This first chapter in the section on agriculture is devoted joa discussion of the following issues: =a «Role of agriculture in Indian economy «Nature of India’s agriculture : Cropping pattern in India and the factors determining this cropping pattern, a /ROLE OF AGRICULTURE IN LINDIAN|ECONOMY) oo Indian agriculture had reached the stage of development nd maturity much before the now advanced countries of the world embarked on the path of progress. At that time, there was a proper balance between agriculture and industry and both flourished hand-in-hand. This situation continued til the middle of the eighteenth century. The interference from the alien British government and its deliberate policy af trotling the village handicrafts and cottage industries destroyed the fibre of balance and the economy of the country was badly shattered. Britishers pursued a typical colonial policy in India and did nothing to develop (or restore) agriculture. Instead, they created a class of intermediaries known as zamindars who sucked the very blood out of the rural poor. A substantial part of the produce vastaken away by this parasitic class and the actual cultivator vas let only with subsistence income. The cultivators had titer the resources nor the incentive to invest in agriculture, Therefore, Indian agriculture in the pre-Independence period canbe correctly described as a ‘subsistence’ oceupation. It ‘as only after the advent of planning (and more precisely alter the advent of green revolution in 1966) that some i Started adopting agriculture on @ commercial basis. snow discuss the role of agriculture in Indian economy. Vl Share in national income. At the time ofthe First World War, agriculture contributed two-thirds of national att: This was on account of the practical non-existence fps development and infrastructure, However after fog aston of planning in India, the share of agriculture tg Pesbtetly dectined on account of the development of E and tertiary sectors of the economy: Secon in 1950-51, the share of agriculture and allied Bs INDIAN AGRICULTURE: ROLE, ATURE AND CROPPING PATTERN activities (includes agriculture, forestry and logging and fishing) in GDP at factor cost declined to 29.6 per cent in 1990.91 and further to 13.9 per cent in 2013-14 (at 2004- 05 prices). ‘The share of agriculture in national income is often taken as an indicator of economic development. Normally developed economies are less dependent on agriculture as compared to underdeveloped countries. For example, only 2 per cent of GDP is derived from agriculture in the USA and UK. Thus, it seems that as the country progresses, the dependence on agriculture declines." 2, Largest employment providing sector. In 1972- 73, 73.9 per cent of the working population was engaged in agriculture and allied activities. This percentage fell to 64.8 per cent in 1993-94 and 48.9 per cent in 2011-12. During the period 2009-12, agriculture provided employment to 43 per cent of the male workers and 60 per cent of the female workers. With rapid inerease in population, the absolute number of people engaged in agriculture has become exceedingly large. Development of the other sectors of the ‘economy has not been sufficient to provide employment to the increasing additions to working population who are, therefore, forced to fall back upon agriculture even if their marginal productivity on land is zero or nearly so. This gives rise to the familiar problem of underemployment and disguised unemployment. Most of the underdeveloped countries exhibit this heavy dependence of working population on agriculture. For example, 36 per cent of the male workers and 75 per cent of the female workers were employed in agriculture in Pakistan during the period 2009-12. For Liberia, this percentage was 50 and 48 respectively during 2009-12. As against this, the percentage of economically active population engaged in agriculture is very much less in developed countries. For example, in Japan and France 4 per cent, and in USA and UK only 2 per cent of the male workers were engaged in agriculture during 2009-12, 3, Provision of food surplus to the expanding population. Because of the heavy pressure of population in Tabour-surplus economies like India and its rapid increase, the demand for food increases at a fast rate. The existing tevels of food consumption in these countries are very low Scanned with CamScannera Indian Economy 230 and with a little increase in per capita income, the demand for food rises steeply (in other words, it can be stated that the income elasticity of demand for food is very high in developing countries). Therefore, unless agriculture is able to continuously increase its marketed surplus of foodgrains, 1 crisis is likely to emerge. Many developing countries are passing through this phase and, in a bid to meet the increasing food requirements, have been compelled to import large quantities of foodgrains. 4. Contribution to capital formation. There is general agreement on the importance of capital formation in economic development. Unless the rate of capital formation increases to a sufficiently high degree, economic development cannot be achieved. Since agriculture happens to be the largest industry in developing countries like India, it can, and must, play an important role in pushing up the rate of capital formation, If it fails to do so, the whole process of economic development will suffer a setback. To extract surplus from agriculture, the policies advocated are: (i) transfer of labour and capital from farm to non-farm activities; (i) taxation of agriculture in such a way that the burden on agriculture is greater than the governmental services provided to agriculture; and (iii) turning the terms of trade against agriculture by imposing price controls on agricultural products, taxation or the use of multiple exchange rates that discriminate against agriculture. The implementation of these policy ‘measures in the developing countries is, however, a difficult task. Therefore, generation of surplus from agriculture will ultimately depend on increasing the agricultural productivity considerably.2 5. Providing raw materials to industries. Agriculture provides raw materials to various industries of national importance, Sugar industry, jute industry, cotton textile industry, vanaspati industry are examples of some such industries which depend on agriculture for their development. The entire range of food processing industries is similarly dependent on agriculture. Therefore, unless agriculture develops, these industries wall also remain backward. 