is situated in plains. Gram Vikas intervention was through the opening of non-formal education centers. Children in the age group of 6 – 14 years were taught in the non-formal education centers in order that they would know some thing about the outside world. Besides, Gram Vikas staff provided medical aid to the patients. Thus it gained the confidence of the tribals and they respected the organisation as their God. Thus came into existence the Tumba Integrated Development Project of Gram Vikas.

In 1996, Gram Vikas launched its secure livelihood activities in each of its working villages. Activities, viz, development of agriculture, horticulture, goatery, livestock, land and stone fencing of fields etc. were taken up under the guidance of Gram Vikas staff. Inputs were also provided in cash and kind for the purpose.

Bhima Badamundi of Jalior village depended on shifting cultivation to maintain his family. The yield of food grains from bogodo was just sufficient to maintain his family for 7 – 8 months and he maintained his family during the remaining part of the year by borrowing from money lenders. They exploited the poor tribal by charging very high rate of interest for the money lent by them. His family consisted of him self and four others. All of them depended on him for maintenance. They passed on their days with great difficulty due to abject poverty. Taking advantage of the situation, the money lenders would come and take away their utensils. They would also take his fruit bearing trees by way of mortgage using manipulative tactics. They situation became unbearable, but he had no options. Such was his sad plight that he could not provide medical treatment to his old parents.

He narrated his agonies before Gram Vikas staff who provided immediate support to relieve him from the clutches of the money lenders. With the financial support he got from Gram Vikas and with his own labour, he put up a stone fence around an acre of land that belonged to him. He planted seedlings of different species in his newly fenced field and got a good return for his sincere efforts.

He got a good income. He got the mortgaged property released from the money lenders. Next year; i.e. 2002, he got a profit of Rs. 3400/-. With this he cleared all his loans, supported his nephew in continuing his studies and for payment of examination fee at Khariaguda School. Next year he cultivated turmeric. From 90 Kg, he got about 500 Kg, besides pineapples 100 and lemon 1000. he got about Rs. 5000/- from the sale proceeds. He had constructed a pucca house taking housing loan from Gram Vikas. He started making repayments. He does not face any financial difficulty now for maintenance of his family. His nephew whom he had supported in his studies is now serving as a facilitator in an educational centre.

It’s an eye opener. The efforts of Bhima Badamundi have opened the eyes of others as to how one can achieve self sufficiency through hard labour. Local people are discussing his activities and visiting his garden. People of Dhanabada, Jalior and Khalasahi are trying to replicate what Bhima Badamundi has done in his field.

 (“Gram Vikas” is the Founder Member of ODAF.It has been working in the tribal dominated districts of Orissa for last 25 years.)



About Us

 By early nineties, some concerned citizens and Civil Society Groups had started exploring the causes of the drought and ways and means towards a long-term response through capacity building and asserting rights over the resources at the Community level. In 1987, EZE Germany had facilitated a consultation with selected NGOs to respond to a severe drought situation in Orissa. To address to the immediate situation and to follow it up with long-term measures, a collective of selected Non Government Organisations was formed in 1988 named as ‘Orissa Drought Action Forum’ (ODAF). Over the next five years, the focus broadened from drought to development and enabled the Forum to address the issues of sustainable development through a guided vision and long-term strategy towards a Secure Sustainable Livelihood. To be in sync with the vision & mission, the collective was renamed as ‘Orissa Development Action Forum’ in 1996. Now, it has a membership of 12 NGOs, namely, Gram Vikas, ACM, IRDWSI, SEDP, TSRD, CPSW, SB, PIPAR, RAD, SPVK, CReNIEO and SVK. 

At present, ODAF members are working in partnership with the Adivasis, Dalits and the economically exploited bonded labourers, landless small farmers and rural artisans in about 1039 villages spread over 38 blocks in 13 districts, mostly characterised with hilly, forested features in Northern, Southern and Central Orissa. 

Vision : A just social order, ecologically sustainable, secured, self reliant communities maintaining harmony between humankind and nature, an interdependent holistic society in which human rights, dignity of women and men are equally realised through a sustained participatory process and a self governed community.

The broad operational strategies are Empowerment of Marginalized Communities, Promotion of Sustainable Livelihood, Promotion of Community Health, Advocacy & Alliance Building, Other Developmental Measures as Disaster Preparedness, Alternative Energy Options etc.

The uniqueness of ODAF lies in the nature of mutual trust and democratic structures established over the years. The process of decision making at all levels are participatory and transparent resulting in the evolution of a genuine Collective. The binding force stems from collective recollections of involvement in the past and a shared perception, experiences and analysis for a sustained people centered development. 

The Secretariat of ODAF is established at Bhubaneswar  to coordinate the forum activities, planning and implementation of meetings, training, consultancy, coordination and monitoring of member NGOs programmes.  



Readers Column

*Dear Editorial Team,

Thank you, keep it up,

Pradeep Esteves
Finance Consultant, Bangalore

*Dear Editors,

Everything is fine and are in line with. Only one thing I would like to suggest you that keep  A space for the opinions of the readers. 

Sukanta kumar Mohanty, Secretary,Seva Bharati

*Dear Editors,
A fine attempt. Look forward for its impact on Govt. 
Nihar, Coordinator, ODMM

This is to confirm that I have recd a post copy of the Sandesh and enjoyed reading it,              congrats to the editorial team. 

warm best regards, 

Dr.K.C.Malahotra, Anthropologist, New Delhi

*Dear Editors,

We have received Sandesh and thanks for your efforts


P.K.Mishra, Secretary, IRO,Keonjhar


An Adivasi boy speaking about  the adivasi land rights in the workshop

Dr. William Stanley, Executive Secretary, ODAF Inaugurating the Workshop

Prof. L.K.Mahapatra & Mr. Nadia chandra Kanungo giving their opinion in the workshop

Group Discussion in the Workshop

State Level Convention on GWA

State Level Convention on GWA