28th Conference: Information Documents

In general, the Indian economy as a whole has done badly under the New Economic Policy. (NEP). Its performance in the field of agriculture has been no better.

Even with the progress achieved since the mid-Sixties, the rate of application of modern inputs is quite low in India by world standards, and, as a consequence, yield per unit of land, relatively low. The average level of fertiliser use (as kilograms per hectare of the cultivated land) is only 720 kg in India, which is less than the figures for Bangladesh (1032), Pakistan (1015) and Sri Lanka (964), not to speak of China (3005) or Egypt (3392). The domestic fertiliser production has increased by one million ton – from 9 to 10 million tons – while the domestic consumption of fertiliser has increased from 12.5 million tons to 14.1 million tons, necessitating further imports, the domestic production could have been higher had the government not followed a deliberate policy of closing down public sector fertiliser units, particularly in eastern India. On the other hand, domestic consumption would have been still higher, had the subsidies not been scaled down. The amount of subsidy given to fertiliser has declined from Rs 5796 crores in 1992-93 to Rs. 4000 crores in 1994-95. In last year alone, the fertiliser price has increased by 20%, the price of urea being Rs 3320 per ton. In fact the decline would have been steeper had the elections not been round the comer. There is no doubt that, if Congress or BJP win next election, there would be further, drastic reduction in subsidy.

Another aspect is the lack of balance in fertiliser use. There is a tendency to use more of nitrogen and less of phosphate and potash. Ideally nitrogen consumption should not be more than double the phosphate consumption; it is actually three times more. Similarly, ideally phosphate consumption should be no more than twice that of potash consumption, but actually it is three times more. In other words, because of lack of balance, the peasants spends more money on fertiliser to get less. Necessary extension work is lacking, as the market-oriented economy allows the suppliers of fertiliser play on the lack of knowledge of the ordinary peasants.

Subsidy reduction is not confined to fertiliser. The policy of World Bank/IMF/GATT/WTO is to reduce subsidies in other forms too-in power, irrigation, support prices given to farmers, in interests, in poverty alleviation programmes and in the public distribution system. Because of political compulsions, the government has not carried out subsidy reductions to the extent it desires, until now, but, as we have noted in case of fertiliser, the situation might change drastically, and adversely for the farmers, should the parties supporting NEP win the next election.

Until the launching of the New-Economic Policy, Indian agriculture was by the large self sufficient, in terms of both food output needed to satisfy the consumption needs of the population (excepting the very poor who can not buy from the market, and, hence, suffer from under-nutrition) and of the input-seed, fertiliser, tractors etc,-that were required for producing that output. From the very first year plan in 1951 until the eighth plan, all the Indian plans advocated self-sufficiency in food production as one of the top three or four of the national economic priorities. Advise rendered by FAO and other UN organizations also stressed the need for food security. Such a policy was also in tune with a common-sense view that a country, relaying mainly on agriculture, and not producing many industrial goods, should try, at the least, to meet the food needs of its population.

Here we will briefly summarize some of the major implications of the functioning of multinationals in agri-business – both as provider of inputs and producer of outputs, and both in relation to agriculture and rural industries.

Capitalist development in agriculture is a process which has been going on for a long time. But under NEP it has generated a new and powerful momentum, as the national monopolies and multinationals are increasingly penetrating in agriculture and the peasants—through buying inputs and selling produce in the market— is becoming increasingly enmeshed in the process.

However, the bill cannot be any substitute to the political will. Congress(I) was more interested to enact than to act. The Congress(I) Governments of Andhra Pradesh, Karnataka & Kerala, for example, did not hold elections to three tier Panchayats within one year of these constitutional amendments as directed by the Central Government. Even the Supreme Court directions in this regard were not implemented. The Congress® Government of Orissa, soon after being voted to power, dissolved the Panchayats much before the completion of their scheduled five-years term. The trends of centralization continue to be strong. The Center is refusing to transfer the centrally sponsored schemes along with the funds to the states as resolved in the National Development Council. The funds meant for some of these schemes implemented through PRIs are being directly passed to the districts bypassing the states. The conference of Panchayat representatives from all over the country is being convened at New Delhi and the State Governments are being asked to invite Union Ministers to inaugurate similar conferences organized by the State Governments. The centre, while asking the states to devolve more power and finances to PRIs, itself continues to rob the states of their powers and resources. The big hoax can be clearly understood from their tall talks to build up Panchayats as local self governments when the status of the State Governments have been reduced to that of a glorified municipality. This nefarious game of Congress(I) regimes at the centre and the states must be fully exposed. It is equally important to see that people develop no illusion about their campaign to project themselves as the champions of democratic decentralization through Panchayats. At the same time, people must be reminded time and again that the record of BJP led State Governments is no better than this. They do not care even to insist in public on their declared opposition to any concept of strong states, decentralization and land reforms etc. The rural cooperatives in both Congress(I) and BJP regime continue to be the seat of power of vested interest and reaction in general with most of these institutions languishing in absence of democratization and regular elections. It is only in the left led states that PRIs and cooperatives have emerged as viable institutions of the people and in West Bengal alone these could enjoy the longest lease of life for uninterrupted eighteen years.

