Can prayers move policy makers? Well, the St Thomas Church at Pala in Kerala’sKottayam district, the nerve centre of rubber cultivation in the country, recently saw an unlikely bunch of worshippers who had congregated for a week of invocation. Some 500 rubber cultivators communed with the gods through the week for prayers that lasted from morning to dusk. The objective: to persuade the divine to lift rubber prices.
“Prices may not rise directly on account of the prayers. But the prayers will help the policy makers to see things in a better perspective,” avers Father Thomas Malayil.
Appeals, memoranda and even strikes — the 10 lakh-odd rubber farmers and their families in the state have tried it all to convince the policy makers about the need to curb imports and improve domestic prices. So when even hartals fail, there’s only one option left: prayers of intercession for divine intervention.
Farmers in Kerala’s rubber belt — comprising districts like Kottayam, Pathanamthitta andIdukki — have been going through one of the worst phases of price fall in rubber in a long time, with prices plunging to less Rs 100 per kg for a few weeks. At the time of writing, there was a minor recovery of sorts to around Rs 140, but that’s still at least 40% lower than the peak level of Rs 240 per kg last year.
The Rubber Economy
Just as the Kerala economy is dependent on the remittances from abroad, the financial fortunes of Kottayam district and its neighbouring suburbs are closely linked to the price movements of natural rubber. Any wide fluctuation in the prices is immediately reflected in the overall economy of the district.
The sluggishness set in after Onam last September. Cruelly enough, the softening of prices began just after the harvest festival. When rubber prices peaked four years ago, there was a perceptible air of prosperity. The mood of the people in the realty sector, trading establishments and retail shops was distinctly upbeat as locals had dollops of disposable income to splurge. Luxury cars and construction of swanky villas were a common sight. Today, the scenario has changed drastically. Though there is the usual bustle of vehicles plying and people going to work, the spring is missing in their steps. The swagger has given way to despondency, and restaurants and supermarkets aren’t quite bustling.
“People are buying only what is necessary. There are few takers for the gifting items as they are something that customers can forgo easily,” says a cashier at Sugar n Spice supermarket in Kottayam town. “Sales are down by 40%. The flow of middle-class customers has come down to a trickle, hitting sales of cheaper footwear,” rues a proprietor of a footwear retailer. Rubber farmers have now learned to live frugally. Father Malayil says that fewer invitations are being sent out for marriages held in the church. “The feast is also not as grand as it used to be. People have been cutting costs wherever possible.”
Ripple Effect
CJ Augustine, former general secretary of Indian Rubber Dealers Federation, says farmers have to get a price of at least `130 per kg for rubber cultivation to be profitable. This is because costs involved in cultivation have seen a substantial rise. For instance, tapping costs have increased 10 times over the past few years. The cost of chemicals, labour and land development has gone up, too. The intensity of the rubber price crisis hits you when you visit venues that were conspicuous for consumption. For instance, it was customary to see crowds at Aida restaurant in Kottayam at lunch time. These days empty halls greet you as eating out has become a luxury.
The closure of the bar has compounded the woes of the restaurant. The state government had closed all bars in the state except in five-star and four-star hotels. Not surprisingly, the restaurant’s income has shrunk. “Our daily income used to be around rs 1 lakh. We are getting one third of it,” says operations manager of Aida Hotel George Kuruvila. To attract customers, the restaurant has made changes in its menu and reduced prices. Three years back when rubber prices were at their peak, buying a plantation was a costly affair.
Real estate prices shot up as more and more land got converted into rubber plantations. But today, along with the rubber prices, real estate prices have also crashed, says Augustine. Land prices have tanked 50% from Rs 1 crore per acre, he adds. “Only those who are ready for replanting can convert the rubber price fall into an opportunity,” explains Augustine, adding that the prices will bounce back once they start tapping after six to seven years.
Many others who were solely dependent on rubber have started looking at other crops. In fact, some of them have even cut down their rubber trees and planted pepper or cocoa. There are those who have converted their rubber plantations into pineapple fields. At Thodupuza, the headquarters of Dhanwanthari Ayurveda Vydyasala, Dr Satish Namboodiri says the income squeeze is so harsh that people seek medical aid only if it is absolute necessary. “The worst affected is ayurvedic rejuvenation and wellness therapy,” he adds.
The impact of the plunge in rubber prices is felt more in the interior areas away from Kottayam. This is because in the town rubber could be a side business and people may have other regular work for income. But those in the interiors depend completely on rubber and have no option but to cut expenses. Thodupuzha town is feeling the pinch. The suburbs of the town are a part of the rubber belt and money from the crop is a key lubricant that keeps the trade thriving in the town. Idling autorickshaws is perhaps an indication that people prefer to stay indoors to going out and spending money.
“Sales have declined by 15%. Even for wedding clothes, people are spending carefully,” says Roger John, director of Pulimoottil Silks, a prominent textile showroom in Thodupuzha. “When there is a money crunch, spending drops in men’s wear,” he adds. After a dull Onam sale, he was looking forward to a vibrant Christmas. With a predominant Christian population in the town, Christmas is usually a spirited shopping season. Not this time.
“The only positive we found was the purchases by NRKs [non-resident Keralites]. A lot of them from the US, West Asia, Australia and New Zealand had landed here for their annual vacation and they came to shop much to our relief,” adds John.
Question of Survival
The crash in prices is also taking a toll on those who had incurred debts for sending their children to good colleges and schools. Others had borrowed for renovation of their houses or taken an automobile loan. Though farmers are used to the cyclical nature of agricultural prices, the possibility of such a steep fall did not occur to them. “Those who incurred debts are in real trouble as today they cannot repay,” Augustine points out. The rubber price fall and the resultant income squeeze have had an impact on construction activities, which have come to a virtual standstill in the rubber belt.
In the Thodupuzha industrial park, many small industrial units making construction materials have closed down, says N Anoop, president of the Kerala State Small Industries Association, Idukki. Those depending on a single crop — rubber — are the worst affected. Intercropping in the rubber plantations would have minimized the impact of the price fall. But very few have seriously taken it up in their fields. Farmers in the Pala belt feel this price fall would be an eye-opener for all. The profitability of rubber farmers is higher in other states like Tripura, Karnataka, Odisha, Tamil Nadu, Assam and Goa as land prices are lower and labour is cheaper than in Kerala. Augustine says that in future the expansion of rubber cultivation would be to these states.
“If it happens Kerala will lose its monopoly of rubber production.” Pragmatically that may not be such a bad thing for rubber growers but for lakhs of Keralites who have built their fortunes around rubber cultivation — right from processors to dealers to tappers in the plantations — that may sound like a virtual death knell.
– India Times
