On February 28, 2008, addressing what was supposed to be the first Congress election campaign meeting, both Smt Sonia Gandhi and Dr Manmohan Singh alleged that the NDA government bore the entire responsibility for the miserable condition of farmers of the country. If Sonia Gandhi alone had said it one need not have had paid much attention to it. When her learned mentor Prime Minister joined the duet it has to be taken seriously without giving any benefit of doubt on account of transient illucidity. Who is responsible for the farmers? penury and poverty?
It is surprising that this question should come up 60 years after Independence, in the year 2008. Except for a brief period between 1998 and 2004 the NDA never had the power or the opportunity to cause detriment to the farmer or to the farm economy. The Congress party was in power throughout the post-Independence period. It will be difficult to believe that the NDA, in the short span of five years, undid so much good work done by the Congress party during its successive tenures.
The history of the misery of Indian farmers is, of course, much older than Independence. There is historical evidence to show that the Indian farmers and agriculture were about the most advanced in the world as a whole and that the immiseration of the farmers began from the setting up of the cash revenue system by the British. The farm community, till then, was quite capable of maintaining itself but did not produce the M-C-M-cycle Marx talks about. The first segment of the rural community to be affected were the village artisans who were completely wiped out by the inundation of the domestic markets by the cheap industrial goods and tools. It was the American Civil War, which put India, for the first time on the modern international agricultural trading map. The American Civil War made production of cotton for sale to the United States a highly profitable proposition. Railway lines designed to carry cotton to the port towns; ginning mills and even textile mills sprang up almost overnight in the western region.
The Indian city traders and the British merchants made huge profit by sale on to the Americans at very high prices and purchases of the Indian cotton at abysmally low prices. But, even these low prices made fortunes of regions like Vidarbha. Mahatma Gandhi was the first one to point out the skull-duggery of the British merchants and the Indian traders and devised his spinning wheel as an effective antidote to the British imperial policy. It may be recalled that it was amongst the textile magnates that one finds the most stalwart supporters of the freedom movement. They continued to dominate the Indian economy for years after the Independence.
At the dawn of Independence, the farmers nursed a hope that with the end of the British Raj the farmers would see happier days.
Alas! That was not to be! It did not happen mainly because Gandhiji'svision of a post-Independence Economy centered on villages and agriculture, centered on the villagers and cottage industries was thrown out practically overnight by the romanticist Jawaharlal Nehru who had allowed himself to be lifted off his feet by the performance of the Soviet Union. What Nehru succeeded in realising was an economy dominated by the public sector, giving the highest priority to the development of heavy industries. Pt. Nehru followed a dual policy of ruthless bleeding and benign neglect of agriculture. Cheap food was readily available for the asking as a part of the US food policy. So, it looked as if any expenditure on the high-cost Indian agriculture was not worthwhile. He was further influenced by the Stalinist tirade against the ?kulaks?. Secondly and concurrently, he followed a policy authored by Stalin and his acolytes. Under the name of a low-cost economy, it was decided to keep the agricultural prices low so as to provide cheap raw materials and cheap wage goods to the upcoming industry. Pt. Nehru did try to expand agricultural infrastructure by undertaking ambitious irrigations project and promoting cooperative institutions, on the Stalin lines, with firm belief that the farmers tend to produce the maximum that they can under a given environment of infrastructure and technology, irrespective of the economic incentives or lack thereof.
At the dawn of the Green Revolution there was a realisation that the agriculture was a losing proposition. Efforts were made to create an Agricultural Prices Commission that would guarantee the farmers a minimum support prices (MSP) during the days of harvest.
Unfortunately, Smt Indira Gandhi, Jawahrlal'sdaughter who succeeded him and had only superficial populist notions of socialism, found it necessary to move closer to the Soviet Bloc and their fellow travelers in India than her father would have ever approved. She made it a point to appoint left economists, traditional class enemies of farmers as successive chairmen of the Agricultural Prices Commission. All of them, without exception, raised questions and notions that would systematically deny farmers compensation for risk coefficient, land rental, domestic labour as also of domiciliary work of their womenfolk.