6, Market for industrial products. Since more than two thirds of the population of developing countries like India lives in rural areas, increased rural purchasing power is a valuable stimulus to industrial development. This point (was emphatically brought home by Ragnar Nurkse when he stated, “The trouble is this: there is not a sufficient market for manufactured goods in a country where peasants, farm ero es eels, comprising typically two-thirds -f Population are too poor to buy any Fetory products, or anything in addition to the little they oes anita is lack of real purchasing power, ee are enerraivity in agriculture.” Therefore, to expand agricultural output and productivity, the income of the rural sector yi Causing, in turn, an increased demand for indus, My and the proces of industrial development yi gute a boost up. WO tie In nia, with the spread of Green Revolution and more areas in recent years (Particularly durina ® ie three decades), incomes of large farmers have pp considerably whereas their {2x liabilities are ngy¥% This has increased their purchasing power supe with the result that the demand for industrial goggg "ly rural markets is witnessing a marked increase, The eq" sector is very well aware of this rising demang reorienting its marketing strategy and production pa tap this large market. Manufacturers of household i (particularly items of daily use Tike ta, soaps, deter clothes, cycles, scooters, radios and transistors, teleigg’ etc.) are vying with each other t0 get as large a chink this market as possible. In fact, many multinaiony corporations planning to enter the Indian market (hank g the ‘liberal’ economic polices of the Goverament of ings since 1991) have an eye on this expanding market 7. Importance in international trade. For a nun, of years the three agriculture-based exports of India cotton textiles, jute and tea — accounted for more than 5p per cent of export earnings of the country. If we add the export of other agricultural commodities like cashew kemels tobacco, coffee, vanaspati oil, sugar, etc., the share of agriculture in total exports rose to around 70 to 75 per cen. Such heavy dependence on agricultural commodities for export earings reflected the underdeveloped nature ofthe economy. With economic progress and consequent diversification of production base, the share of agricultural goods in total exports has consistently fallen. For instance, the share of agricultural exports in total exports was 442 per cent in 1960-61. This fell considerably to 30.7 per cet in 1980-81 and 13.6 per cent in 2013-14, As far as composition of imports is concerned, capital goods, indus machinery, petroleum and petroleum products and maintenance imports have accounted for the bulk of imports However, during certain years, the country had to fice severe drought conditions and large-scale imports of foodgrains had to be resorted to India also imports day products, fruits, vegetables, animal and vegetable oils and raw materials. 8. Role in poverty reduction. As stated * agriculture presently contributes less than 15 pet om India’s GDP yet it continues to employ more than half of" workforce. Moreover, an average Indian still etme’ spend almost half of his/her expenditure on {00 * agriculture continues to a source of livelihood 3” To security fora vast majority of low income, poor and vile! and ig ove, Scanned with CamScanner |Fr cons ofthe society is role in poverty reduction ise In fact, the experience of B, ion is se ae ia)sthdlcates that's Tie (Braclt, Russia, Ind tare isa least 039 10 three times move cfc ‘ing poverty than the same grow effective in Cas ie Same growth emanatin, agricultural sectors.’ Given that India is stil tae notarest number of poor and malnourished people ite it ida higher priority to agriculture will achieve the g ‘a wmcing poverty and malnutrition as well ac achicrns joclusive growth. i ‘The above discussion brings out clea importance of agriculture in the Gaia wen wPrjopment of agriculture is a virtual precondition ct xroral diversification and hence of development itself ing surplus of agricultural produce is needed in ii omy 1: () increase supplies of food and agricultural ‘aw materials at non-inflationary prices; (i) widen the domestic market for industrial goods through increased purchasing power within the rural sector; (i) facilitate imersectoral transfers of capital needed for industrial development (including infrastructure); and (iv) increase {foreign exchange earnings through agricultural exports.> ‘Moreover, as stated above, growth in the agricultural sector js crucial for reducing poverty and malnutrition. As stated inthe State of Indian Agriculture 2011-12 Report, achieving 9 per cent rate of growth in overall GDP may not deliver much in terms of poverty reduction unless ‘agricultural’ growth accelerates. At the same time, ‘growth with inclusiveness’ can be achieved only when agricultural growth accelerates and is also widely shared among people and regions of the country. Thus, we may conclude that “agriculture has to be Kept at the centre of any reforms agenda or planning process, in order to make a significant denton poverty and malnutrition, and to ensure long-term food security for the poor”.° In 'dian Agriculur achieving NATURE OF INDIA’S AGRICULTURE i At the time of Independence, India’s agriculture was ina state of backwardness. Productivity Per hectare and per Worker was extremely low. The techniques employed were ‘ge-old and traditional. Because of low productivity, ‘griculture merely provided ‘subsistence’ t0 fhe earners ‘0d had not become ‘commercialised’. Approximately 45 Fetcent ofthe total consumption of farmers came from their vn production in 1951-52. This highlights the low importance of money in the village economy. All the factor ‘scrbed above when taken together describe the nati |hda’s agriculture. They reveal that Indian agriculture backward and qualitatively traditional in nauure Me ov of the First Five Year Plan. Howeves ig not e: Role, Nature ‘and Cropping sufficient to call Indian agriculture backward and stagnant and leave the discussionthere. Wen the causes responsible for this state of aff can be carried out by examining the land holdings, agricultural techniques. This exercise relations, size of irrigation facilities, widespread rural indebtedness, role of moneylenders in rural economy, etc. Let us examine these causes in some detail 1. Feudal relations of production. At the time of Independence, three types of land tenure system were prevalent in the country — zamindari, mahalwari and ryotwari, Approximately 57 per cent area of the country was under the zamindari system. In terms of coverage, syotwari came second with 38 per cent area, while mahalwari was restricted to only 5 per cent area. The zamindari system was based on exploitation since zamindars pressurized Peasants in a variety of ways with the objective of extracting ‘as much rent from them as possible, As we shall discuss in the chapter on ‘Land Reforms’, the zamindari system was a major hindrance to agricultural development. Ryots in the ryotwari system also leased out their land to tenants for cultivation and these tenants were also subjected to the same type of exploitation as prevalent under the zamindari system. ‘After Independence, the State governments enacted laws to abolish the intermediaries. However, these were entirely inadequate to have any drastic impact on the agrarian structure. The zamindars only changed their garb and became absentee