First, the rural scenario
Imagine you live in a mid-western town in provincial America. Public transport is unheard of. Without a car, you are going nowhere. You cant go to work. You cant go to the doctor. Your economic and social prospects are pretty much nil. Basically, without a car you are condemned to poverty. So you say, the solution is simple enough, go buy one.
But you cant. Not because there are ‘too many people competing for a car’. Nor because the license officials are ‘corrupt’. Its because you are simply not allowed to. The people who own the existing cars just wont let you. They think you are only fit to chauffeur and clean their cars, not own one yourself. They want you to be dependent on them, so they can keep exploiting you. Some of the lucky ones can repair cars, so they have a slightly higher status, but they cant own one. This is enough, however, for them to think they are ‘superior’ to you and destroy any solidarity you could have built with them to challenge the car owning classes.
Replace car with land. And class with caste. And you will begin to understand the nature of economic relations in rural India. A highly centralized economy, with land ownership, access to irrigation and electricity concentrated in the hands of a landed elite. And a mass population condemned to be labourers, with virtually no control of their economic lives. Note that the issue here is not the scarcity of land. India has the second highest area of arable land in the world after America1, and its warmer climate is much more suitable to farming than America. The issue is the distribution of land. After successive rounds of very feeble land reform, the only major change in India’s rural economy is the transfer of some land ownership from the upper caste Hindus to the castes just below them. Even 65 years after Indian independence, the vast majority of the most marginalized in India, the Dalits and Adivasis remain de facto landless2.
A very in depth, localized study of this situation is provided in Dr. Jan Breman’s (University of Amsterdam) book: ‘The Poverty Regime in Village India‘. Based on half a century of work in rural Gujarat, the book presents a penetrating account of the oppressive economic and social relations in south Gujarat, especially between the marginalized tribal Halpatis and the ruling Anavil Brahmin caste. Breman’s contributions cannot be covered in a single blog post, but I will summarize two key observations here, first from the book itself,
The idea of undeserving poor has taken root in the minds of those who are rich, more in these years of reforms. The rich, thus, neither feel guilty nor are afraid of any mobilisation by the poor in acute destitution because of the absence of solidarity among them. The result is that the landless, footloose rural proletariat lead a nomadic existence, following the seasonal, sectoral, and local fluctuations in the economy with occupational multiplicity.
From a review of the book in the Frontline magazine3,
The book shows that the expectation that the landless would leave the village seeking better life in non-agricultural and urban occupations and relieve pressure on land did not happen. On the contrary, it shows the irrational phenomenon of people having land acquiring skills and moving to lucrative non-agricultural occupations without leaving their hold on their land. The landless poor thus suffer “double denial”.
Rural India faces an enormously centralized and unequal economy based on agriculture, with virtually no non-farm employment4. Poverty and mass distress migration are natural outcomes.
The picture in metro India looks very different on the surface, but has the same underlying structure. After independence, India adopted a heavily socialist, state led path to industrial economic growth. Economic power was thus concentrated in the hands of bureaucrats who enjoyed state sanctioned discretionary powers, the few urban classes that were already moneyed due to the industrial expansion during colonial rule and the elite politicians, who formed the link between the moneyed classes and the bureaucrats.
The result was extremely slow economic growth rates and immense economic frustration among the newly educated classes. These new classes found themselves in an economy where they were neither able to start new economic activity, and were at the mercy of the business owning classes and bureaucrats despite their often superior skills. This drove the aspirational migration of the educated classes to the West (especially the US), where the freer market was better able to compensate and utilize their skills.
The 1990s brought a change in the structure of the urban economy in India. The dismantling of the infamous license raj opened the doors for the educated classes to create new businesses and the entry of multinationals has allowed them to access new jobs. However, it remains hard to start a business, and poor infrastructure continues to hamper the economic prospects of urban India.
On the other hand, the rural economy hasnt seen much change at all. Land distribution remains brutally unequal, and in addition the demand for land and other rural resources to fuel the economic expansion of the urban areas has led to further moves to centralize economic power in the rural context. Take for example, the recent move by the PMO to take away the power of approval granted to the village gram sabhas in matters of acquiring forest land, blatantly against the spirit of the Forest Rights Act5,
“The PMO-driven report required the environment ministry to change its August 2009 order—removing the clause that makes it mandatory for the state government to provide written consent from the project affected gram sabhas that all claims under the Forest Rights Act had been settled and that they approved of the diversion of forest land.”
India’s poverty is thus driven by extreme centralization of economic power. And this centralization is based on an unequal social and political contract between the ruling classes and the masses, not on any fundamental resource pressures or corruption.
2:”According to the draft paper of the Ninth Five-Year Plan, 77% of dalits and 90% of adivasis are either ‘absolute landless’ (own no land) or ‘mere landless’.”http://www.empowerpoor.org/backgrounder.asp?report=162
3:Anatomy of Poverty, http://www.hindu.com/thehindu/thscrip/print.pl?file=20080201506207600.htm&date=fl2502/&prd=fline&
4:”The dynamic rural nonfarm sector in China has been a major contributor to the country’s remarkable growth, while in India the growth in output and employment in this sector has been rather stagnant.” http://www.ifpri.org/sites/default/files/publications/dsgdp24.pdf
5: Diversion of forest land for industrial use may delay as environment ministry seeks time for consultations http://m.economictimes.com/news/politics-and-nation/diversion-of-forest-land-for-industrial-use-may-delay-as-environment-ministry-seeks-time-for-consultations/articleshow/18127015.cms