During last two decades, West Bengal has been the only State in the country to have held elections to all three tiers of PRIs, in a single day, at regular five years intervals, for four consecutive terms. With the political parties contesting with their elections symbols and a turn out rate even higher than the Assembly and Parliament election (85% in the last Panchayat General Election held in 1993) the entire process assumes the shape of intense class and political battle. Presently more than 35% of the members elected are women and a significant number of candidates belonging to Scheduled Castes and Tribes community have been returned from the constituencies not reserved for them. More than 70% of the Panchayat Members belong to the rural poor and toiling sections, a class composition, diametrically different from that of the Panchayat of the non Left led states. Similarly the class compensation of the Cooperatives has undergone a sea change with massive enrollment of vested land allocates, sharecroppers, the agricultural labourers and the poor peasants under the universal membership scheme. Thus the State Cooperative Bank, majority of the District Central Cooperative Banks and all the Zilla Parishads have come to be chaired by the CPI(M) and Kisan Sabha activists. This has its basis on the successful implementation of some land reforms measures backed by the political will of the state government combined with the organized struggle of the peasantry. West Bengal while having only 2% of total land in the country, accounts for about 20% of the total ceiling surplus lands distributed in the country. As per NSS data, nearly 60% of the total agricultural lands in West Bengal has come to be avoid by small and marginal farmers (as against the corresponding national average of 29% only) and adding to it the land cultivated by about 1.45 million recorded share croppers this will exceed 70 percent. Out of the 2.21 millions families alloted with vested lands, 56% belong to SC and ST communities constituting only 27% of the state’s population. The lands matched with the credit from the cooperatives and other non land inputs delivered through the Panchayats resulted in a major breakthrough in the agricultural production in the state since independence . West Bengal having only 2% of the total land in the country, has to support 8% of its population and right now it grows 15.8 percent of rice, 30.4% of potato, 60.5% of jute and mesta, 21.3% of tea, roughly one third of fish and three fourth of the fish seeds of the country as a whole. During the seventh Plan period the State achieved the highest growth rate in food grains production (34%) with Haryana (24%) and Punjab (23%) occupying the second and third position respectively. It is also the first among the Indian states to become the recipient of prestigious international awards e.g. UNESCO’s NOMA award for literacy and J. Paul Getty award for conservation of forest and bio-diversity. It is the devolution of over 50% of the State Plan Budget to the command of District Planning Committee chaired by the chairpersons of Zilla Parishads and further devolution to the sub-district levels through he PRI with the leading role in all spheres of rural developments that these could be achieved. The mandatory provisions to ensure participation of electorate through Gram Sabhas and Gram Sansads, the anti-detection low to checkmate violation of political mandate and the provision of District Council headed by the leader of the opposition in Zilla Parishads with the status similar to that of Public Account Committees are some of the distinctive features of the West Bengal Panchayat Act.

It is precisely this alternative growth path based on land reforms and Panchayats as opposed to the bankrupt anti people policies perused by the Congress(I) and BJP, that the AIKS should propagate to rally the entire peasantry around it. Devolution of more power and resources to the states from the Centre and to the PRIs from the states should continue to be the integral part of the demand in our struggle for democratic decentralization even in the Congress(I) and BJP ruled states. This is inseparable from the battle for national integration in a multinational country like ours. Our Kisan Sabha activists working in the PRIs and cooperatives must be able to utilize these institutions as instruments for forging broadest possible unity of the peasantry and also as the instruments of unleashing class and mass struggle in the rural areas to bring about a decisive change in the correlation of class forces in the desired direction. The movement against the social disparities like caste and gender disparities must be linked up with these class battles. While doing so one should have no illusion that real rural self government can be established within the framework of existing bourgeois landlord order, without radical land reforms. Neither the Panchayat can assume the role of self government nor the cooperatives can be utilized as the instruments of real self reliance when the country is forced to abandon self reliance in the name of structural adjustments. Nevertheless we must leave no stone unturned to get hold of and utilize these institutions to realise whatever partial demand of peasantry can be realized . The PRIs, wherever our Kisan Sabha activists have a majority, can and must be successfully utilised in the struggle of realizing the realizable demands for land, wage, homsted, credit, water, seed, fertilizer, technology and many such other partial demands. Where we are in opposition, we must act in a principled and organized fashion inside the Panchyat body, while, at the same time, utilizing the meetings of Gram Sabhas for rallying masses of peasantry in our favour. All these struggles of partial demands have to be linked with the propaganda on the basic demands of radical land reforms so that more and more people get convinced from their own experience about its necessity. It is only by maximizing the participation of the peasantry and other democratic forces in the rural area in this process that the ultimate goal of the Kisan Sabha can be realized.

