“It’s the economy, stupid!” said James Carville, the famed campaign manager of Bill Clinton’s 1992 campaign, pushing Clinton’s presidential bid from what seemed like a overstretch for an unknown Arkansas governor, to a simple and graspable bid for the Americans.
An apt Indian spin-off would be, “It’s the agricultural economy, stupid!” Case in point being the 1989 general elections. Amidst the noise of the Bofors scandal (pun intended) the issue of the simmering farmers brought down the Rajiv Gandhi government with all its muscular majority to its knees.
Unfortunately, politicians often turn to short-sighted and populist solutions such as loan waivers, tinkering with trade duties and special packages, to answer the searching questions of farmers’ distress.
Who Is the ‘Marginal’ Farmer?
Recently, the dedication / acknowledgments section of MP and BJP member Varun Gandhi’s new book caught my attention. It says, “In tribute to India’s marginal farmer whose daily toil is as much an act of defiance as an article of faith”. We sure know the ‘farmers’ and their ‘issues’, or at least we think we do, but what on earth are these ‘marginal farmers’ now? To discover this ‘marginal farmer’, let’s go to a place where we can try and find easy answers to complicated questions – Bollywood.
The iconic scene from ‘Do Bigha Zameen’ (1953) where a gaunt Balraj Sahni runs his heart out with his rickshaw in an alien city, is forever etched in the Indian imagination. It is a story of a poor farmer Shambhu Mitra, who is forced to migrate to Calcutta to make enough money to save his land from the clutches of a powerful landlord. The story of the Indian farmer today is its slight variant; it is the story of ‘Do Hectare Zameen’.
The ‘marginal farmers’ hold a paltry stretch of less than 2 hectares of agricultural land per capita, and this category, along with the landless farmers, constitutes about 85-89 percent of the total farmers in India[1]. While the average Indian holds light monsoons to the weight of the loans, and from good fertilizers to bad irrigation responsible for farmers’ plight, the problem of access to land reveals the real rot in the system.
Why Land Holding Per Capita Has Been Pushed Down
Our founding fathers designed the Constitution and the early legislations to counter the feudalistic ownership patterns of agricultural land. Agricultural holdings were strategically divested from being concentrated in the hands of the few, by simultaneous deployment of land ceiling and redistribution laws, and abolishing tenancy in most states.
This democratisation of land rights did pay off dividends initially. However, due to population explosion coupled with outdated land tenancy laws, the land holding per capita has been progressively pushed down in India. Tenancy has been either completely banned or is extremely restricted. The antidote for inequity, the very anti-tenancy laws have made it impossible for these ‘marginal farmers’ to even lease the same formally.
Impact of Anti-Tenancy Law
Firstly, the ban on tenancy has led to ‘concealed tenancy’ or ‘oral tenancy’, wherein the owner and the tiller of the land enter into an informal understanding, wherein security of tenure is at the discretion of the owner of the land. In most states, continuous possession of land can accrue rights in favour of the tiller. The monster of losing one’s land forces the owner to end the informal leasing every 1-2 years to rebut continuous possession. Further, due to uncertainty in land tenure, farmers do not have enough incentive to make long term investments in a particular piece of land.
Secondly, the ‘economics of scale’ is elusive for a marginal farmer, as the land one possesses is not big enough to absorb the high component of fixed costs of mechanisation, including procurement of machinery, irrigation and electrification.
Thirdly, most of these “landless” or “less landed” farmers like Shambhu Mitra, have limited access to institutional credit (often being at the mercy of the village loan sharks[2]), insurance and government benefits.
Our Constitution May Have the Answer to Problem of Tenancy & Land Holding
Like all mature democracies, we should also look to our Constitution for answers. The legislative powers with respect to land leasing, is vested in the state governments. Recent interventions such as the Model Agricultural Land Leasing Act, 2016 devised by the NITI Aayog for the states to adopt has not made any progress, as the states tinker with the model law or completely revamp it, thereby defeating its purpose. It is about time the central government amends the Constitution to exclusively legislate upon and regulate agricultural land, and follow it up with a new central land tenancy law.
The uniform law should concentrate on securing the title of the land so that the owner is not worried about any kind of interest of the lessee accruing on his land.
The central law can also stipulate a minimum lock-in period of about 3-5 years for the tenancy to operate. The security of tenure for both parties will encourage them to make long term investments in the land.
The central law should also remove limits on the size of the land that can be leased, and should allow sub-leasing and land pooling. All of this together will take care of the ‘economy of scale’, by allowing farmers to access larger tracts of land and to spread the fixed costs better.
How to Ease an Overburdened Agricultural Sector
The central law shall also enable the ‘marginal’ farmers to access institutional credit using their tenancy rights, with the output as a collateral, somewhat like the receivable project finance funding. The farmer would be eligible for various benefits such as insurance and other support, as they would no more be an “informal tenant”.
Lastly, the central law shall also ease the over-burdened agricultural sector. In India, 55-60 percent of the workforce are agriculturalists, producing merely 15 percent of the gross domestic product.
Clarity on the title would also allow owners of the land to lease away plots without the fear of losing it, and would allow them to concentrate on other income avenues.
The ‘marginal’ Indian farmer has managed to hang on not because of us, but in spite of us; that’s his act of defiance. Every day he manages to pick himself up and hopes for some transcendental intervention which is his article of faith. He/she still is willing to give us a chance, election after election. Are we ready to reciprocate?
Citations:
[1] Situation Assessment Survey of Farmers, 2003, NSS 59th Round; OECD/ICRIER (2018), Agricultural Policies in India, OECD Food and Agricultural Reviews, OECD Publishing, Paris, last accessed on July 25, 2018 at https://doi.org/10.1787/9789264302334-en.
[2] Report of the Committee on Doubling Farmers’ Income, Vol. XIII, Structural Reforms and Governance Framework, dated January 2018.
(Pratik Patnaik is a lawyer and a constitutionalist. Fiscally conservative yet culturally liberal. A Delhi ‘yearner’ and a sucker for poetry. Wannabe policy commentator and an author of a best seller. He can be reached at @chiefdissenter. This is a personal blog, and the views expressed are the author’s own. The Quint neither endorses, nor is responsible for them.)
(At The Quint, we are answerable only to our audience. Play an active role in shaping our journalism by becoming a member. Because the truth is worth it.)