CAPITALISM IN INDIAN AGRICULTURE

 

Practice  Question  – Comment on the factors responsible for the growth and consolidation of middle level peasantry in rural India. How is it related to capitalism in Indian agriculture?      [UPSC 2011]

Approach – Introduction, What led to the rise and strengthening of middle level peasantry in rural India?, Establish rise of middle level peasanty to the emergence of capitalism in India, Illustrate your answer with thinkers and examples. 

 

INTRODUCTION

The development policies of most of the developing countries have been premised on the conceptual framework that conceives development as a process of structural transformation from predominantly rural, agrarian and subsistence economies to predominantly urban, industrial and capitalist economies. In such a capitalist development process, agriculture is also being industrialised with the help of capital-intensive technology. While the industrialised agriculture can potentially augment the level of agricultural production, but at the same time would result in “an increase in the ratio of capital stock to land” and thus “the livelihood outcomes of this process are, for many in the countryside, negative, as market imperatives and profitability requirements undermine the capacities of many small-scale farmers to compete on domestic markets”.

 

AGRARIAN CLASSES IN INDIA

Capitalist Agrarian Class Structure

The question of the development of capitalism in Indian agriculture has been one of the prime site of contention or debate among Indian scholars. Ashok Rudra and Utsa Patnaik are the social scientists whose writings have generated a debate on whether Indian agriculture has capitalist class relations. 

Ashok Rudra (1978b) states that contrary to the general tendency of dividing the farmers in three categories – small, middle and big, there are only two classes in Indian agriculture:
i) big landowners and
ii) agricultural labourers

This means that there is a class of agricultural capitalists (big landowners) and a class of agricultural labourers and wage workers. The capitalists belong to the
ruling class. They rule over the rest in agriculture. Another feature which is referred to as a distinct characteristic to define class relations in Indian agriculture as capitalist by Ashok Rudra is the accumulation of productive capital through reinvestment of the surplus appropriated by the owners of the means of production. Generation and appropriation of surplus is a characteristic of every society based on private property. The generation and the utilisation of the surplus differs in different systems. The feudal appropriator typically utilises the surplus for purposes of consumption. The surplus supports his/her excesses in luxury. Contrary to this, the capitalist appropriator typically utilises the surplus for re-investment with a view to expanding reproduction which, is a means to the end of continuously expanding the volume of profit. The typical pattern of capitalist production is ever-expanding reproduction the consequence of relentless pursuit of profit.

Utsa Patnaik while distinguishing between the exploiting classes (landlords and rich peasants) and the exploited classes (poor peasants and labourers), further specifies
two different divisions on the basis of the predominant form of exploitation i.e. wages or rent.  She uses two criteria to define these economic classes: possession of the means
of production, and the exploitation of labour. She says that in agriculture, such as, in India, the two poles are readily identified: the landless and near landless who possess no or little means of production. They are mainly or wholly dependent on working for others. The land-lords and capitalists concentrate sufficient means of production. They do not labour themselves but live on employing others. 

 

Non-Capitalist Agrarian Structure in India

Instead of using pre-capitalist expression we are using the expression non-capitalist to highlight the fact that those who argue for semi-feudal or semi-feudal semi-colonial modes of production do not deny the thesis that capitalism has made headway in Indian agriculture and its class formations which is self evident in the use of the word ‘semi’. The expression pre-capitalist does not highlight the impact of capitalism. The non-capitalist positions imply that India has witnessed limited and distorted development of capitalism.

The first eminent scholar to speak of semi-feudal is Amit Bhaduri. On the basis of a survey which he had conducted in the year 1970 in 26 villages of West Bengal, he concluded that “the dominant character of existing production relations in these villages can be best described as ‘semi-feudal’. He says that the term ‘semi-feudalism’ means that “the existing relations of production have more in common with classic feudalism of the master-serf type i.e. the European relation of the Landlord and the serfs. relations than with industrial capitalism.”  He listed four prominent features of these semi-feudal relations: share-cropping; perpetual indebtedness of the small tenants; concentration of two modes of exploitation, namely
usury and land ownership in the hands of the same economic class; and lack of accessibility to the market for the small tenant.

According to Bhaduri, kishan is almost always heavily indebted. “A substantial portion of the kishan’s legal share of the harvest is taken away immediately after the harvest as repayment of past debt with interest, thus reducing his actual available balance of the harvest well below his legal share of the harvest. This does not usually leave the kishan with enough food to
survive from this harvest to the next and the serious problem of survival from harvest to harvest can only be overcome by borrowing for consumption. This perpetuates the indebtedness of the kishan based on his regular requirements of consumption-loans.