1. The Kerala land reforms has been hailed as a success story by several independent observers. The Kerala Land Reform (Amendment) Act 1969, which was implemented from January 1,1970 was hailed by a foreign scholar as “the most drastic of any land reform legislation passed by any State legislature of India (John Mencher, 1976).

The 1959 and 1969 Acts together changed not only the land ownership pattern but also contributed a lot to the social transformation of rural Kerala. Feudal landlordism was abolished, ownership of the land was given to the tenant, and the agricultural workers, who were the hutmen dwellers of the landlord, were entitled to the ownership of 10 cents of land. Major gains were also made in the matter of taking over and distributing the surplus land.

1. The impact of the land reforms on the pattern of land holding is shown in its Table annexed. Whereas in 1955-56 the highest segment, viz those holding more than 10 hectare of land and above constitute 1.4% of the total number of owners, held among themselves 31.0% of the land, their share has come down to 0.1% and 9.8% respectively in 1990-91. At the same time those holding less than one hectare, who had only 19.5% of the total area now command ownership of 48.8% of the land. Similarly the share of those in the 1-2 hectare category also has gone up while that of 4-10 hectare category has drastically come down.
2. However, the reading of this table alone is not sufficient. In fact it conceals certain undesirable trends, especially with regard to the average size of holding. As per the Government records the total land under cultivation in the State is 18,01,823 ha. In 1970-71 the average size of marginal holding, viz below one ha. was 0.29 hectares, which was the lowest in the country. As per records, the total number of holdings in 1990-’91 was 54,19,189 which workout to an average size of 0.33 ha per holding. Out of this 54 lakh households 92.5% fall in the less than one ha category (50,12,749). This shows that the average size of the marginal holding has come down to 50% in the post-land reform era.
3. This raises a lot of practical problems. For one, such a small size of the farm may turn out to be uneconomic, if only the traditional farm practices are followed. It may not support the family and they may hold on to the land only in the expectation of capital appreciation. In fact there is a wide spread feeling in the state that, especially due to the Gulf boom, land in Kerala is not a productive tool but just a piece of real estate.
4. Secondly, once land becomes just a piece of real estate, there is not attempt on the part of the owner for its development for productive purposes. He is not concerned about its productivity and he dare not invest capital for technological upgradation. Unattended farms are a very common feature every where in the State.
5. Thirdly, since the land he owns is uneconomic, the owner has to look for other sources of income. He may get a job away from his home and visit his plot only once in while. Absentee ownership is widely prevalent, which once again results in non-investment for productive purposes. This has led to a new trend—return of the rent system. The small holder gives his land to a big holder for a specific rent, mostly for seasonal farming. In several parts of the State this has become wide spread, raising new issues in agrarian relations.
6. Finally, there is the question of the degradation of the land also. In several districts paddy fields have been converted into brief kilns. The fertile land is used not for cultivation, but for making bricks, an industry which has boomed since 1970s as a result of Gulf remittances.
7. The reason for this state of affairs, we many argue, is that though radical land reforms were implemented, appropriate mechanisms were not evolved for enthusing and enabling the peasant to increase production and productivity. Though there is the predominance of agricultural co-operatives, due to the lack of an integrated approach, the peasants, especially belonging to the marginal category, have not been able to draw full benefits from it. The woes of the Kerala peasantry are intrinsically connected with the lack of this integrated approach.

1. As per the 1991 census figures 31.4% constitute the work force, of this 12.27% cultivators and 26.59% agricultural labourers. The share of both these categories in the work force has come down since 1981. While the percentage of cultivation has come down 1.5% from 13.7%, the reduction in the case of agricultural labourers is more glaring by three percentage points, from 29.5% to 26.5%. It may be noted that there is no reduction in actual numbers. In fact the number of cultivators and agricultural labourers have gone up during the period.
2. Agricultural growth in the state is stagnating. During 1960-61 to 1970-71 the average annual growth rate was 2.59%. Between 1970-71 and 1985-86 it fell to 0.61 and it was only during 1985-86 to 1990-91 that agriculture could make some headway. The growth rate during that period, when the Left Democratic Front was in office, was 3.52% . Since then it has come down again.
3. Perennial plantation crops dominate Kerala agriculture. 8.8 lakh hectares are under coconut, 4.4 lakh hectares under rubber and about five lakh hectares under pepper, cashew, coffee, tea etc. Only 5.3 lakh hectares are available for rice. The area under rice is diminishing at an average rate of 25,000 ha per year.
4. The Kerala peasant faces two major problems-a) the increase in the cost of inputs and b) the unpredictability of the price of their produce. The price of inputs are fixed either by the Government or by the monopolies. Over year these have increased several fold. At the same time the price received by the farmer does not increase in proportionally. The prices of most of the produce in Kerala are determined either at international markets or by the Indian monopolies, who always try to suppress it for increasing their profit. As a result of these two factors the Index of Parity between the prices paid and received by the farmer stands to his disadvantage. While the index of price paid by the farmer was 1435 in 1991-92 (1952-53=100) the index of price received by him stood at 1315, which was only 92% of that paid by him. As per Kerala Government records since 1977-78 only in two years was the index more than 100, showing the pauperisation of the peasantry.
5. This might be one reason for the stagnation in Kerala agriculture. The farmer is not enthused to invest in his land, with the intention of increasing production and productivity. Except in the case of rubber and rice the productivity is abysmally low. In the case of rice, in 1992-93 while the national average was 1744 kg/hectare it was 2018 kg/hectare in Kerala, However, this is much lower than that available in the Green Revolution areas, in the case of coconut the productivity was only 5843 nuts compared to 7032 nuts at all India level. In Tamil Nadu it is much higher, something like over 11,000 nuts per hectare. As far as pepper is concerned Kerala’s productivity is lower than the all India average by 40 kg. The all India productivity stands at 310 kg/hectare while in Kerala it is only 271 kg/hectare. Since Kerala is the major producer of rubber it determines the all India productivity.
6. This brings us to the question of prices. As noted earlier, the prices of most of the Kerala products are fixed at either international markets or by the Indian monopolies and therefore the prices, instead of increasing, either stagnate or experience a steep- fall.