landlords. Obviously, the classes that are exploited by these landlords are the classes of tenants and agricultural workers. Though no exact estimates on tenancy are available, ithas been estimated that around 50 per cent of the cultivated Jand is under written or oral tenancy. A large number of tenants come under the category of tenants-at-will and sub- tenants. These classes of tenants possess no security of tenure and enjoy cultivation rights only so long as the Jandlords allow them to do so. This exposes them to the exploitative practices of the landlords since their very existence hinges on the pleasure of the landlords. ‘The second exploited class is constituted of agricultural workers. This class is at the lowest rung of social ladder in Tural areas. It can be divided into two categories {i attached Tabourers, and (i) casual labourers. The forme: age attached to some cultivator household on the basis of 2 viitien or oral contract, Normally, they are not fee to work rany other place. AS against this, casual labourers are free work on the farm of any farmer, A large number of tenants have also been evicted under the guise of persona! cultivation’ and have swelled the ranks of agricultural Tubourers. The growing mumber of agricultural labourers Fpatoates the process of “immisersation’ ofthe rural poor. Scanned with CamScannerIndian Economy 2. Usurious capital and rural indebtedness. The capital is very strong on the Indian control of usurious f 1 common legacy of poor agriculture and indebtedness farmers. During the pre-Independence period, money- lenders and mahajans ruled the roost as there was no other credit agency worth the name, Taking advantage of their position, these people exploited the farmers in a number of ways. After Independence, the government has initiated number of steps to curb their activities — the most important sure being the development of cooperative credit institutions and thé reasing participation of banks in providing rural credit. However, because of a number of factors, the small and marginal farmers continue to depend ‘on moneylenders for fulfilling their credit requirements to a large extent and thus become victims of exploitation by the latter, The phrase ‘once in debt, always in debt” expresses the condition of these farmers graphically. The moneylenders charge exorbitant rates of interest, manipulate accounts to theiradvantage and often seize the land of small and marginal farmers on one pretext or the other. This usurious capital and rural indebtedness in India is a result of the social system or the relations of production prevailing in agriculture. Since long the Indian peasant has been living the life of bonded land-slave. It is this wretched existence that is responsible for his economic bankruptcy and consequently for his continued indebtedness. 3. Labour market dualism. Because of the excessive pressure of population on land, wages in the agricultural sector fend to be considerably lower as compared to the modern (industrial) sector. This leads to a labour market dualism. This dualism is explained by the fact that large ‘number of workers remain sticking to traditional agriculture despite low wage due either to ignorance of better opportunities outside agriculture, or to their inability to obtain a moder sector job despite wishing to do so, or to the cost of moving being unacceptably high (including the cost of giving up the relative security of remaining at home) in relation to the expected wage premium. Low wages in the ‘agricultural sector lead to low per capita income and this, in turn, results in low labour productivity, ” energy (human and animal labour), rains and dung Se eae under this technique of broducian ery meagre and the nature of farming is appr described as ‘subsistence farming’. However, with th ofthe new agricultural strategy in 1966, modern teh of production were initiated in certain selected regi the county like Punjab, Haryana and Western Uta Pag {As a consequence ofthe adoption of modern techni production and new high-yielding varieties of yoo” agricultural productivity registered substantial inereaga these areas, However, since large areas ofthe country conn to use outmoded agricultural techniques, a so;x technological dualism has emerged in the country, 5, Fluctuations and instability in crop output, Th, Indian agriculture has rightly been called a ‘gambie jy monsoons’. Gross cropped area in 1950-51 was 131,99 million hectares, whereas gross irrigated atea was only 22.56 million hectares. Thus, only 17.1 per cent of gross cropped area had irrigation facilities. In 2011-12, the gros, cropped area was 195.25 million hectares of which 91.53 million hectares was irrigated. Thus, 46.9 per cent of gross cropped area had irrigation facilities in 2011-12. This shows that even now approximately 53 per cent of gross cropped area continues to depend on rainfall. Therefore, nature continues to play a major role in determining the level of agricultural production. If anything, the use of biochemical technology in the post-1965 period (often known as High Yielding Varieties Programme) has increased the sensitivity of output (except wheat) to variations in rainfall. However, according to CH. Hanumantha Rao, the increase in instability is not due to new technology but arises from the adverse agro-climatic conditions in which the technology is used. ‘The new technology has raised the ‘response’ of output o Water. AS a result, for a given variability in rainfall or moisture conditions, the instability in output would be Breater.” According to Economic Survey, 2006-01, there He coldest rainfall’ in 2002, 2004 and 2006 during the in period and this led to: (1) poor agricultural Growth, (2) reduction in the share of agriculture in GDP, ©) creating inflationary pressure in some primary products, and (4) reduction in the potential growth of other sectors by dampening demand.'° For example, the production of foodgrains which had touched the level of 212.9 milli fonnes in 2001-02, fell to 174.8 million tonnes in 2002-03. Again, after rising to the record level of 213.2 millon eee it fell to 198.4 million tonnes in pe Bees ae ae Tose to 234.4 million ieee i 210-11, gage © 21841 millon tonnes in 2009. a tion sean {086.10 244.5 million tonnes Foal pie " cae, 257.1 million tonnes in 2012-13 level of 264.8 million tonnes in 20! Scanned with CamScannerIn «6 Diversities in the agricultural se, of generalisation. India is a obi al agricultural diversities Diener aie different characteristics so that no one niet ent ved forall agricultural regions of he nce Be Soatre of Soil the magnitude of rainfall, avaiabtity ot Mier, et differ considerably between different repion, Var insane, take the case of rainfall. White: Weg FM than anda part ofthe Thar desert have avery unsotarn Mini of 4 t0 5 inches a year, Cherrapunji in Assam has oy sal rainfall of more than 450 inches. While eonsidenitie tims face drought conditions in a particular year, cong Meas encounter the fury of floods. Some areas face the problems of