The Operation Flood was a typical project of the epoch under which Dr Kurien accepted the donations of milk powder and butter oil from European Union and used the combinant milk to depress the milk prices in Indian domestic market. The surplus derived was used to purchase plants, vehicles and equipment from the same European countries to transport milk from villages to the newly springing metropolitan cities. Dr Kurien, a food laureate was unrepentant of the fact that he took away valuable animal proteins from the diet of the rural folks. The villagers should make room with vegetable protein like pulses rather than consume expensive products, which were provided in the urban population, he maintained. This is classic example of the type of policy and became popular in the ruling circles in the days of the Congress regime.
The PDS system had become largely redundant as early as in the days of Rafi Ahmed Kidwai who wanted to abolish it. However, the strong vested interest of the Food Corporation of India (FCI) did not allow to happen so. The Essential Commodities Act was used ruthlessly to restrict agricultural exports and the development of agricultural processing and export. Throughout the Congress regime, the agriculture has been only nominally in the private sector. The government was the titular owner of the land under the doctrine of eminence juris and could acquire land from the farmers for little provocation and lesser compensation. This has discouraged for decades the agriculturists from investing any labour/money in the own sector. Further, the successive Congress governments kept the entire system of supplies of agriculture inputs under their own control. The so-called subsidies to the farmers were cleverly designed to benefit, in fact, the industry and the trade rather than the farmer. The electricity tariff, the water charges were similarly designed to look like subsidies to farmers but were, in fact, highly injurious. The agricultural research work was fully dominated by the government and was used to deny farmers access to technology developed elsewhere except through pipeline of the government. Nehru tried, in 1960s, to abolish private property in agricultural land and collectivise agriculture. Fortunately, Chakravarty Rajgopalachari and Choudhari Charan Singh defeated the coup.
Although Nehru did not achieve the dream of collectivised agriculture his henchmen did succeed in keeping Indian agriculture in a statist straitjacket. As early as in 1982, Rao Birender Singh, the then Central Minister for Agriculture, told the Parliament that the Government of India had to pay higher prices to the American producers of wheat because they had a higher lifestyle. Congress governments have frequently favoured even Pakistan farmers to keep the agricultural prices in India low.
And, the viciousness of the policies of Jawaharlal Nehru, Indira Gandhi and Rajiv Gandhi came out only during the Uruguay Round of the World Trade Organisation (WTO) when the Minister of Commerce had to admit that the Government of India imposed on the farmers negative subsidy as heavy as 83 per cent on an average. The most dependable estimate of the damage caused by successive policies of the Congress governments comes to Rs. 300,000 crore over a period of 20 years from 1980.
It is this heavy negative subsidy deliberately imposed by successive Congress governments that resulted in the indebtedness of farmers and, eventually, in their mass suicides.
The first phase of Economic Reforms launched by Dr Manmohan Singh in 1991 completely bypassed the agriculture. Even in his present avatar as the Prime Minister, the UPA Government has made massive imports of foodgrains, at prices almost twice of those in the domestic market, imposed bans on the trading in futures markets as also imposed a hefty tax on the commodity market transactions.
It would have been possible for India to save itself from the worst stipulations regarding access conditions and domestic subsidies under the World Trade Organization.
This is only a brief lead to any of the bad deeds of the successive Congress governments that militated against the farming community. If one were to add to the list of the tyranny?the cooperative organisations, the mischief carved by the differentiation between the small and the large landholders, ban on their entry into agriculture and confiscation of farmlands under the name of acquisition?the list would almost be indeterminable.
It really requires a lot of gumption, on the background of this dark history of the Congress party for Dr Manmohan Singh and Sonia Gandhi, to try and put the blame of farmers? penury on the back of the National Democratic Alliance (NDA) which barely had any opportunity to follow an agricultural policy of its own.