While the price of rubber is the best example for the former, coconut, coffee etc fall in the latter category. This can be explained as follows.

1. Coconut is the mainstay of Kerala’s economy in view of its multifarious contribution to income and employment. During the last decade the coconut production was something between 3500 to 4000 million nuts per annum. The average price of coconut was more or less stable around Rs. 4/- per nut. However during the past three years it has plumettered to Rs. 2.50 to Rs. 3.00. On an average the Kerala coconut farmers have lost something like Rs. 500/- crores per year, it is the Indian monopolies who made a given buck, coconut being a raw material! for scabs and perfumes, the industrialists have got it cheap, without a corresponding reduction in the price, of their products.
2. In the case of rubber stagnation in the price at the behest of the tyre lobby, is the main problem. It is the Government of India which declares the bench-mark price which they refuse to increase resulting in price stagnation. For three consecutive years-1989-90 and 90-91 and 91-92 —it hovered around Rs. 21/- per kg. There was small increase next year, without corresponding change later.
3. The some is the case with coffee, pepper etc. The peasants are at the mercy of international tycoons who control the prices of these products. With the retreat of the Government from Market operations the farmers have started feeling the pinch. The farmers have started realizing that the solutions to their sufferings does not solely depend upon prices. If they have to survive they should look into the problem of raising productivity. How can the productivity be increased only through innovative approaches in production.

The average size of the farm becoming smaller every day tradi­tional techniques are of no help. The small farmer does not have the capital to invest with the intention of attaining higher production and productivity. What can be done in this situation, is the big question.

1. We may suggest that co-operative action is the solution to the problem. It may be either institutionalized under co-operative societies or just a voluntary affair as was experimented during the LDF regime, under the name of group farming. Whatever be the form wherever possible, procurement of inputs, the agricultural operation as such and the marketing of the produce should be converted into a collective action. This not only results in economies of scale but also bad to higher investment in water management and the like and in the end achieve higher productivity. Once the land reforms were implemented this approach should have been viewed as a natural corollary. We know from history that the voluntary action, mentioned above, was of recent origin. What we intend to examine is whether the institutional form, viz the cooperation has been used with this aim. The question before us is whether the Kerala Co-operative movement has done anything in this situation to alleviate the sufferings of the peasantry and if so its achievements weaknesses and the lessons of experience. Before that a brief resume of the co-operative movement in India is appropriate.

1. The Co-operative movement in India had its origins in the first decade of the 20th century. After independence the movement spread throughout the country and its number stands at approximately 3.53 lakh now. Together they have a membership of 16 crores and working capital of Rs. 70,000 crores. It is one of the largest in the world. Agricultural credit societies constitute the most significant segment in the co-operative sector.
2. The Indian Co-operative are partially appendage of the Government. Instead of being developed into a mass movement, to protect the interests of the farmers, artisans and weaker sections from the exploitative private sector, their powers are curtailed and strength eroded, systematically. The Indian Co-operatives are mainly state sponsored and the basic act framed in 1904 by the colonial regime continues to govern their working without much modification. The Registrar is supreme and the whole set up is bureaucratized. Though representing thousands of members the leaders of the society have little authority on their own. For every important decision they have to get concurrence from the Department and the governing committee can be dismissed at the whims and fancies of those holding political power. Democracy remains in paper.
3. This has hampered the development of the movement to a great extent. The general mood is that of disenchantment and lack of vision about the co-operatives. When the private capital is making an all out attack on the people, especially the peasantry and the rural folk, the movement which ought to raise the flag of resistance is failing in its duties. And with liberalization the fate of co-operatives hangs in balance. While the Eighth-Five Year Plan hardly mentions this sector, the New Agricultural Policy paya lip service to the rejuvenation of the co-operative movements, that too in the area of the processing of agricultural produce and development of the non-farm sector. The situation being such, it is high time that the AIKS pays a little more serious attention to these problems.

