Indian agriculture and its contradictions
MEKHALA KRISHNAMURTHY
OVER the last year, the physical presence, economic place, and
political magnitude of Indian farmers and farming have occupied the national
capital region and preoccupied national public debate in a truly extraordinary
manner. The ensuing polarization has also brought to the surface some of the
most deep-rooted and deeply felt contradictions of agrarian economy and society
in contemporary India.
The conflicting
perspectives that define this moment are well known but bear repeating. At the
end of 2021, with the Union governmentÕs repeal of the three farm laws, the
historic farmersÕ protest has been heralded by many as a lifeline for a
battered democracy and broken federal compact. But this same show of collective
strength has been vilified by others, who view the entrenched political economy
of agriculture as the most regressive roadblock in the way of economic
progress.
In the
meanwhile, in fields, villages, towns, and cities across India, over these many
months of the Covid-19 pandemic, it is agriculture and agricultural produce,
especially basic foodgrains, that have served as material lifelines for
millions of citizens. During this prolonged crisis, existing systems of public
procurement and distribution, with all their infirmities, have been mobilized into
action, and have even expanded to an extent. They have provided vital support
to farmers and basic sustenance to the poor.
While the
coverage has always been inadequate and many remain excluded, survey after
survey indicates that basic food relief has reached millions in need and public
procurement has registered record volumes and offtake.1 But the very same source of economic and
social protection that has secured this vast buffer stock – the
paddy-wheat centric Minimum Support Price (MSP) and procurement regime and the
public distribution system (PDS) – has also long been at the heart of
policy contention as a fiscal drain and driver of agroecological distress.
Yet more is at
stake than a question of surplus grain. During this period, Indian agriculture
also reprised its vital role as the oldest and most absorptive ÔspongeÕ for
surplus labour.2 In
2020-21, bolstered by a good monsoon, agriculture was the only sector of the
economy to grow at 3.6 per cent amidst a devastating economic contraction.3 As millions of workers returned to their
villages and to the fields, the share of total employment in agriculture saw a
perceptible rise. The data from the periodic labour force survey (PLFS) tells
us: of the 46.18 million additional jobs generated between 2018-19 and 2019-20
nearly 70 per cent of them are reported to have been created in agriculture. To
put it in figures, this represents an estimated 32.72 million additional
agricultural jobs compared to only 1.65 million in manufacturing and 3.58
million in construction.4
But the slow
growth of agriculture and the meagre incomes that it yields for the great
majority of agricultural households mean that for many this immensely
absorptive sponge also appears to be an inescapable swamp, impeding IndiaÕs
structural transformation.
Lifeline and roadblock.
Social security system and agro-ecologically destructive drain. Sponge and
swamp. When it comes to agriculture, no matter how stylized, idealized or
crude these descriptions might appear, each undeniably also represents a grain
of truth. Most importantly, even as they are all too easily framed as
oppositions, their coexistence arises from deep and dynamic entanglements that
have evolved over long periods of time and across very different agrarian
regions, each with their own histories and relations.
The problem is that there is little interest
or effort in understanding the genesis of agrarian arrangements and
entanglements, investigating their moral and political foundations, and
analysing the reasons for their persistence or transformation in different
contexts. Instead, the approach to agriculture is at once heavy-handed and
deeply indifferent to actually existing conditions. This is exemplified by a
battery of laws, policies, and schemes that by design end up simultaneously
over-determining and undermining the vast and varied field of social,
economic, and political life known as agriculture and those who depend upon it
most deeply.
Take the case of
agricultural markets. On the one hand, the state imposes strict legal
definitions and schematic terms and conditions that at best ineffectively
regulate the innumerable kinds of exchange that take place in primary markets
and provide farmers little protection against the multiple forms of production
and market risk that they constantly confront. At the same time, the state
firmly resists making real public investments in building accessible
agricultural institutions and infrastructures that would address the actual
structural constraints and exploitative conditions that small producers face
and that reduce their bargaining power in primary commodity markets. This also
effectively restricts the access of small and marginal farmers to whatever
public support (whether that is in the form of agricultural credit, irrigation,
subsidies, regulated markets, or MSP procurement) the state declares, yet only
makes sparsely and unevenly available with disproportionate concentration in
only a few regions and crops.