waterlogging and sanity. Practically the ent falivated area of the country suffers from deficiency of titrogen. Elements of phosphates and potash also differ significantly in different areas. It is not infrequent to find plots of land of highly different productivity existing side- ide in a particular village. Not only this, relations of production are different in different States. There are {ubstantial regional inequalities also in regard to subdivision nd fragmentation of holdings. ‘The presence of large diversities in the agricultural sector makes it necessary to devise separate agricultural policies for different regions. It is not possible to generalise {iv formulate a single agricultural policy for the nation as a whole as such generalisation is bound to gloss over inter- regional. differences and fail to deliver the goods, ctor and the large country having oS CROPPING PATTERN IN INDIA By crop pattern, we mean the proportion of area ander different crops at a point of time, changes in this distribution over a period of time, and factors determining this change in distribution. Cropping pattern in India is dktermined mainly by natural factors like rainfall, climate ad soil conditions. However, technological factors have also played an important part. For example, consequent won the adoption of the new seed-fertiliser technology (generally known as the High Yielding Varieties Programme) inthe mid-1960s, area under wheat increased significantly. In recent years, the government introduced various ogrammes for increasing the production of oilseeds. As Fest, area under oilseeds increased rapidly. Significant fs about the cropping pattern in India are summarised below: 1, Food crops including cereals, millets, pulses, ables and fruits cover nearly three-fourths of total d area. Of the total area under foodgrains, large is occupied by cereals. For instance in 1950-51, of total area of 97.3 million hectares under foodgrains dian Agric fulture: Role, N 233 lature and Cro ‘ing 8 much as 782 million hectares (representing 89.4 Po s. OF the total area of 126 013-14, the share of was 100.8 milion hectares (i, 80.0 pet cen). This shows thatthe area under pulses was only about 20 per e [practice adopted the land cultivated by tenants. me Ce. Tenants, themselves, were of, the followir : : following three ose f) Occupancy tenants.(2) Tenantsatevill, and ee nants. Occupancy tenants enjoyed permanent and le rights on land. They had security of tenure and could claim compensation from the landlord for a, improvement effected on the Jand. As against this, tenants. atuvll did not have security of tenure and could be evicrg from land whenever the landlord so desired. The positon of tenants was also similar. The only difference betyeey sul will was that, whereas the latter were them and tenants appointed by the landlords themselves, sub-tenants. were appointed by the occupancy tenants. In addition to these classes of people, a big class of agricultural labourers existed side-by-side. These people had no land whatsoever and worked on the land of others on wages Zamindari System This system was created by the East India Company when in 1793, Lord Cornwallis entered into ‘permanent settlement’ with landlords with a view to increasing the revenue ofthe company. Under the settlement, the landlords, (known as zamindars) were declared full proprietors of large areas of land. In return, the task of collecting rent from the farmers was entrusted to them. Thus, the zamindars were to function as intermediaries between the cultivators and the State. The share of the government in total rent collected by the zamindars was kept at 10/1 1th, the balance going to the zamindars as remuneration. At the time of Independence, this system was prevalent in West Bengal, Bihar, Orissa, Uttar Pradesh, Andhra Pradesh and Madhya Pradesh. The zamindari system suffered from a number of defects. It created a unique agrarian structure in the countryside which conferred the right of sharing the produce of land without participating personally in the productive process. The system itself was based on exploitation # conferred unlimited rights on the zamindars to extract # much rent as they wished. According to Bhawani S approximately 25 per cent of the produce was taken 23! by the intermediaries in the form of rent. This would mes! that out of the income of € 4,800 crore from agricultur 1949-50, the share of intermediaries was as high as © 17 crore. The grabbing of such a high proportion of income bY € parasitic class was not only socially unjust but also hth detrimental to capital formation and economic develoo™®"™ Scanned with CamScannerathe actual cultivator was ten wi ee ae Beet tr ea © en tras there any incentive for him Wo increse crate mivction and productivity, Thus, according Thome Ppuiltin ‘depressor’ continued to eters perate in the countryside characterised by low capital intensity and antiquated mete antiquated methods se tllers showed no interest ine a sat aniston force Consequently, agricultural production voae yeemetation from the 1880s t0 the 1940s it rose vo shay Cows amd fe virtual stagnation? Se $0 slowly as to amount Not only this. The records of righ owematically maintained. in rpoet i Ht were no land. As a result, credit institutions were slow to hen zamindati areas. Public investments in amicdtne on aaa ca ne neem Agetas ee rr enn rade to pay to gain access to these.“ In addition to excessive rents and illegal exactions, the zamindars forced peasants to do begar and offer various gift/nazrana.cic Mahalwari System This system was introduced by William Bentinck in ‘Agra and Oudh. It was later extended to Madhya Pradesh and Punjab. In this system, the whole village was treated as a unit as far as payment of land revenue is concerned. The responsibility for collecting the land revenue and depositing itinthe treasury was of the village headman (or a co-sharer appointed for the purpose). According to the Congress Land Reforms Committee, the ownership of land under this system was collective. Period of ‘settlement’, fixation of land revenue, etc., were different in different mahalwari areas, Ryotwari System This system was initially introduced in Tamil Nadu and was later extended to Maharashtra, Barar, East Punjab, ‘Assam and Coorg. Under this system, the responsibility of paying land revenue to the government was of the cultivator (or individual ryot) himself and there was no intermediary between him and the State. The ryot had full rights regarding sale, transfer and leasing of land and could not be evicted ffom the land as long as he paid the land revenue. These rights were not available to cultivators under the zamindari ‘system. The settlement of land revenue under the ryotwarl system was done on a temporary basis. In Madhya Pradesh, such temporary settlement was done after every 20 years, in Bombay (Maharashtra) after every 30 years and in Madras (Tamil Nadu) and United Provinces (Uttar Pradesh) after Svety 40 years. Land Reforms Though the ryotwari system appears SatisTACTOry