Unorganized Enterprises and Rural-Urban Migration in India: The Case of the Cycle Rickshaw Sector in Delhi

Takashi Kurosaki, 卓 黒崎, Asit Banerji, S. N. Mishra and A. K. Mangal

No 28, PRIMCED Discussion Paper Series from Institute of Economic Research, Hitotsubashi University

Abstract: In 2010/11, we conducted a survey of cycle rickshaw pullers and rickshaw owners located throughout Delhi, India. We drew a sample of 132 rickshaw owners (called Thekedars) and a representative sample of 1,320 rickshaw pullers. The survey results show that most rickshaw pullers in Delhi are short-term, temporary migrants. Most rickshaw pullers are poorly educated. The majority migrated from villages in the states of Bihar and Uttar Pradesh. Social networks that extend from places of origin to final destinations facilitate migration. More than 90% of rickshaw pullers operate rental rickshaws owned by Thekedars. Rickshaw pulling involves hard physical labor. On average, a rickshaw puller works 11 hours per day, over 27 days per month. We estimate the average daily earning to be Rs. 260. A typical migrant rickshaw puller may save more than Rs. 2,000 per month. He may send these funds to his village home. This is the migrant rickshaw pullers’ contribution to rural poverty reduction. Thekedars provide the fulcrum upon which the whole cycle rickshaw transportation system of Delhi turns., In addition to the rental of cycle rickshaws to migrant rickshaw pullers, Thekedars manage the administrative and legal aspects of their rickshaw rental business throughout the year. Their occupational history shows that many of them became a Thekedar from low beginnings, including rickshaw pulling and rickshaw repair jobs. On average, a Thekedar owns 56 rickshaws, approximately two-thirds of which are rented on a daily basis. Pullers pay a fixed rental fee per day at an average rate of Rs. 34. Net of business expenditures, monthly rickshaw rental income per Thekedar is estimated at approximately Rs. 5,600 for small and medium Thekedars and Rs. 41,000 for large Thekedars. The internal rate of return on investment over 5-6 years of the working life of a rickshaw is estimated to range between 18% and 62% per year. Currently, the rules and regulations on t he cycle rickshaw sector in Delhi are based on the principal of the one-rickshaw, one-owner, one-driver, one-license policy. However, this policy does not reflect the real-life situations we encountered in our survey. We recommend that Thekedars be endowed with legal entity status. This would result in the healthy development of urban transport in Delhi.

Pages: 54 pages
Date: 2012-07
New Economics Papers: this item is included in nep-mig
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