For an ‘am admi’ (common man) mentioned in the Common Minimum Programme (CMP) document of the United Progressive Alliance (UPA), the Central Government during its twenty months tenure could take only two important decisions and they are:

A) To collect annually some money through budgetary means called ‘education cess’ to partly finance basic and elementary education in view of the constitutional obligation towards ‘right to education’. However, the infrastructural facilities needed for schools are still a distant dream. The government schools of even the capital city are ready to collapse and the High Court had to intervene to order the Delhi government to undertake urgent repairs.

B) The Government passed recently an Act guaranteeing employment for one hundred days in a year to all adult members of such families who will ask for work. No one knows whether the Act will be implemented or not. To begin with it will be implemented in a few selected districts. One can go to court and ask for work for at least less then one third of a year and get something to eat, though there is no provision in the law to pay ‘minimum wage’, as many states don’t have anything called minimum wage.

The government claims that India has become a true super power and the Indian economy is growing very fast (7 to 8 percent annual growth in GDP). The present Congress-CPI (M) led Central Government (let CPI (M) be angry) is also shouting from the housetops that both India and China are not only economically very powerful but both are emerging ‘global powers’ in the east. If India is really an ‘economic power’ then why should Indian children in their millions have to supplement the earnings of their families by working in all types of odd and hazardous jobs virtually without remuneration? If it is a ‘great power’ as claimed by the political parties, then why even rich cultivators and master weavers are committing suicide every year not in one or twos but in hundreds. Debt-ridden farmers in Maharashtra are advertising to sell their kidneys to maintain their families as they don’t have any asset left for sale to sustain a living.

During the last one and half years the USA manipulated international petroleum prices through the OPEC and raised its price per barrel to as high as US 70 dollar from $17/18 in late nineties (speculation is that it may reach $80 per barrel) and this looted money mainly from poor countries is invested on USA soil. Without this artificial oxygen, USA’s economy to-day can be compared with any third rate economy either in Latin America or in Africa. Latin American oil producing countries like Bolivia, Venezuela, and Brazil etc. have challenged USA’s oil marketing policies.

The role of China since 1990s is of strategic interest to the imperialist countries. China is a member of the Security Council having veto power and it has also nuclear and other destructive arsenals which can threaten the existence of imperialist powers. It has the largest population in the world and its literacy rate is very high. It produces and sells defence equipment to a large number of developing countries. In this current fight against ‘monarchy’ in Nepal, China is continuously supplying arms to the King against all public protests. Economically it is the fourth richest country in the world and in many cases the cheapest exporter of goods and services in the world market. USA is worried as it can clearly read the writing on the wall that its days as the world’s only military power are threatened.

That may be one of the many well planned reasons why USA is instigating the false propaganda in Indian media that India is a ‘great country,’ it is ‘a super economic power’ after China and so on. We are the main purchasers from USA of the latest arms and ammunitions. We are also importing from Israel, a colony of USA and the only nuclear power in the Middle East, huge arms and equipment. L.K. Advani visited Israel when he was second in Command in the Vajpayi Govt. So Manmohan Singh’s Government too is forced to acquire the latest destructive arsenals. Our defence budget officially is a whopping amount of Rs 70000 to Rs 80000 crores though we don’t have money to provide mid-day meals to school children, for that we beg in the international market.

The so-called ‘green revolution’ packages imported from USA in the 1960s mainly consisted of costly machines, HYV seeds, a long list of dangerous pesticides, fertilisers and need for unlimited quantity of ground water involving very high investment from poor small and marginal farmers. Continuous investments in this venture have caused only the destruction and devastation of the rural economy. The National Sample Survey data says around 40 percent of villagers including rich and indebted farmers are so much fed up with farming that they want to leave their villages as it is difficult to earn any meaningful living. The prices of inputs are increased every day but the sale price of agricultural output has either remained stagnant or gone down. A study by UNCTAD (United Nations Conference on Trade and Development) states that a comparison of prices of agricultural raw materials and food and beverages in 2003 with 1980 prices show a drop of 60 percent and 73 percent respectively. Indian farmers are now competing globally and they are forced to accept lesser and lesser prices for survival. Can we ask General Motors, Wal-Mart or Coca Cola to sell products at 1985 prices in 2005? The drama enacted every year by the Food Corporation of India in purchasing surplus crop and increasing the minimum support prices by the Government is to help only the rich and affluent farmers of Punjab, Haryana, Andhra Pradesh and small area of western part of Uttar Pradesh. The farmers of rest of the country have nothing to do with this drama. So either this drama should stop or it should be made available to all farmers of the country. FCI over the years has become a haven of corruption to help a mafia of traders of agricultural products; these traders either extract payments without delivery or deliver sub-standard products and siphon off huge profits in collaboration with corrupt officials of FCI.