Moreover, when faced with rising commodity
prices, the general response of governments has been to take idiosyncratic
decisions by passing blanket orders and imposing temporary controls, usually to
the detriment of farmers. On top of all that, there is a penchant for
inflicting sudden, state-directed shocks (demonetization and the national
lockdown being the most recent examples) that pay little heed to the complex
linkages and interlinkages that keep essential agricultural produce in motion
and sustain the millions whose livelihoods depend on these systems to work.
In such a
context, the answer cannot be to drastically deregulate and get the state out
of the way. For the Indian state has never really materialized where, and in
the ways, it is needed most in the first place. It also cannot be to intensify
ham-handed state control over diverse and complex agricultural markets. Both
would in fact only extend the status quo and deepen the very
contradictions that are playing out. And it most certainly wonÕt be achieved by
pushing the blame onto a particular Indian region or group of farmers by
holding them responsible for the woes of all other farmers, consumers, and
taxpayers, refusing thereby to acknowledge and accept the histories and
legacies of state and public action – and inaction – that have
brought us to where we are today.
In Ill Fares the Land, the historian
Tony Judt writes: ÔThe problem is not whether we agree or disagree on any given
piece of legislation. The problem is the way we debate our shared interests.Õ5 Much has been written about the way in
which the farm laws were bulldozed through Parliament and the lack of
consultation with state governments and the public on central legislation that
concerns, in critical respects, subjects that are firmly in the domain of the
states. Much has also been written on the deep design flaws in these acts when
it comes to serving the basic public purpose and larger public interest of
state regulation in agricultural markets.
But now, after
the repeal has been secured on the back of a year-long struggle by the
protesting farmersÕ unions, perhaps it is this question, about the ways in
which we debate and deliberate upon our shared interests that we must most
seriously reflect upon. For surely there are few spheres of life and human
activity where our interests are more deeply shared and more fiercely contested
than in the field of agriculture.
At its heart are
fundamental questions about the social, economic, and political arrangements
that we, as a society, accept and put in place to govern the resources and
relations involved in the production, exchange, processing, distribution, and
consumption of food, fodder, fibre, and their by-products. Markets have long
been vital to these economic arrangements, but non-market structures and
exchange relations – households, kinship, caste, gender, religion, and of
course, the state – have always been part of the workings of
agro-commercial systems. Moreover, when it comes to markets for agricultural
produce, and most especially for staples, different groups of people have also
historically demonstrated a great capacity to resist the seemingly unstoppable
forces and infinite possibilities of commodification and marketization.
Indeed, there is a long historical record,
across time and place, expressing personal pain, class or group-based protest,
and popular outrage at the prevailing conditions in grain markets in times of
distress. These expressions, whether they manifest as violent riots or
non-violent protest or simmer away as deeply felt resentment, reflect
grievances that operate within a historically and contextually specific
consensus – what E.P. Thompson, writing about volatile local markets for
grain and bread in 18th century England, termed the Ômoral economy.Õ6
At any given
time, this consensus is built around a collective understanding of what
constitutes ÔlegitimateÕ and ÔillegitimateÕ practices in marketing and the
Ôproper economic functions of several parties within a communityÕ tied together
by specific crops and their commodity forms.
When a ÔreformÕ
appears to one or more of these groups as a fundamental re-arrangement of those
Ôproper economic functionsÕ and therefore threatens the basis of a consensus
that has prevailed, despite numerous challenges, for over half a century (as is
the case of mandi-based MSP procurement for paddy and wheat in Punjab
and Haryana), the state, as we have seen this year, cannot easily get around
the resistance by soiling protestors with the label of Ôvested interestsÕ. But,
now, having been forced to concede the repeal, the most likely response is for
the state and its leaders to retreat back to a deeply problematic status quo.