the face of it, yet it also developed various snags. In these ‘areas, moneylenders and mahajans granted loans tocultivators by mortgaging their lands, Soon substantial portions of land slipped out of cultivators’ hold and became the property of moneylenders and mahajans, The latter started giving land for cultivation on lease and soon a new zamindar class (with all its exploitative practices) started developing beginning of the era of Independence at least one-fi the total area under cultivation even in ryotwari tracts had passed under open tenancy while an unknown, though substantial, proportion of area was worked under forms of crops sharing, in essence no different from tenancy > iN, ap ea ene eS OBJECTIVES OF LAND REFORMS {As stated above, the zamindari system was based on exploitation. It created parasitic class of zamindars which — did not do any work on land but snatched away whatever surplus above the minimum subsistence the cultivators produced. The latter were forced to lead a wretched life of slavery-and deprivation, Under the ryotwari and mabalwari systems also, the practice of cultivation by tenants became widely prevalent. These tenants were also exploited in & number of ways. Particularly miserable was the condition of tenants-at-will and subctenants It was basically to stop the exploitation of the actual tillers of the soil and pass on the ownership of land to them that land reforms were introduced in the post-Independence' period in India, The government defined the objectives of | and reforms as follows: = Ra ( t0 remove such impediments t0 increase in ‘agricultural production as arise from the agrarian structure inherited from the past; and to eliminate all forms of exploitation and social injustice within the agrarian system, to provide security for the tiller of soil and assure equality of status and opportunity to all sections of the rural population® Measures contemplated to achieve these objectives ‘were as given below: a / Npolition of Intermediaries YL Tenancy Reforms 36 Reorganisation of Aerie Reforms included th A vulture. ¢ following set of ‘Tenane spesbires: (i) Regulation of Rent (i) Seeunty of es: 5 eee : and (i) Ownership Rights for Test ion ff Land, (i) Consolidation of Holdings, ‘and (iti) Cooperative Farming. Scanned with CamScannerIndian Economy ABOLITION OF INTERMEDIARIE! Even before Independence it was widely recognised that the main cause of stagnation in the economy was the stagnation in the agricultural sector and this stagnation could, toa large extent, be attributed to exploitative agrarian relations, The chief instrument of exploitation was. the zamindar, patronised and promoted by the alien gevernment, \\ was on account of this reason that not only was the desirability of bringing about changes in agrarian relations accepted but was also adopted as a kingpin of land reform policy Approximately 57 per cent area of the country was under the zamindari system on the eve of Independence. In some States, legislations were passed for their abolition before 1951. However, most of the work relating to enactment of laws and acquisition of areas was carried out during the period of the First Five Year Plan. In temporary settled areas like Uttar Pradesh and Madhya Pradesh, the task was relatively easy, since adequate land records and administrative machinery already existed. However, in permanently settled areas, such as Bihar, Orissa and West Bengal and in areas under jagirdari settlements, such as Rajasthan and Saurashtra, land records and administrative machinery had to be built up almost from a scratch. Even then, the official documents claimed that intermediaries were completely abolished by the end of the First Plan excepting a few small pockets in some areas of the country. It has been estimated that in all 173 millionacres of land was acquired from the intermediaries and, as a consequence, about two crore tenants were brought into direct relationship with the State Assessment of Zamindari Abolition The process of initiating, debating, amending and finally passing the bill for zamindari abolition mostly took a very long time. For example, in Uttar Pradesh, the Zamindari Abolition Act took four-and-a-half years to become law. However, it goes to the credit of the government that most of the States had passed such Acts before the end of the First Five Year Plan, This possibly reflected the popular sentiment against the zamindars and their exploitative Practices. Once the stage of legislation was completed and the stage of implementation started, fresh difficulties had to be faced. Zamindars were not willing to lay down their rights and privileges and tured to courts, As was to be expected, the legal battle between the zamindars and the State governments took an unduly long time. When the zamindars ultimately lost the battle they turned to other delaying tactics by refusing to hand over land records and other related documents. These delaying tactics apart, even the legi enacted were full of flaws and the zamnindars soe lin up the ‘holes’ in these legislations. Pethaps the ‘hole’ was the one pertaining to the permission y, land for “personal cultivation’. The zammindars coy,” evict tenants for this purpose. ‘Personal cultvatign, defined loosely 10 include personal supervision py e zamindar or members of his family. ‘The policy jig ™ in the First Plan was that zamindars could assure jg.” personal cultivation up to the ceiling limit and tenant, acquire permanent and heritable rights in land only ov. above the ceiling limit. With a view to bringing :p.% uniformity in the definition of personal cultivation as adopny in different States, the Second Five Year Plan specified tn, personal cultivation should have three elements: (i) risk og cultivation, (if) personal supervision, and (ii) labour. Though the official documents claim that zamindar has been completely abolished, yet the fact is that it has only changed its ‘garb’. The previous zamindars have acquired large areas for personal cultivation on which cultivation is done with the help of hired agricultural labour They are now designated as ‘big landowners’ and along with the rich peasantry, have formed “a new and dominant class of rural capitalists.” In the States where a ceiling has been fixed as to the amount of land a former zamindarc hold, the ceiling has been kept so high that very few zamindars have been affected. Flaws in the legislation have also enabled them to transfer their land to other members of their families and thus escape the ceiling law. For example, Daniel Thorner found that in post-reform Bihar, there existed estates of 500, 700 or even 1,000 acres and the older structure of landowner, occupancy raiyat, non-occupancy raiyat, under raiyat, and bataidar (cropsharer) continued even after the so-called zamindari abolition, Bihar remained a stronghold of large landholders and hierarchical property rights, wie “leasing, sub-leasing and evictions are all common.”