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Kerala -#Demonetisation Is Affecting Migrant Labourers

By RAHUL M | 

“It was like hitting hard at the bird’s nest with a stone,” said P Somu, a Dalit migrant labourer, who travelled from Mudigubba mandal of Anantapur district in Andhra Pradesh to Cochin to work. He said, “It’s the same feeling I got after I was cheated by [the agro-based retail conglomerate] AgriGold. I had sold the cow and calf I loved.” When I met Somu on 12 November 2016, he described the impact of demonetisation as reminiscent of AgriGold. Established in 1995, the AgriGold Group was based in Vijaywada, in Andhra Pradesh. In 2007, it publicised a scheme through which it invited deposits in its companies, promising investors either double the returns or a residential plot in lieu of the amount deposited. However, AgriGold gave these investors neither the promised money nor the registered plots.

Upon receiving numerous complaints against AgriGold from depositors, the Crime Investigation Department, or CID, launched an investigation into the case on 5 January 2015. The investigation revealed that over 19 lakh people from Andhra Pradesh alone had deposited an amount of approximately Rs 1,182 crore in favour of the conglomerate. Somu, one such depositor, invested small amounts every day with AgriGold for around three years. By 2015, he had invested over Rs 10,000 with the conglomerate and was hoping to receive over Rs 20,000 in return. Based on this assumption, Somu sold his cow and calf and all his goats to repay debts he had taken for his sister’s wedding. Although he was attached to his cow and calf, he was confident that he would be able to buy them back with the money he would receive from AgriGold. The returns never materialised. By July 2016, Somu was compelled to accept that he had lost his money when the phone of the AgriGold agent with whom he had deposited his money, stopped working. Farmers such as him were left broke and desperate. He never did forget his cow and calf, and showed me a picture of them that he carries everywhere.


On 11 November, three days after Prime Minister Narendra Modi announced that notes of Rs 500 and 1,000 would be demonetised, Somu only had his wages from the previous week—a few notes of Rs 500 paid for each day’s work. He stayed hungry that night. The next morning, he had some tea and snacks that his mastree—mason—gave him before he left for work. Through the day, Somu finished his work even though he was starving because he did not want to appear hungry or ask others for food. Later at night, when he called up his wife and children, he told them that everything was fine. Somu told me that the three other migrants he stayed with did not have valid tenders either. All of them starved together.

Kerala reportedly has 40 lakh migrant workers among its population—the highest of any state in India. The district with the highest number of migrants is Ernakulam, in Cochin—about 8 lakh. Many migrant labourers who work for daily wages, whom I met in Cochin, told me that they continued to be paid in Rs 500 notes even after Modi declared that they would no longer be legal tender. Without any bargaining power, the labourers told me that they are compelled to accept payment in demonetised currency—essentially worthless pieces of paper. Soma Shekhar Reddy, a farmer from Chennekottapalli mandal of Anantapur district whose groundnut crop had failed this year, came to Kerala for work a week before Modi’s announcement. He had been earning approximately Rs 700 per workday. “I got three days of work”— between 9 November and 12 November—“and was paid in three Rs 500 notes for each day of work.” “It is becoming increasingly difficult to find work now,” Reddy said, when I spoke to him on 12 November, at Kaloor junction. Like many others, he decided against waiting for work. He left for Chennekottapalli the next day. Several migrant labourers told me that only labourers who stayed for a longer duration and had established relations with their employers continue to receive work regularly. These labourers, some told me, have been getting their payments through cheques or assurances instead of the old currency. However, most are not as fortunate. “We weren’t paid any money for this week’s work. The contractor told us that we would be paid next week,” said Sujeet, a labourer from West Bengal who was working on Cochin’s metro rail construction.

Migrant labourers from regions such as Anantapur in Andhra Pradesh arrive at Cochin’s Kaloor junction on a daily basis. On 13 November, one labourer told me that during some months, the junction was witness to as many as 2,000 people. The labourers said that since 9 November, only lottery-ticket sellers at the junction were accepting notes of Rs 500 and Rs 1000. However, they would agree to do so only if the buyer was purchasing at least one stack of ten tickets with the same number. “If your number wins the lottery, you get ten times more money,” a lottery-ticket seller told me in justification of this practice. On 11 November, Somu said, he and his friends were so hungry that they purchased one stack of ten lottery tickets worth Rs 300 between the four of them, just so they could get change for a 500-rupee note.

The labourers said that it had been a challenge for them to exchange the demonetised notes in their possession. Many of them stand on the roadside through the day, where they also sleep at night, till someone picks them up for work. Reddy explained: “We start waiting by 7 am every day. The banks open at 10 am. If we want the money exchanged then we might lose work for one day.”

Baba Fakruddin, another groundnut farmer who works as a migrant labourer, told me that he wanted to exchange Rs 4,000, all of which he had in notes of Rs 500, at a Canara Bank branch in Kaloor. Although he had carried his Aadhaar card for identification, Fakruddin was unable to exchange his money because he had an SBI account and most banks tended to prioritise their customers over others. “I always carry my Aadhaar card. It might help identify my body and send it back home in case I die,” he told me. The officials at Canara Bank asked Fakruddin to exchange the money at an SBI bank branch instead. The labourers I spoke to told me that those from the northern states tend to get harassed more than those from states in South India. “People at the bank asked us if we are from Pakistan or Bangladesh,” said Sebastian, a 25-year-old migrant labourer from Odisha.

Baba Fakruddin, who was refused exchange at one bank, returns to a different bank with his money.

Baba Fakruddin, who was refused exchange at one bank, returns to a different bank with his money.

Even after they exchange the banknotes, the labourers said, it’s hard to use them. On 12 November, Somu managed to get a new Rs 2,000 note. But none of the shopkeepers could accept it because it would eat away all their lower denomination notes. He went to the railway station with one of his friends and offered to pay for his train ticket home with the note, but even the person at the ticket counter couldn’t accept it. Ironically, he finally purchased his friend’s ticket with a note of Rs 1,000, which the ticket counter was compelled—as per the government’s directions—to accept.

Since the demonetisation announcement, the labourers told me that the number of employers seeking daily-wage labourers has reduced in Kaloor. Consequently, migrant labourers have started returning home instead of accumulating more notes of Rs 500 and Rs 1000. Many told me they hope that the bank branches in their home towns would be kinder and more accessible. A small group of the migrants, however, appeared hopeful of a new opportunity that had been presented to them. “A friend said he would call me in the evening because a man wanted to meet a few of us to discuss something,” a young migrant from Kadiri taluk of Anantapur district who did not want to be named said on 12 November evening, “It seems this man has about Rs 15 crore of black money in cash.” The young migrant told me that this man was allegedly willing to give a commission to select migrants if they held some of his money in their bank accounts. But the labourer’s friend never called him. “No word from him yet, he probably didn’t trust us enough,” he told me the next morning when I met him again. Although the migrant was disappointed, he also seemed relieved that he did not resort to conducting illegal transactions.

How Demonetisation Is Affecting Migrant Labourers in Kerala

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Comment (1)

  1. K SHESHU BABU

    The withdrawal of notes has caused hardships to migrant workers.this savings in notes of five hundred and thousands have left them distressed and frustrated. Despite standing in long queues, they are unable to find exchange of notes.

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