Is there, then, a better way to approach our
shared interests? Given how fundamental and complex the issues are, one thing
is clear. Filling the newspapers with competing fiscal reasoning amounting to a
few lakh crore or terrifying trillions of rupees is not the right place to
start when it comes to questions about balancing and aligning our approaches to
basic food and nutrition security, agroecological sustainability, and the
livelihoods of millions of citizens. This is especially true in a society that
is still composed of a vast number of small-scale producers and an even larger
number of extremely vulnerable, poor consumers, including among them the
producers of food.
These citizens
would of course be the first to tell you how much expenditure matters. But a
deliberation on the nature and extent of public support needed by those who
produce food and those who are too poor to afford a basic, nutritious diet for
their households cannot begin with the trading of fiscal estimates.
It also must not
begin with declarations of the historic freedom and liberation of Indian
farmers whose lives remain quite fully absorbed in the daily negotiations of
multiple constraints that ensure weak terms of engagement in asymmetrical
markets. Here again, farmers do not need theoretical lessons on their own
agency or on the powers of market competition. But a more grounded and serious
understanding of existing local market relations and the presence and absence
of different forms of state intervention might be a more helpful place to
start.
Yet, this is also precisely where the truly
difficult problems for public policy and state intervention become most
evident. Here, as with so much in Indian life, instead of clear breaks and
transition pathways, let alone a textbook structural transformation, we have
enormous diversity, the coexistence of institutional forms, persistent
partialness, overlapping roles and relationships, and the presence and
interaction of multiple scales of activity, most of which it seems remains
small enough to defy expectations or merit close observation, except as large
statistical categories.
Consider for a
moment how common distinctions that we make between ÔinputsÕ and Ôoutputs,Õ or
those between Ôcash,Õ Ôcredit,Õ and ÔkindÕ or between ÔsubsistenceÕ and
ÔcommercialÕ cultivation are dissolved, reconstituted and interrelated in
routine agrarian exchange.
Depending on varying conditions,
part of this seasonÕs harvest is retained by farmers as next seasonÕs seed;
stored, processed, and preserved as food; or mixed and made into fodder for
livestock. The harvest may also be divided (under a sharecropping arrangement),
stocked (in anticipation of better prices or held back for contingencies), paid
out as wages for labour, relinquished as repayment of a loan, sold in the
market directly to a local buyer or via a commission agent to a more distant
one, or may be procured by a public agency.7 The harvest from a single farm invariably
travels along multiple routes. All the while, in vivid and microscopic
movements, people, animals, implements, technologies and the elements
constantly move on and off the land. Their timing has great bearing on market
activities as part of seasonal scrambles to mobilize the money and materials
needed to keep farming on track and the social and political calendar ticking.8
Agricultural
produce, once purchased, moves in and out of commodity form, often as gift or
tribute, distributed as welfare entitlement or emergency relief, deducted as a
customary fee, payment, or tax, diverted as bribe. The by-products of primary
commodities, in turn, are also constantly commodified and generate their own
circuitry and sites of exchange, trade and distribution. To give just one
example, in the rice cluster in Arni, Tamil Nadu studied over decades by
Barbara Harriss-White, husk has been commodified as a fuel; rice bran is traded
as an intermediate good in the solvent extraction industry; broken rice is fed
to cattle and consumed by some people, while de-oiled bran cake is used as an
ingredient in livestock feed.9 When it comes to agricultural
commodities, such complexity and specificity is generic.
While producers and consumers tend to be
acutely aware of wholesale and retail prices, the interlinkages that keep
agricultural commodities on the move remain largely invisible. In recent years,
however, two massive, state-imposed nation-wide events – demonetization
and the lockdown – each coinciding with a peak post-harvest marketing
season (kharif 2016 and rabi 2020, respectively) have
inflicted widespread disruption and damage on IndiaÕs agricultural markets.