Having said this we propose to examine the Kerala experience. We have noted that, to a certain extent, the woes of the Kerala peasantry lay in the failure of the co-operative movement to develop an integrated approach towards agriculture. This is not to minimize the importance of co-operative movement in the rural life. It mainly caters to the credit needs of the peasant. But it is not only credit that is required by him. Once the peasant has been provided with the land, through land reforms, easy credit should be made available to him towards the cost of inputs and a mechanism should be evolved for marketing of his produce, to save him from the exploitation of middle men. In agriculture co-operatives are considered the most suitable institution which comes to the aid of the farmer in both production and marketing. In Kerala this has special relevance, since as noted earlier, over 90% of the farmers fall in the below one hectare category, who do not have either enough capital or the strength to resist the attacks of the middle men.

1. As far as the credit needs of the farmer is concerned, Kerala does not have much to grumble. D.K. Desai maintains that Kerala is the only state where agricultural credit needs of farmers are fully met. The supply of credit was 10.2% of demand as against 12% for the country as a whole in 1984-85. There are two reasons for this. One is the development of commercial banking and the second, the predominance of co-operative credit societies. Since our theme is the latter, we confine our discussion to the co-operative sector only.
2. Co-operatives have played a major role in the rural life of Kerala during the past three decades. There are 1580 Primary cooperative societies in the state with a membership of 10 million in 1993. One third of the population are members of such societies. Between 1987 and 1993, the increase in the membership was phenomenal. In six years it has gone up by almost 50%, from 68 lakhs to 100 lakhs.
3. With the increase in membership, the share capital also has gone up several fold. From Rs. 16.58 crores in 1987, it increased to Rs. 86 crores in 1991 and further to Rs. 115 crores in 1993. These societies together have reserves amounting to Rs. 100 crores and deposits to the tune of Rs. 1506 crores in 1993. The total loans out­standing as on 30-6-93 was 1494 crores.
4. Even though named Primary Agricultural Societies, they finance not only agricultural operations but also the other requirements of the peasantry. Infact, the latter has overtaken the former in recent times. In 1987 out of Rs. 585 crores issued as loans Rs. 281 crores were for agricultural purposes and Rs. 305 crores for non-agricultural purposes. In 1990 these were Rs. 274 crores and Rs. 486 crores respectively. By 1993 there was great leap towards non- agricultural purposes. That year out of the total outstanding dues of Rs. 1494 crores only Rs. 538 crores were for agricultural purposes, with Rs. 956 crores going for other purposes.
5. Agricultural co-operatives should have an integrated approach, meeting the credit need s of the farmer, supplying inputs like fertilizers and providing marketing arrangement for the farmers supply vital inputs like fertilizers. Almost 90% of the fertiliser needs of the farmers are met by the co-operatives. Where the cooperative sector lags behind is in the matter of marketing. This is a major issue since Kerala Agriculture has a predominance of cash crops, especially of perennial variety. The main problem faced by the peasantry apart from the increase in the cost of inputs, is the fluctuation in price. Here the involvement of the co-operative sector is, to say least, negligible.

