Kerala 2005 - of Planning Commission

CHAPTER 5
HUMAN DEVELOPMENT AND ECONOMIC GROWTH
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Box 5.2: The Headload Workers
A phenomenon, which has been unique to Kerala, is the category of casual worker, who is referred to as a 'headload'
worker, almost exclusively male. The Kerala Headload Workers’ Act, 1978 (Act 20 of 1980) defined a headload worker
as “a person engaged directly or through a contractor in or for an establishment whether for wages or not for loading or
carrying on head or person or in a trolley any article or articles for wages”. This definition, of course, does not include
those workers employed by private parties for domestic or non-commercial purposes or those who are self-employed.
Hence, the worker could be ‘attached’ to an employer, ‘unattached’ and scattered. While there is no clear statistical
evidence, a study suggests that there was a quantum increase in their numbers in the 1970s, the period of severe
unemployment in Kerala, just prior to the exodus to Gulf countries and only a miniscule proportion was in the category
of ‘attached’ headload worker. The end of the 1970s also saw the beginning of the ‘consumption boom’ in Kerala, with
the inflow of remittances from migrants and trade in goods gained considerable momentum, generating a demand for
headload workers. This category of worker also perhaps reflects the archetype of a casual worker, unskilled, with no
regularity of work or employer and hence scattered and completely ‘unprotected’. While such characteristics act strongly
to weaken the bargaining position of workers, the booming trading activities gave them some advantage. What drew
wide attention to these workers was the emergence of a strong trade union movement among them, which was used to
extract exorbitant rates for loading/unloading and the ‘attached’ workers became powerful enough to procure a wage
even without performing any work. Their demands, even for domestic purposes (shifting house), could sometimes be
outrageous and it became common for individuals to shift at night to avoid a confrontation. While this behaviour was
condemned, their vulnerability was also recognised and hence public policy attempted on the one hand to regulate
such malpractices (through the Headload Workers’ Act, 1978) and provide some form of social protection and make
work more regular (through the Kerala Headload Workers’ Welfare Fund, 1984) on the other. Some of the excesses
of such workers did strengthen the poor image of Kerala as an investor unfriendly state, especially among the smaller
entrepreneurs. Even though such unlawful practices may have come down, particularly in respect of domestic purposes,
industry/commercial circles continue to report this as a sizeable deterrent to investment. A new Act, The Kerala Loading
and Unloading (Regulation of Wages and Restriction of Unlawful Practices) Act, was passed by the Kerala Assembly in
2002. It emphasises the right to employ workers of own choice, specifying establishments such as industrial parks, export
processing zones, tourism protected area, markets, etc. Wages would also be regulated in the manner notified.
No doubt, the primary fuel for the phenomenal growth in
communication and banking came from overseas emigration.
And transport infrastructure has always been a corollary to
social infrastructure. It is significant to note that the development
of such infrastructure is as vital for industrialisation and
urbanisation, as for the emergence of the service sector, but
Kerala has moved in the direction of becoming a tertiary
economy rather than an industrial one. Thus, despite a thriving
banking sector, with an annual average growth rate of nearly
20 per cent in deposits (since 1988), and a wide transport and
communication network, resources could not be translated
into industrial investment in sufficient strength. Was it, as an
argument goes, on account of non-accessibility to credit?
3.2 Low Credit-Deposit Ratio
Despite the spectacular growth in deposits, the
credit-deposit ratio (CDR) of Kerala has been one of
the lowest in India. It remains more or less stagnant at
42 per cent. It reflects that credit disbursements are not on
par with deposit mobilisation in the State. Note that CDR
is a product of the ratio of the number of credit accounts
to deposit accounts and the ratio of credit amount per
account to deposit amount per account. While the first
of these ratios for Kerala (ratio of the number of credit
accounts to deposit accounts) is one of the highest in
India, the second (ratio of credit amount per account to
deposit amount per account) is much lower, because
the credit amount per account of Kerala is one of the
lowest in India, though the deposit amount per account
is comparable with the all-India level. 10 The low credit
amount per account, in turn, indicates credit deployment
in favour of ‘small’ customers, such as in small-scale/mini
industries, and for housing and vehicle loans. Evidently,
large industries are left out; 11 and the causes are worth
analysing.
10 Government of Kerala (2002: 359).
11 Ibid.