Suddenly, under
extraordinary conditions of enforced illiquidity and immobilization, ordinary
yet vital people, places and things – labour and buyers, mandis and
warehouses, gunny bags and transporters, cash and credit and much, much else
– began to fall short, shut down, or go missing altogether. As a result,
the myriad interconnections and arrangements, formal and informal, that keep
our agricultural and food systems going every day came to be – at least
partially and temporarily – visible. The costs of such delayed
realization have been severe. At the same time, IndiaÕs agricultural production
and marketing systems, stretched and fragmented as they may be, continue to
demonstrate remarkable resilience and responsiveness.
And so, with this unfolding interplay of
diversity, distress, and dynamism, we return to the contradictions with which
we began. In the end, Indian agricultureÕs absorptive and adaptive capacities
are in large measure a continuous response to the dominant structures and
conditions of production and consumption. These are characterized by
persistently small and tiny farm sizes on the one hand, and by the determinants
of domestic demand and consumption in an economy with a vast number of poor and
low-income households, on the other. It therefore requires enormous material
and intellectual exertion and endless feats of coordination at all levels,
especially by those directly involved in the production and provisioning of
food, to simply keep things going.
In such
contexts, as we have learned from field research across diverse states,
districts and agricultural commodity networks, the presence of Ômany
intermediaries at multiple levels is less a sign of market inefficiency and
more a rational responseÕ to particular regional structures and conditions, in
which such actors play vital roles in local and long-distance market networks.10 This is not to imply that intermediaries
do not exploit farmers when opportunities arise but to make the rather more
basic point that the opportunities for exploitation arise not because
intermediaries exist but because farmers are in structural relations that
weaken their terms of exchange in primary markets.
With or without
the farm laws, it bears repeating, that for the vast majority of Indian
farmers, especially for small and
marginal cultivators, such exchange still largely takes place in villages and
local market sites without any public regulation or support to enable better
price discovery, oversight or risk management for small producers.
Finally, it is here that the dilemmas of
diversification, both on and off the farm, are most palpable and perplexing.
For some time now, the grand goal of diversification –of crops, diets,
and livelihoods – has been held up by virtually everyone as the only
solution to the intertwined crises of agro-ecology, farmersÕ incomes, nutrition
security, and economic development in India. But there is little discussion on
the actual dynamics of diversification, consolidation, and scale in
agro-commercial systems. As a result we avoid a critical public debate on the
very different processes of market control and competition, accumulation and
income distribution, and ultimately of political power that may emerge
depending on the stated – and unstated – vision about how such
diversification is to be achieved. This is exactly where the stakes are the
deepest.
We know, for
instance, that in India it is actually the smallest and most externally
under-resourced producers – small and marginal cultivators, many of whom
grow food for their own subsistence, often in remote, rainfed regions –
who have the most diverse cropping systems and marketing arrangements. But they
are also the most dependant on wage labour and other non-farm income to try to
make ends meet.11 Generally,
the farmers who have managed to accumulate, at least for significant periods of
time, are medium and large mono-cropping farmers, especially
in regions that have received public investment and assured market support for
major foodgrains and cash crops. The agroecological, economic and the political
consequences of a conscious Green Revolution strategy of Ôbetting on the
strongÕ have long been clear. But there is nothing straightforward about
redesigning state intervention and support to redress these persistent
imbalances.
On the other side, while small-scale and
itinerant intermediaries engage in seasonal aggregation and low-margin trade,
it is the larger regional agro-commercial and agro-industrial firms that are
the most diversified in terms of their portfolio of activities. These firms
tend to exercise greater market power in their dealings with both sellers and
buyers and are able to extract higher margins from storage, processing, and
trade. They also have greater access to formal credit and are major financiers,
operating through both formal, but largely informal rotations of cash and
credit. At national and global scales, conglomerate capital in agribusiness is
even more fully and formidably diversified, including in integrating backwards
from retail operations and with large investments in inputs, storage and
logistics.