* Despite these observations, there is no denying the fact that after Independence, exploitation and oppression of fenants and actual tillers of the soil has declined steeply 4% the feudal rural structure has crumbled down, As a result of abolition of intermediaries, the top layer of great absentee landlords has been skimmed off. Particular referen a Gontext has to be made of the land reform measures intite by the communist governments in Kerala (in 1959) #8 West Bengal (in 1967), In Kerala, the government declan eviction illegal within 48 hours of assuming office, More the share-croppers were granted the right to purchase M- ‘The zamindar was not allowed to retain more than 10 a of for personal cultivation. The United Front Gover | West Bengal acted decisively in favour ofthe bargadtts 2 agricultural workers and against landlords and rich Scanned with CamScanner taeLand Reforms in excess of ceilings (whether bena sand in excess es her benami or otherwise) LAN gentified and stributed among the peasantry the way of share-croppers 10 secure their land as formally recognised: * TENANCY REFORMS. ‘As stated earlier, tenants can be classified into ¢oezupaney tens (ii) tenants-at-will, and (iii) sub- Manis, Ocoupancy-tenants enjoy permanent rig : ee ees levee a ay rent on time. However, tenants-at-will and sub-tenants Ire in a precarious position. Their very existence depends sn the mercy of landlords and this makes them prone to ‘arious exploitative practices adopted by the latter. Therefore, itisto protect these people that special laws have had to be enacted and implemented. The National Sample Survey {6th round) had estimated that in 1953-54, about 20 per cent of agricultural land was under this system. The percentage varied from 6.7 in Madhya Pradesh to 27 in Punjab. In addition, about 35-40 per cent of agricultural land was under oral tenancy, but there are no accurate estimates in this regard.’ According to K.N. Raj, fpproximately SO per cent of agricultural land in India is inder one or other form of tenancy. Under the heading Tenancy Reforms, the following three measures are discussed: (if Regulation of Rent, ty SKeurity of Tenure, and (iif Conferment of Ownership Rights on Tenants. Ret Regulation of Rent In the pre-Independence period, the rent charged PY rzamindars fom the tenants was exorbitant. The British government was merely interested in its share and sonsequently gave unlimited powers of suppression fo the ‘amindars to squeeze the tenants. It has been estimated bY Brij Narayan that in Punjab as much as 80 per cent of the produce was extracted from the tenants by the Zamindars in the form of rent, In Bombay the rate varied between 40 to 60 per cent. According to H.D. Malviya, in the country as awhole, the rate varied between 34 to 75 per cent.!? These highly exploitative rates spelt misery on the ‘oiling tenants who could hardly make both ends meet. As 4 consequence, legislations were enacted after 1947 to regulate the limits of rents and reduce the burden on tenants. The First Five Year Plan stated that maximum rent should be fixed at one-fourth or one-fifth of the total produce, nd Kashmir, Tamil x 263 Tamil Nadu it is 40, per cent of gross produce for irrigated lands, 35 per cent where irrigation is supplemented by lift irrigation, and 33.33 per cent in other cases. {n Jammu and Kashmir, landowners have been divided into two categories — () those holding less than 12.5 acres and (Hi) those holding more than 12.5 acres. For the former fair rent has been fixed at one-half of total produce while for the latter it has been fixed at one-fourth of total produce for wet Jands and one-third for dry lands. In Andhra areas of Andhra Pradesh, fair rent is 30 per cent of total produce for irrigated land and 25 per cent for dry land. However, legislations fixing maximum limit of rent have been often violated, Because of the strong socio- economic and political hold of the landow! ‘countryside, they have been able to_ extra more_rent_from the peasants than ‘the _rent_fix legislations. For example, while in Bihar the maximum limit is 25 per cent of gross produce, share-croppers are usually required to pay 50 per cent. In Balasore District of Orissa, it was found that share-croppers had to hand over 50 per cent of gross produce as late as in 1972. Similarly, while Jaw had fixed the maximum rent at 25 per cent of gross produce in West Bengal, share-croppers continue to pay 50 per cent.!! This is partly due to the fact that in some areas “share-ctoppers-are not aware of the legal provisions_but more_importantly because of the fact that_they_are economically and socially weaker_as compared to the ners andare not in a position to assert their rights, fey are aware that any insistence on their part would only invite the wrath of landowners and they will be thrown out of land, In fact, in the absence of security of temure, any tenant asking for fixation of fair rent will be immediately ejected from land. Even where law provides for security of tenure, tenants are not in a position to take advantage of it because most of the leases are oral and informal. [thas been estimated that about 82 per cent of tenancies in the country jn 1961 were insecure. The apathy of the governments and their failure to take strong action against landowners who violate legal provisions, only increase the skepticism and fear of the tenants who, therefore, avoid any direct confrontation with the landlords. Security of Tenure CL? hoP ink ect tenants. from. ejectment_ and. grant, them ‘permanent. rights in land, Legislations have, been passed in vgislation for security of tenure had Tivee essential aims: (1) Bjectments do not take place except in accordance with the provisions of the law; () Land may be resumed by an owner, if at all, fo ‘personal cultivation’ only; and (3) Inthe event ofresumption the tenant is assured of a prescribed minimum area." Scanned with CamScannerY Indian Economy 264 1s pointed out by P.S. Appu, the degree of However afforded by the law ina particular area, protection to tenants depends upon the following important f 1. Definition of the term ‘tenant’; 2, The circumstances in which landowners are to resume tenanted land for cultivation; 3, Definition of the term ‘personal cultivation’; 4, Status of land records.!? Inall tenancy laws of the country persons cultivating the lands of others on payment of rent (either in cash or kind or both) are treated as tenants. However, in some States like Uttar Pradesh and West Bengal, sharecroppers (who pay rent by division of produce) are not regarded as tenants. Thus, all laws aiming at protecting tenants do not, in any way, help them. A limited right of resumption of land by landowners for personal cultivation was granted in all States excepting Uttar Pradesh and West Bengal. In some States, landowners were permitted to resume land right up to the ceiling limit while in others the permissible limit was below the ceiling limit. Several States also passed laws requiring the landlord to leave a certain minimum area with the tenant as and when he assumes land for personal cultivation, For example, the laws in Kerala, Gujarat, Himachal Pradesh, Maharashtra, Kamataka, Orissa and Tamil Nadu provided that one-half of the tenanted land should be left with the tenant. 