1. It is in the matter of marketing that the co-operative sector has failed completely. The Economic Review 1994, the official publication of Kerala government notes, “most of the commodities produced in the State move out of Kerala in their raw form for processing and distribution. As the cropping pattern of Kerala is predominated by export oriented cash crops and their production is concerned in the small farm sector, marketing support is critically important for Kerala agriculture…. As the production is spread over millions of tiny holdings, mobilizing marketable surpluses, primary processing, transport etc are all becoming difficult as well as costly. Even though co-operatives are operating in the market they are yet to gain any effective control on the market forces.”
2. The main agencies functioning in the co-operative sector for marketing of agricultural produce are the Kerala State Cooperate Marketing Federation Ltd (MARKETFED). The Kerala State Co-operative Rubber Marketing Federation. Rural Agro Industrial Co-operative of Kerala (RAIDCO), Central Arecanut and Cocoa Marketing and Processing Co-operative (CAMPCO), Kerala Kera Karshaka Co-operative Federation (KERAFED) and Cashew Apex Industrial Co-operative Society (CAPEX). It is pertinent to study the activities of these State-level agencies to have an idea of their influence in the agricultural produce market.
3. The MARKETFED is supposed to do market operation to help the farmer realise remunerative prices for his produce. It deals in all types of products like copra, pepper, cardamom and cashew nut. However their interference at the instance of the coconut, pepper cardamom growers is very very poor. Millions of tonnes of Copra (dried coconut) are produced in the State every year. According to official sources, the inter-state trade of the product is around Rs. 600 crores per year. However the business of MARKETFED was limited to 4550 MT worth Rs. 8.43 crores in 1990-91. This went down next year to 2005 MT valued at Rs. 4.06 crores. In the case of Pepper while the production is around 50,000 MT the MARKETFED handled 202 MT in 1992-93 and 300 MT in 1993-94. Regarding Cardamom the MARKETFED handled only half per cent of the total production in 1992-93 . While the production was 1400 MT it did business in seven MT. Cashew nut used to be the major item in the inventory of MARKETFED, since it was appointed as one of the agencies for procurement of raw nut in Government owned factories. In 1992-93 it handled about 25000 MT valued at Rs. 63 crores. However with the procurement policy having been given a decent burial and the government factories returned to private parties that operation also is on the wane.
4. RUBBERMARK is one institution which is making some impact on the peasants. This agency gives not only market support but also assist in production. For example in 1990-91 it supplied through its own outlets and the PACS fertilizers to the tune of 207975 MT. It also undertakes aerial spraying for pest control. In 89- 90 the area covered was 44650 acres which went up in 90-91 to 60,000 acres. In the field of marketing also it is very active. It has a market share of approximately 10%. It purchased 28662 MT of rubber in 90-91 and 41500 MT in 93-94.
5. Karnataka was intended to help the arecanut and cocoa growers its operations are on the down swing. While it purchased 2399 MT of arecanut in 89-90 it had come down to 1628 MT in 92- 93. One reason may be the lower production and higher prior. The value of its purchase has gone up from Rs. 67 crores in 89-90 to Rs. 108 crores in 92-93. Regarding cocoa it is still worse. The purchase was only 330 MT in 89-90 going down to 245 MT in 92-93.
6. One major agency in the coconut market is KERAFED. It purchases Copra, processes it and sells coconut oil. However the experience of the coconut growers is that at times of distress the Federation does not come forward with a helping hand. 1990-91 was a good year for the farmer, when the price of coconut hovered around Rs. 4/-. Since then as noted earlier, the price has gone down to Rs. 2.50/-. However, it is at this time that KERAFED had reduced its market operations. While in 1990-91 it purchased 28490 MT of Copra the purchase when down to 24482 in 91-92 and 20091 in 92- 93. Next year it was slightly better, at 22,169 MT.
7. Having reviewed the performance of these state-level cooperative agencies in the agricultural marketing segment we may look into the operations of the Primary Agricultural Credit Societies also. As per official documents the value of agricultural produce marketed through these societies in 1987-88 was Rs. 44 crores only which went up in 89-90 to Rs. 58 crores. Though in 1991-92 it achieved a turnover of Rs. 80 crores, next year it went down to Rs. 58 crores. This should be compared to the total agricultural income of the State which stood at over Rs. 5,000 crores. It shows that the PACS deal in only about one percent of the total agricultural produce of Kerala.

1. Having implemented land reforms what Kerala should have done was to evolve suitable mechanisms with the aim of raising agricultural production and productivity. However it was viewed as though lack of credit was the only thing hampering agricultural production. It was thought that once the farmers are given easy credit, both production and productivity would pickup. The policy makers never addressed themselves to the problem of marketing, stabilization and periodical hike in prices and so on. This created precarious situation, leaving the peasants to vagaries of the market including exploitation by middle men , Indian monopolies and the international capital. This in turn had an adverse impact on production and productivity, with millions of small producers becoming unable to invest capital. Had the grass root level co-operatives also been given the task of acting as the agency for marketing agricultural produce, the situation, to a certain extent, could have been different. The PACS with the active involvement of the State level agencies could have made an impact on the market and thus, to a certain extent, checked the exploitation of the peasantry.
2. While discussing some of the undesirable trends which have emerged during the post-land reform era, we have made a point regarding absentee ownership. We have noted that the owner being away, farms lie untended. However of late, a positive trend also has emerged at least in some isolated parts of the State. We have reports that in certain areas, the PACS have been authorized by the absentee owners to tend their farm, market the produce and credit the amount to their account. These maybe isolated cases,but it opens up new possibilities, which in turn may augur well for Kerala agriculture.
3. Productivity is one of the main concerns in the State’s ag­riculture. The average size of the farm being very small it is practically impossible for the individual owner to acquire better technology for raising productivity. Collective effort is the remedy for this. During 1987-91 period we started the group farming system. Even though the ownership of the land remains with the owner, agricultural operations in a specific area are done jointly which results in economies of scale. PACS was to have actively participated in this programme by providing agricultural machineries etc. However, under the UDF regime, like many other projects, group farming also has been shelved, though it remains in paper even now.
4. The potentials of the co-operatives have not been utilised to the maximum possible extent. It can be rated as the biggest mass movement in the State encompassing 10 million people, which is one third of the population. However at times it has been used by vested interests, for private gain which is happening now. Democratic functioning of the societies have been hampered with the imposition of bureaucratic raj. Therefore serious discussion should be held to find ways and means for preserving the democratic functioning of the co-operative sector.

Defining rural development is indeed a challenging task. Because, though it is an old theme, it is evolving around new content and responding to fresh concerns. Therefore, any meaningful definition of rural development has to be time-space specific.