India is
currently living out the realities of distress-driven diversification. At the
same time, different interests are both aggressively pushing and actively
resisting the promise and perils of diversification via corporate
conglomeration and consolidation. General statements about farmers collectives
will not resolve the fundamental tensions here: after all, cooperatives and
FPOs can emerge as major agribusinesses (like AMUL) or serve primarily as local
aggregators for large-scale private sector corporations. Much will depend on
who and what public policy imagines is the real Indian private sector, the
nature and extent of public investment poured into them, the regulatory
frameworks that support or marginalize them, and the institutional capacities
that are built over time.
Historically, of course, it is above all, the state that has held the greatest powers of diversification and consolidation. Indeed, this remains the ultimate source of support and the looming spectre of fear over the future of Indian agriculture, and of everything else. Any debate about our shared interests and collective purposes cannot bypass the state or avoid the thicket of contradictions and competing interests that will need to be constantly negotiated and balanced. If the farm laws and farmersÕ protest remind us of one thing it is that there is no way to do this without openly declaring and debating the moral assumptions and social histories that underlie our approach to market forces and state intervention. And then to approach agricultural fields and markets with renewed conceptual clarity, grounded empirical engagement, and substantial and well directed public investment.
Footnotes:
1. Harish Damodaran, ÔHow Food Has Become the Real Social Safety Net in PandemicÕ, CPR Understanding the Rural Economy Series, 11 June 2021, https://cprindia.org/news/9841
2. Barbara Harriss-White, ÔMore Than One Kind of Farm Protest is UnfoldingÕ, The India Cable, 15 January 2021, https://www.theindiacable.com/p/the-india-cable-many-kinds-of-farm
3. Harish Damodaran and Mekhala Krishnamurthy, ÔCan ÔRuralÕ Play Saviour Again? Agricultural Seasons and Covid-19 WavesÕ, CPR Understanding the Rural Economy Series, 4 June 2021, https://cprindia.org/news/9808
4. Harish Damodaran and Yamini Aiyar, ÔEmployment U-turn: Rural India is IndiaÕs Main EmployerÕ, CPR Understanding the Rural Economy Series, 6 August 2021, https://www.cprindia.org/news/9953
5. Tony Judt, Ill Fares the Land. The Penguin Press, New York, 2010.
6. E.P. Thompson, ÔThe Moral Economy of the English Crowd in the Eighteenth CenturyÕ, Past and Present 50, 1970, pp. 76-136.
7. For a recent example of a detailed field-based examination of the diversity of primary markets sites and systems, see Shoumitro Chatterjee, Mekhala Krishnamurthy, Devesh Kapur & Marshall Bouton, A Study of the Agricultural Markets of Bihar, Odisha and Punjab. Final Report, Centre for the Advanced Study of India, University of Pennsylvania, Philadelphia, 2020. https://casi.sas.upenn.edu/agricultural-markets-study
8. David LuddenÕs An Agrarian
History of South Asia provides us with a remarkably vivid and detailed
description of these two great seasons of cultivation and circulation across
agrarian and territories. Cambridge University Press, Cambridge, 1999.
9. Barbara Harriss-White, ÔLocal Capitalism and the Development of the Rice Economy 1973-2010Õ in Barbara Harriss-White (ed.), Middle India and Urban-Rural Development: Four Decades of Change. Springer India, New Delhi, 2016, pp. 97-130.
10. See S. Chatterjee, M. Krishnamurthy, D. Kapur & M. Bouton, op. cit.
11. Harish Damodaran, Mekhala Krishna-murthy and Samridhi Agarwal, ÔAgricultural Households and Farming Income: An Initial Analysis of Variations in Income from Farming and Other Sources Among Agricultural Households in IndiaÕ, CPR Understanding the Rural Economy Series, 30 September 2021, https://cprindia.org/news/agricultural-households-and-farming-income-initial-analysis-variations-income-farming-and-other.