Pradhan Prasad makes a sharp distinction between the middle peasants, whose landholdings have increased and whose overall economic position has become stronger over the past thirty years, and the top peasants. There is a conflicting relationship between the ‘rising’ middle castes and the ‘traditionally dominant’ top peasants consisting of upper castes. He also speaks of an ‘emerging contradiction’ between the ‘landlords, cultivators and big peasantry on the one side and the poor peasantry on the other’. This antagonistic relationship arises
out of semi-feudal ‘bondage’. He predicts the disintegration of the semi-feudal set-up to be replaced by ‘another contradiction between new upper caste Hindu kulaks and the poor peasantry’. He also predicts that the landlords and big peasants will forswear their earlier resistance to modernisation and ‘will take steps to dynamicise their cultivation.  

 

TECHNOLOGICAL DEVELOPMENT AND AGRICULTURE

Technological advancement has had an effect on the agrarian relations. The introduction of irrigation, seed technology, high yielding varieties, green revolution, introduction of chemical fertilizers in the place of organic fertilizers, introduction of tractors and tillers in the place of bullockcarts etc. has helped in the growth of agrarian capitalism in different countries. The weak agrarian capitalism in the third world has not been able to pose challenges to the Western countries . Nonetheless introduction of agrarian capitalism has given rise to new categories to emerge. In Russia it has given rise to Kulaks, which acted as a reactionary force and also gave spaces to agricultural labourers. In India it has given rise to bullock capitalist or gentleman farmers or Maliks. At the same time it has had other effects too: A class of agricultural labourers have been able to demand more wages, fixing of working hours, medical and maternal facilities etc. In other words agrarian capitalism has increased the bargaining capacity of the agricultural labourers as well as the capitalist peasants both at the grassroot level as well as national and international levels.

 

INDIAN PATH OF CAPITALIST AGRICULTURAL PRODUCTION

India’s path of capitalist development is perhaps distinct in five aspects. First of all, India took to liberal political democracy, even before any substantial capitalism developed as in classical Western capitalist countries. A liberal democracy in polity, without a bourgeoisie revolution, without adequate capitalist development in the economy, is perhaps unique to India. The second important feature is that India’s capitalist development is spearheaded by the state through forcible mobilisation of small savings. The capitalist accumulation in the modern sector more or less predominantly funded by savings from within the sector and agrarian surplus did not play any leading role in the process. Nevertheless, agrarian sector retains its importance as being a major buyer of commodities of the modern sector and supplier of food and non-food commodities to the rest of the economy.

The third aspect is concerned with state of technological conditions of development. India’s entry into capitalist path of development took place in the post-War world, when highly capital intensive condition of production had already become the norm. The modern capitalist sector requires very little labour. Hence, there is no way the surplus labour in agriculture would ever be absorbed in the modern sector, including the service sector, as contemplated by Sir Arthur Lewis. On the top of it, given the demographic transition and the population rate acceleration during 1950-80, there has been a considerable expansion of surplus rural population, and the rural sector cannot absorb this growing labour force. The push and pull factors have contributed to increased urban migration.

The fourth aspect is, even though primitive accumulation in agriculture is blunted in certain ways, it does not mean such a process is absent fully. The state facilitated primitive accumulation process, displacing people for construction of dams, public sector units and mining through land acquisition laws. Since the scale of acquisition had been relatively low, the primitive accumulation process, understood as one that would dispossess the peasants of their means of subsistence, has remained relatively marginal. The fifth aspect is politics and pressure in public policy. Various social movements such as dalit movement, women’s movement, anti-dam movements, anti-corruption movement, have added new dimensions of politics to public policy. It would be incorrect to ignore the contribution of these social movements to the politics of self-assertion. Another example would be recent farmers protests raged in Delhi. 

 

CONCLUSION

The growing number of small and marginal farmers –self-exploiting subsistence ‘petty producers in a thriving capitalist system is perhaps the paradox to stay here for a long time to come. This is a result of a range of historical, political and economic factors that have shaped the trajectory of Indian development process. The present capitalist system has no capacity
to transform this non-capitalist sector or absorb its dependents. Capitalist sector uses agricultural sector to produce foodgrains and raw materials, managed by the tiny subsistence producers; who are systematically pauperised in the exchange. 

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