The concept of rural development in India was born in the context of agriculture and has remained synonymous with agricultural development for a long time. To exemplify, the Royal Commission on Agriculture (1928) remarked – “We cannot too strongly state our conviction that the directorship of agriculture is one of the key posts in rural development”. Nearly 54 years later the Planning Commission’s Task Force on Integrated Rural Development observed in 1972 – “After careful consideration we have belatedly decided to take what might be considered a rather restricted view of the expression ‘rural development’. We have chosen to equate it with agricultural development in the widest sense so as to embrace, besides crop husbandry, all the allied activities.”

However, since the 70’s, the concept of rural development became more confined in its interpretation. Indian official thinking became largely influenced by the views of the World Bank on the subject. The Bank suggested a shift in the emphasis and defined rural development as a strategy designed to improve the economic and social life of a specific group of people – the rural poor.

It would however, be wrong to assume that the Bank ideologues were moved by compassion towards the rural poor in the developing countries. That they were essentially prompted by a more prosaic concern becomes evident from the subsequent arguments advanced by the concerned World Bank paper [World Bank: Rural Development (Sector Policy Paper) page-3]. The paper argued that since rural development intends to reduce poverty it must be designed to increase production and raise productivity. The Paper further pointed out that the provision of improved food supplies and nutrition, together with basic services such as an health and education, not only contribute to physical well- being of the rural people, but also to raise their productivity and ability to contribute to the national economy. Therefore, in the views of the Bank the objectives of the rural development could not remain restricted to any single department but should spread over several, and the resultant mix will serve to raise agricultural output, create new employment, improve health and education, expand communications, provide housing, etc. Of course, what the Paper did not spell out in so many words and what discerning functionaries of an organization like the AIKS should have no difficulty to understand is that all these concerns for the improvement of the rural poor was influenced by the imperatives of an expanded global market. The economic empowerment of the rural poor with purchasing power in the developing countries was an absolute prerequisite for facilitating the reach and sweep of the global big business.

Therefore, it does not appear surprising, if seen in the context of this World Bank thinking, the almost ’revolutionary’ tenor of the official Indian view on the subject. Rural development thus is currently being viewed as a strategy to bring about an improvement in the economic and social life of the rural poor. The 8th Plan reiterating the formulation of the 6th emphatically asserts – “The recent Five Year Plan’s have emphasized the importance of the direct anti-poverty programmes. This is a highly relevant approach and 8th Plan should continue with this approach, even though the specific nature and contents of the anti-poverty programmes may need certain modifications for a more effective direct attack on poverty.” Similarly, the Rural Development Ministry sounds almost repetitive – “Rural development has come to mean a direct attack on rural poverty through special employment programmes, land reforms, area development programmes and measures to provide safe drinking water, water supply and rural housing and rural sanitation ” (Annual Report of the Rural Development Ministry, 1992-93, P.l)

The fact that brave words are no substitutes for the transformation of the grim reality that threatens rural India becomes obvious from the continuing ’wretched of the earth’- status of the rural poor in the country. It is impossible to transmit the positive impact of the so-called ’direct attack on poverty’ to the rural poor, unless the power balance in the countryside shifts decisively in favour of the rural poor.

The fundamental shortcoming of the official approach towards rural development lies in the fact that it does not touch the subject of refashioning the existing power structure of rural India. Therefore, notwithstanding repeated references to poverty alleviation in Plan after Plan the absolute number of people crawling over the poverty threshold has remained abysmally low. The governments cannot therefore escape the question as to what happens to the supposedly huge investments that it claims that it is making. The late Prime Minister Rajiv Gandhi once gave a candid reply by pointing out that out of every rupee on development only 15 paise reach the legitimate beneficiaries. 85 paise disappears somewhere midway.

It appears that there has been no fundamental change in this situation. The pro-rich bias of the implementing agencies ensures that the benefits do not find their way to the rural poor as will be evident from the project wise evaluation of the different schemes of the government. The government simply does not have the political will to refashion the power structure.

While the democratic kisan movement cannot lose sight of this fundamental and inherent weakness of the rural development programmes, it will be absolutely unwise to outrightly reject them as ineffective. In fact, the struggle for proper implementation of these programmes as theoretically enunciated by the government can become rallying points for broad sections of the rural poor. In order to effect such a course of development, it is necessary to raise issues and demands, specific to projects, at all levels right from the village to the national. While this approach can pave the way for partial gains in respect to specific programmes, on the other hand it can also lead to the elevation of the level of political awareness of the peasantry – more particularly the poor and the marginalized sections’- in so far as recognizing and realizing the basic limitation of the rural development programmes is concerned.

There have been a large variety of rural development programmes since independence. The following table gives a fairly exhaustive list of such programmes at different points of time.

It will be difficult to discuss at length about the features of all these programmes. But it has been mainly three approaches which has dominated the design of the projects since independence.