In late seventies only in West Bengal out of so many states half-hearted measures were taken to implement land reform. Farmers who actually cultivate land were given land rights. It was not completed to its logical end as many cadres of the ruling coalition refused to surrender excess land. Moreover, as the supply of inputs like bank credit, insurance, supply of unadulterated seeds, pesticide and fertilisers etc were not arranged, the entire exercise turned 360 degree in next decade and land went back to big land owners and village money lenders. To put a peg on the coffin of land reform all the Governments of the states including West Bengal have agreed that the MNCs and big Indian business houses will take over land from farmers on lease and decide what, how and when to produce crops as if they are new Zamindars of the 21^st Century. Thus many of the erstwhile big landowners are now working as paid labour themselves on their own land under the command of many MNCs working in agriculture, horticulture, floriculture, dairy farming and so on. These fly by night agri-contractors, are not accountable to any one, they have come for short term profit and they will disappear as and when that is achieved. Their orders to cultivate for commercial purposes only, without any type of agreement to retain the quality of the land and conserving underground water resources invariably will result in the conversion of fertile lands into permanent barren land and total loss of underground water reserve within a very short time. This is the experience where ever in the world these MNCs have gone, they maximised their own profit within the shortest possible period of time and left that area like locusts attacking fields full of matured crops.

The developed capitalist countries give millions of dollars as subsidy to their farmers.. But whenever subsidy to the cultivators and poorest of the poor is discussed, the World Bank and IMF say there can not be any ‘free lunch’. The UPA Govt. which never hesitates to give tax holidays and various subsidies and tax concessions to big business houses, recoils when the issue of subsidy to the poor comes up. They suggested reduced ration and increased prices in public distribution system.

What is more shocking is that the MNCs are allowed to experiment with their genetically modified seeds on Indian soil, the bureaucracy knows all this but the Indian people are made to eat such crops, vegetables and fruits without telling them that these may cause serious health problems.

In this discussion we have to mention as briefly as possible the devastating impact of WTO on Indian agriculture and the farmers. We have withdrawn quota restrictions on imports and brought down import duty to the Asean level. The result is that Australian wheat is cheaper at Chennai than that from Punjab. Coconut and rubber from south east Asia is cheaper in Kerala, so the farmers are jobless. During the last decade the Government spent crores of rupees on oil seeds Mission and when our country was trying to reach self sufficiency level in oilseed production, we opened the import door and our own cultivators are sitting idle. Most of the imported products are sold in India at below the cost of the producing countries and it is pure and simple ‘dumping’ to capture the vast Indian market. It destroys the livelihood of millions of our farmers. Politicians are profusely bribed by the agents of the foreign exporting MNCs and they look the other way. Thus the WTO as an instrument in the hands of the MNCs has destroyed Indian agriculture.

India’s share of world trade is less than 0.8 percent and by under and over invoicing our traders are cheating this country on the foreign exchange account during the last 60 years. The farmers are the worst sufferers in agricultural trade. During the NDA regime Government decided to export rice and earn foreign exchange. The following Table I will speak for itself.

(in Rs per quintal)
BPL: Below Poverty Line  APL: Above Poverty Line
Economic Times dated 31.12.2003

Such policy decisions were taken by the previous BJP Government in the Centre to enrich traders and these put FCI in huge losses. They had nothing to do with malnutrition and starvation deaths for the poorest of the poor, who can’t afford to pay even Rs 4/5 per kg for rice which is the main cereal for the majority of poor people in India. People below the poverty line may not have ration cards or if they have their ration shops may not have ration for weeks together. Quite often stocks released from FCI for export to countries like Bangladesh were actually sold within the country by the traders to profit from the high local prices.