4 36. abet The right of resumption combined with flaws in the definition of personal cultivation" rendered all tenancies insecure, The landlord could eject any tenant on the plea of personal cultivation. It was on account of this fact that the Fourth Five Year Plan recommended that all tenancies should be declared non-resumable and permanent (except in cases of landholders who are serving in the defence forces or suffering from a specified disability) and penalty should be imposed for wrongful evictions. ‘Another serious problem that had to be faced related to ‘voluntary surrenders’. Many landlords compelled their tenants to give up the tenancies on their own accord. In Di ea caeedia tnonerseniing theenancy law's because no laws can help the tenants if they give ledetiebtoluataiteaExpesionce has shown that ee the “voluntary” surendes were anything but voluntary. In ct, landlords applied various kinds of threats and on the tenants to surrender the land. Because ofthe weak socio-economic condit ‘ ir weak io-economic conditions and abject poverty, the easily succumbed to these pressures. I as on account of this reason thatthe Fourth Plan recommended that velerass ‘surrenders’ that ‘volunt should be regulated by the State i tary (Bbitinetarnctibiea ton eee furendred land which could be gen over ane noe es given over to other eligible allowed tenants selected by the government.'® This means th rs should be in favour of the governmen, wision has been enacted only in the hal Pradesh, Kerala, Orissa, Kamatg, surrender a However, this pro only of Gujarat, Himac! and West Bengal. Laws relating to security of tenure can be implemen effectively only if correct and up-to-date land records = svailable. A person can-claim that he is tenant gy" ‘his name appears-as-such-in-the-land records. ‘thas been observed that in many States either na recy of tenaney-exist-or-(in_areas where they exis) gy incomplete and out-of-date. In the States of Guia Haryana, Himachal Pradesh, Jammu and Kashmir, Madh, Pradesh, Maharashtra, Punjab, Rajasthan and Uttar Prades, there is a provision for annual revision of records. Howeve, several tenants do not try to get their names record because of the danger of being evicted. In other States, for example, Andhra Pradesh, Assam, Bihar, Karataks, Kerala, Tamil Nadu, Orissa and West Bengal there is no provision for annual revision of records which are usually brought up-to-date after long intervals. Thus, the records remain out-of-date for most of the time.'¢ Ownership Rights for Tenants Ithas been repeatedly emphasised in the Plan documenis that ownership rights-should be. conferred. on. tenants, tat is, they should be made owners of the land they cultivate, ‘Accordingly, some States have passed legislations to confer right of ownership on tenants. However, while some States did not adopt legislations for conferment of ownership righ, in some others the laws fall short of expectation. Wes Bengal, Karnataka and Kerala have achieved more success than the other States. In West Bengal, 14 lakh share-croppers have been recorded under the ‘Operation Barga’. In Kerala, applications of 24 lakh tenants for conferment of ownership were accepted. However, on the whole, the progress bas been very unsatisfactory. In fact, it was envisaged in the Sixth Plan that legislative measures to confer ownership right fo the tenants would be introduced in all States by 1981-82. This is still an issue that has to be tackled. Tthas been estimated that as a result of laws confering ownership rights on tenants in various States, approximate!) 12.42 million tenants have acquired ownership rights 0 6.32 million hectares of land. For a long period of 125 for this state of affairs were as follows: (1) many tent sould-not afford to_pay the purchase price, and (2)-18H ‘enants were ‘unwilling’ to purchase land. The second retS" see ata ms to be of far more consequence than the first because the State onvarnmamte diet ant canninn tho navilel Scanned with CamScannerLand Reforms ase price at one stroke, Frequently purchase price ofp in a nunbor of instalments cen peat the second reason relating to the unwillingness of eT to purchase land is more basic and once again tems the dominant controlling power of the landowners iis the tenants. In many cases, landlords pressurised Me tenants into submitting that they were nor interested in te purchase of land, Once this statement wi tan reverted to the original landowners, s made, the — es CEILINGS ON AGRICULTURAL HOLDINGS EEE NG) A ceiling on agricultural holdings means statutory absolute limit on the amount of land which an individual {nay hold. The imposition of a ceiling has two aspects — (ceiling on future acquisition, and (ii) ceilings on existing joldings. The First Plan favoured the former only as the inter was expected to create enormous problems of finance, administration and management. It was only the Second Plan that categorically recommended imposing ceilings on existing agricultural holdings. In this context, the Plan proposed the following questions for consideration: 1. to what lands ceilings should apply; 2, at what levels ceiling should be fixed; 3. what exemptions should be made; 4 what steps should be taken to prevent mala fide transfers; 5, what compensation should be paid for land acquired and 6. how should the acquired land be redistributed.!7 AAs far as the first question is concerned, the Plan ‘proposed that ceilings should apply to all future acquisitions of land and all existing agricultural holdings held under Personal cultivation (including Jand under permanent and heritable rights). In determining the levels at which ceilings Should be fixed, one has to decide the unit of application; that is, whether ceilings should apply to holdings of individuals or to holdings of families. The First Plan had Suggested the adoption of “family holding” which was defined as “an area equivalent, according to local conditions and under existing conditions of technique, either to a plough Unit or to a work unit for a family of average size working. with such assistance as is customary in agricultural ‘Occupations.”