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April 2003, Volume 9, Number 2

China, India, Vietnam

China has about a third of the world's 1.5 billion farmers, and many of them are migrating to cities. There are 94 to 130 million internal migrants in China, and their number is expected to rise--the surplus rural work force is estimated at 150 to 180 million.

Some 900 million of China's 1.3 billion people live in the countryside, and 30 million of them still live under the poverty line; if the poverty benchmark were raised to 200 yuan, there would be 90 million rural poor. Rural incomes were 55 percent of urban incomes in 1983, but only 35 percent as high in 2001--$285 in rural areas, and $845 in urban areas in 2002. Agriculture contributed 14 percent to China's GDP. China has a labor force of 740 million; the combined labor force for developed countries in Europe and North America is 430 million. China's labor force increases by 10 million a year.

Internal migrants in China are similar to international migrants, in the sense that their rights in cities are restricted. Although rights for migrants in cities are improving, most migrants have little recourse if their urban employers refuse to pay them, since the migrants are away from the place they are registered. Almost all government spending is confined to people registered in the place where services are provided, so that public housing, education and health care services are frequently not available to migrants.

In January 2003, China's State Council promised migrants "legal rights" to work in cities, proposed that employers could be punished for discriminating against workers on the basis of residency, and proposed an end to making some urban jobs off limits to workers not registered in the city.

Some provincial governments have begun to encourage migration to jobs. Anhui province, eight hours northwest of Shanghai and poor, has 63 million people in an area half the size of Texas. A government agency provides training for women to be maids, charging them 100 yuan or $12 if the agency finds the woman such a job. The Anhui government has employment offices in cities such as Shanghai to find jobs for provincial residents. There are about six million Anhui migrants outside the province, remitting an estimated 24 million yuan a year.

China's vegetable acreage doubled in the 1990s, and China now has 15 times more vegetable acreage than California. China is the world's largest producer of apples, 1.5 billion bushels, or half of the world's supply (the US produces about 215 million bushels a year). Many of China's apples are in the central and northeastern parts of the country, particularly in Shaanxi and Shandong Provinces, and are used to make apple concentrate, which is used to make apple juice. Rising yields and quality are expected to make China's apples more competitive on world markets.

India. India has minimum wages for farm workers that vary by state, from Rs 38 per day in Bihar to Rs 74 in Haryana, with adjustments if employers provide room and board. Actual wages are reported to range from Rs. 35 (Orissa ) to Rs 117 (Kerala) a day in 2002. Labor costs are a higher share of production costs in low-wage states-labor was reportedly 60 percent of the cost of growing paddy rice in Orissa, and 34 percent in the Punjab.

There were about 3.1 million Indians employed in the oil-exporting Gulf states in 2002, including 1.5 million in Saudi Arabia; 950,000 in the UAE (Dubai); and 300,000 in Oman. The Indian government estimates remittances at $14 billion in 2002.

Half of these migrants are from the southwestern state of Kerala--the Malappuram district has 750,000 returned migrants. However, unskilled Indians are being underbid by migrants from Bangladesh (1.8 million migrants in the Gulf), Pakistan (one million) and Sri Lanka (900,000). To upgrade skills and improve the wages of residents who want to work abroad, the Kerala state government is starting a program to try to make one person in every household computer literate.

During the peak of the Indian emigration boom in 2000, dowry prices rose sharply: one migrant married off his first daughter for 56 grams of gold and his third daughter for 136 grams. Dowry prices remain high, and family life has been changed by men living apart from their families for most of several decades.

There are about 20 million people of Indian origin abroad, including 2.2 million in the UK; 1.7 million each in the US and Malaysia; 850,000 in Canada; 700,000 in Mauritius; 500,000 in Trinidad and Tobago; 400,000 in Guyana; and 340,000 in Fiji. This diaspora has been very successful economically. There are about one billion Indians in India, but the 20 million abroad have incomes totaling $160 billion a year, a third of India's GDP. However, Indians abroad invest relatively little in India, some $0.5 billion, compared to $60 billion invested in China by 55 million overseas Chinese.

The first conference of the Indian diaspora organized by the Indian government was held in January 2003, where the government pledged to allow dual citizenship for Indians who naturalize in the United States, the United Kingdom, Australia, New Zealand, Canada and Singapore. Under current law, Indians lose their Indian citizenship when they naturalize abroad. About 60 percent of Indians in America are from the state of Gujarat.

Catfish. Catfish are a $500 million-a-year business in the US, with production concentrated in the Mississippi Delta. About 13,000 US workers are employed on US catfish farms, earning about $8 an hour. US farmers receive about $0.70 a pound for catfish, which is a flat-headed, scaleless bottom-feeder once called a river rat, while the Vietnamese sell their fish for $0.50 a pound.

US catfish farmers in 2002 charged that the Vietnamese are selling catfish in the US below their cost of production, and in January 2003, the US Commerce Department agreed, imposing tariffs of 40 to 60 percent on Vietnamese catfish imports. Vietnam sells more than $2 billion in catfish worldwide, making it one of the country's largest export items. Catfish farming employs between 300,000 and 400,000 people in the country's Mekong delta.

Vietnam, a country of 80 million, has been sending more migrants abroad: 20,000 in 1999; 25,000 in 2000; and 35,000 in 2001; with 50,000 migrants expected to be deployed in 2002 by 159 labor broker companies. The government estimates that, if it can deploy 500,000 workers abroad by 2005, Vietnam will receive $2 billion in remittances, an average $4,000 for each worker.



David Barboza, "Export Apple of China's Eye Is, er, Apple," New York Times, April 4, 2003.