The first was manifest in the Community Development Programme (CDP) which evolved a completely new feature of having a multi-function Village Level Worker (VLW) co-ordinating the activities of different departments. It emphasized on agricultural development and was conducted in areas which were either endowed with irrigation facilities or had assured rainfall. The basic critique of this programme remained in its failure to arouse and sustain people’s passionate interests in it. This has been recognized by observations of a number of evaluation reports of the Programme Evaluation Committee.

The second approach was articulated in the Intensive Agricultural District Programme (IADP). This concentrated on providing and unleashing intensive efforts for enhancing improved agricultural production and productivity in these selected districts. This programme was an offshoot of and dovetailed with the new agricultural strategy of the mid- sixties which later on came to be looked upon as the ’Green Revolution’. The fundamental weakness of this programme was that while it augmented agricultural production, it also gave rise to a sharp imbalance along regional lines and also between different stratas of the peasantry.

And the third stream which is currently in vogue is the approach which has come to be recognized as the Integrated Rural Development Programme. The main features of this Programme consist of a direct anti-poverty approach, multi- functionary and integrated nature and combine simultaneous initiatives in many directions. In the main this Programme underlined the need for improving the overall conditions of the ’marginal man’ – the rural poor. It naturally had certain associated programmes like the Training Rural Youth for Self-Employment Programme (TRYSEM) and Development of Women and Children in Rural Areas (DWACRA). This approach is supplemented with and reinforced by Jawahar Rozgar Yojana (JRY) and its component streams like Indira A was Yojana (IAY) and Million Wells Scheme (MWS). The JRY combined elements of infrastructure development in rural areas and wage employment. While this third stream in the official approach towards rural development appears to be more relevant in meeting the objectives of the new emphasis which the concept of rural development in the contemporary context has assumed — that of eliminating rural poverty, it suffers from the basic shortcoming that we have pointed out earlier.

The IRDP approach is being sought to be implemented with other long term development programmes which seek to optimize the potential of land, water and other bio-resources. These are the Drought Prone Areas Programme (DPAP) and Desert Development Programme (DDP). Apart from these there are two other Programmes which aim strengthen the human and physical infrastructure in the rural areas. These are the Rajiv Gandhi Drinking Water Mission of the accelerated Rural Water Supply Programme and the Rural Sanitation programme. The allocation for these Programmes are also supplemented from the Minimum Needs Programme (MNP) there are also special plans and sub-plans for specific groups like tribals or people in the hilly areas.

Another new feature of the official thinking is to involves the Governmental Organizations (NGO) to implement certain programmes through the Council for Advancement and Promotion of Rural Technology (CAPART). The difficulty with this approach is that once the elected panchayats come into full play these organizations’ activities can come into conflict with those of the panchayats. Already there has been quite widespread allegations about many of the NGOs which have been funded by the CAP ART pointing out that many of them exist only in paper.

It appears that the investment of Rs. 30,000 crores for rural de­velopment in the Eighth Plan is a major campaign plank for the Government. But when one sees that, the rate of increase in allocation in this sector is less than that of the overall Plan size, ie, the percentage allocation for this sector in the Plan has actually decreased, one can call the bluff that the Government is indulging in.

What is really important in this respect is to find out what is the quality of the delivery system? And, more importantly what is the impact of the investment in terms of meeting the basic objective of rural development — poverty alleviation? The census and the NSS data available with us do not tend to show that there has been any appreciable change in the magnitude of rural poverty. Apart from the basic shortcoming of the orientation and implementation of these Programmes, specific problems are also showing up in a very big way. One of the major problems pertain to the non-availability of adequate and appropriate rural credit. For example, one of the major schemes of the ongoing rural development activity — the IRDP involves a massive credit component. It is seen that the commercial banks which is a major contributor towards lending for the IRDP has an outrageous performance with their entrenched anti-poor orientation. The ceilings for the project cost also in the context of the current grim price situation also makes a particular project inviable in the first instance. And then it becomes a vicious circle. As the project is unviable the beneficiary is unable to repay the credit and the poor rate of recovery a stigma against any further credit for the schemes. I clear that even by the admissions physical achievements do not show any great increase if not stagnation.

The corruption at different levels is also a major impediment towards the registering of any positive impact in commensurate with the investment for such programmes. ’

It is incumbent on the democratic Kisan and Agricultural Workers Movement to take up demands flowing from the manner of implementation of the ongoing rural development programmes. It is needless to say that there is a tremendous potential for mobilizing broad sections of the peasantry—in particular the rural poor in these struggles. The experience of these can on the one hand strengthen the unity and sense of achievement on the basis of whatever achievements may be scored. On the other hand, it can raise the political awareness about the iniquitous nature of the power structure in the rural area which is the major hurdle to ensure the avowed goals of rural development. Printed at Progressive Printers, Shahdara, Delhi-95 (Ph: 2282847)tion and the release of a new array of dazzling luxury goods in the Indian market, and the consequent consumption of those has curtailed saving. The saving will decline further if the recommendation of the Narasingham Committee to prune unprofitable branches of state-owned banks is fully implemented. O