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The haliya and kamaiya systems in Nepal are often labelled as modern forms of slavery, or simply as agricultural bonded labourers. The former exists among various caste/ethnic groups, including the Musahar people, while the latter primarily affects a section of the Tharu ethnicity. The Nepali government has outlawed both practices, but the haliya and kamaiya contract agreements have largely moved from adults to children. This empirical study presents an alternative perspective by taking into account of ethnic Musahar and Tharu children’s understanding of the negative and positive aspects of their daily life-worlds. In doing so, this paper shows a rather complex picture of bonded labour than the ones presented by various advocacy groups, and in particular, it echoes the voices of research participants that unless better alternatives are available, a completely abolitionist stance actually puts their immediate livelihood strategies in serious jeopardy.