* should be fixed at about three family holdings. AAs far as the third question is concerned, the Second Plan proposed exemptions for following classes of farms: (1) tea, coffee and rubber plantations; (2) orchards where ‘they constitute reasonably compact areas; (3) specialised 265 farms engaged in cattle breeding, dairying, wool raising: ctc.; (4) sugarcane farms operated by sugar factories; and (S) efficiently managed farms which consist of compact blocks on which heavy investments or permanent structural improvements have been made and whose break-up is likely to lead (o a fall in production As far as the question of compensation to owners from whom land is acquired is concerned and as far as basis on which price should be recovered from persons to whom allotments are made is concerned, the Plan asked the States to lay down policy according to their own circumstances. F purposes of redistribution of land the Plan recommended that priority should be accorded to tenants displaced as a result of resumption of land for personal cultivation, farmers with uneconomic holdings and landless workers. To prevent malafide transfers of land, the Plan recommended that transfers of land which have already taken place should be reviewed and for purposes of ceiling the transferred land should be added to the land retained by the landlord ‘These guidelines laid down by the Second Plan have bbeen endorsed by subsequent Plans as well. However, they have not been applied uniformly in the formulation of laws by the State governments though laws have been passed in almost all the States providing for a ceiling on land holdings (excepting Nagaland, Meghalaya, Arunachal Pradesh and Mizoram where land is generally held by the community) While some States have accepted the plea for taking family as the unit for determining the level of ceiling, some States have taken individual owner as the unit, The States adopting the latter alternative (e.g., Andhra Pradesh, Jammu and Kashmir, Orissa, Punjab, Uttar Pradesh and West Bengal) have been more exposed to the risk of mala fide transfers, compared to the States adopting family as a unit. Widespread transfers of land have taken the sting out of the ceiling laws and have tended to defeat the aims of the legislation for ceilings. In many States, provisions were not made for disregarding of transfers and partitions subsequent to the date of announcement of the decision to impose ceilings on holdings. In some cases, exemptions were too many permitting evasion of ceiling on a considerable scale, Even the legislations (in whatever form they were) were not pursued and implemented effectively by the State governments, On account of these factors, the progress of taking over and distribution of ceiling surplus land has been tardy. To bring uniformity in the different policies regarding imposition of ceilings being pursued by the States, a conference of Chief Ministers was called in July 1972, Based on the consensus at the conference, a new policy on land ceilings was evolved. The main features of the new policy were as under: Scanned with CamScanner——————— Indian Beonomy 266 1 Lowering of ceilings to 18 acres of wet land and 1. Low eilings to 18 54 acres of unirrigated land; + The change over to family rather than the individual a mpe unt for determining tand holding lowered ceiling for a family of five er exemptions from : application of the law for declaring ons null and voids ings 3 4, Retrospect benami transi 5. Inorder to insulate the measure from challenge in courts of law, jurisdiction of civil courts has been barred; most of these laws have heen included in the Ninth Schedule of the Constitution, which places them beyond any challenge in courts of law on grounds of infringement of Fundamental Rights. Inthe light of new policy enunciated at the Conference, ccilings legislations were enacted by all the States except Goa and the North-East region. But the record of implementation has not been satisfactory. According to Twelfth Plan document, only around 3 million hectares has been declared surplus so far, which is hardly 2 per cent of net sown area in India. About 30 per cent of this land has not yet been distributed as it is caught up in litigations. Besides, a number of benami and clandestine transactions have resulted in illegal possession of significant amounts of land above ceiling limits. There are widespread reports of allotment of inferior, unproductive, barren and ‘wasteland to landless households, many of whom have been forced to sell it off, in the absence of resources to make it productive, In many instances, land allotted to the rural Poor under the ceiling laws is not in their possession. In some cases, pattas were issued to the beneficiaries, but Possession of land shown in the pattas was not given, or Corresponding changes were not made in the records of rights.!8 Moreover, as correctly pointed out by the Twelfth Plan, the balance of power in rural India is so heavily weighted against the landless and the poor that ae a laws is difficult, It is clear that ilisation of the rural poor and a eats inthe wak States like Karnate tka, the ir Are being sven exemption ceraly Sth Of the Government of ta 80 against the aa © of the economic liberalisation, sand depress agricultural wages, tty, crease landless tise Jose examination, before such exempyn, this issue requires c rt ¢ givel ase for Ceilings 1. The social rationale. The basic rationale for cen, on agricultural holdings rests in the social field. 1 is argue, that in a poor economy where the supply of land is trite while the number of eat is poniiny Jere, ity cia st to allow a small number of people to hold , millions of labourers to the interests of this handful minority ‘A large number of people belonging to this privileged clas, of landlords function merely as absentee landlords ang their land continues to be cultivated by landless labourers ‘and petty peasants, Therefore, the social inequalities and exploitation cannot be eliminated unless and until land js ‘aken away from the hands of the landlords and handed over to the toiling masses. The basic aim of the ceiling laws is to accomplish this objective through elimination of sive ownership of land”. Even otherwise since land ree in relation to the demand for it, it is best to distribute it among its users rather than allow part of it to g0 {0 non-users who would benefit merely from their title to its ownership without performing any identifiable functions, 2. Improving the position of the poor. The income of the poor who receive land as a result of redistribution (consequent upon imposition of ceilings) is expected to rise Pulling them above the poverty line. A study by R. Sinha and others showed that with equitable distribution of land “the per capita income ofthe rural poor is more than doubled, as is their share in total personal incomes, Both the pet Sapia income level and income share of the middle group ave increased by more than half. ‘The rural top class, on the ciher hand, suffers a loss of one-third in incomes and income- by therag eacticaly similar argument has been forwarded ie poo AR aely quoted publication titled Agriculture nes: cording to FAO, “Redistribution of only weet eM apaland in India, coupled with improved cent under nan Could reduce rural poverty level by 30 per conditions a {han would otherwise be, so that in Indian eae Sostnd and water reform would be a key eek eas that redistribution of land is likely riral poor, eM! improvement in the position of the who pea ieetoer argument. There are economis! managed in comma nt farms can be more efficiently Hanamanth sitatison to large farms, For example, CH meh Rao has pleaded for redistribution of land afler carefi : Sareful examination of Farm Management Dat. Scanned with CamScanner