Due to scarcity of foreign exchange our exports were undervalued and imported vouchers were fabricated to show artificial high values, the country got less foreign exchange by export and paid more for imports. Business houses kept accumulating illegally foreign exchange outside the country. Foreign Institutional Investments (FII) are pouring into Indian soil through fake companies registered in Mauritius so that they can avoid paying corporate tax in India as per agreement between India and Mauritius. A large number of them are actually repatriating Indian money parked in foreign soil to speculate in stock and commodity exchanges and in real estate business in India.

The poor people in the villages are demanding cheaper quality inputs including credit for agriculture and other activities but the entire financial sector of the country is just avoiding their national responsibility. We forget that vast population of the country still lives in the villages and the banks, especially the rich private sector banks, are willfully avoiding rural areas and concentrate entirely on giving credit to high risk brokers and speculators in the stock and commodity exchanges. It may be for the first time in the history of banking in India that for manipulating banking credit on initial public issue of shares and operating depository accounts for cornering shares, some banks have been penalised by the Central Bank. The amount of penalty is so insignificant that every one only laughs at such a national drama. The acquisition of Sahara Air by Jet Airways is shown as financed by banks, but these very banks can’t find enough money for the rural sector. During 1999 and 2003 public sector banks advanced to agriculture 14.7 % and 15.3 % respectively of net bank credit. For a detailed discussion on this issue let us consider the 59^th round of National Sample Survey – conducted on all India basis between January and December 2003. It is shown in the following Table II:

(Economic Times 5.5.05)

The above report said that out of Rs 1000 outstanding loan, Rs 577 was given by banks, co-operatives and the Government but the remaining amount came at very high interests rates from moneylenders. In states like Kerala and Maharashtra the share of loan advanced by moneylenders was less than 20 percent but in Andhra it was around 70 percent. According to this survey, the prevalence of indebtedness among farmer households was highest in AP (82 percent) followed by Tamil Nadu (74.5 percent) and Punjab (65.4 percent).

Do we have a shortage of bank finance or is it Government policy to destroy Indian agriculture so that surplus agri-products from foreign countries can be sold on Indian soil? Our study shows that the charge against the Government may not be unfounded. Let us look at the mind-boggling figures prepared by the Assets Reconstruction Company of India (Arcil), a public sector company, to realise the bad debts (NPAs) of the public sector banks.

a) Gross Non Performing Assets (NPA) of banking sector: Rs. 1,11,000 crores

b) Restructured loans to corporate sector that may turn into NPA any moment: Rs. 92,000 crores

c) Bad loans already written off during last 3 years: Rs 77,000 crores

(Economic Times 4.1.06)

This adds up to 16.5 percent of the Indian GDP. Add to this the unrealised tax which is more than Rs 98000 crores. This in effect is the hidden subsidy the banking sector and the government are giving to the corporate sector at the cost of the poor of this country. It is such diversion of resources that is resulting in the pauperisation of the peasants leading to the epidemic of farmer suicides.

This discussion cannot be complete without a reference to the plight of the tribal population. There are no statistics as to how many tribals in India were made homeless and destitute because modern development needed their homes, fields and their forest land. They are being deprived of their lands so that capital may have access to the bio-diversity resources, the precious forests, river water and minerals lying buried. However, recently things are not as easy as was thought a decade back. The present tribal youth in north east, central India and south India have got united and are asking the government for proper relief and rehabilitation packages.

Thus ‘economic reform’ in 21^st Century in India means clear and simple ultra modern cars costing some crores, beautiful roads and flyovers for their quick movement, five star malls and hotels in the metros for the affluent few. In the villages and in tribal heartland shops are selling human kidneys and human beings are forced to live days together eating weeds and drinking polluted river or pond water. It is high time Indians visiting places like Davos must understand that the time of endurance of the vast majority of Indians is running out very fast. Imitation of the west may be very costly unless proper corrective steps are taken in time. Numerically in a democracy majority always decides and the poor in India is in the majority, how long can we deny their natural right to decide the fate of the country!

31/1/06

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