The Imperialist Offensive and Indian Agriculture

N. Bhattacharyya

It was the farmers of the Punjab and Haryana who led an agitation, blocked rail and road transport and compelled the government to order the Food Corporation of India (FCI) to purchase rice last October-November, 2000 at the minimum support price fixed by the Centre. The ruling state governments who are partners in the central National Democratic Alliance government ordered the FCI to agree to the demands of the farmers. Farmers in other states subsequently pressurised the Centre and the FCI had to again oblige. Taking advantage of the weakness of the Bharatiya Janata Party on the Ayodhya issue in Parliament, Mr. Chandrababu Naidu, Chief Minister of Andhra Pradesh, gained extra concessions by forcing the FCI to purchase ordinary rice at the price of fine rice. The sufferers were the cultivators of Bihar because Nitish Kumar, the Union Agricultural Minister from Bihar refused to open FCI purchase centres in his province. The real benefit did not accrue to the small and marginal farmers who account for 80 per cent of the total farming families of the country. As these producers are always in need of cash they sold their crop to wholesalers at the then lower market price which was much less than the FCI’s minimum support price. Subsequently these middlemen encashed the benefits of the agitation by reselling the crop to the FCI at higher prices.

The mainstream political parties agreed to implement the trade related policies of the World Trade Organisation (WTO) knowing full well that these instead of helping the Indian economy to grow faster would bring disaster to the entire economy in general and agriculture in particular. Agriculture and related activities in rural India provide jobs to around two-thirds of our total work force. The WTO’s game plan is specifically targeted against the interest of millions of small and marginal cultivators who are the vast majority in numbers but own hardly 43 per cent of the cultivated land area. To please the previous American President Clinton, who visited India in March 2000, the Government of India withdrew Quantitative Restrictions on 714 items out of 1429 items just before his visit and promised to withdraw restrictions from the rest of the items in March 2001, twenty-two months ahead of the WTO’s dictated date i.e. 2003. ‘True’ democrats in the Indian republic can only expect such loyalty to imperialists. Coconut, rubber, tea and oilseed and sundry other crop producers in south India in particular and in rest of the country in general are suffering huge losses due to unrestricted dumping of agricultural commodities from outside India. The problem will aggravate further when as per the WTO guidelines India will be compelled to import at least 3 per cent of its gross agricultural production. The Government of India as we saw on the quantitative restrictions issue is not a silent and indifferent spectator rather it is an active collaborator with the MNCs: they specialise in international production and trade in agricultural commodities and cannot expand without the destruction of our vast agricultural economy. Foreign wheat in an increasing quantity is reaching the southern ports as the rolling mills of south India find it much cheaper than that of Punjab and Haryana. Indian oilseeds producers are making distress sales as they cannot compete with the imported edible oil from Southeast Asia. This year the import bill for edible and non-edible oil will be exceeding Rs 10,000 crores and that will account for the third highest import bill after petroleum products and diamonds.


Since independence the main agenda of our mainstream political parties has been to appease their imperialist masters. They have completely surrendered to the imperialist institutions like the World Bank, IMF and WTO who decide and implement the economic policies of this country. There was never any attempt to seek public opinion on joining these institutions or to canvass public opinion on various issues concerning these organisations. The Indian ruling classes have taken for granted public support on these vital issues which concern the life and liberty of one billion people while pretending that India is the largest democracy in the world! The apex Chambers of Commerce e.g. CII, FICCI and ASOCHEM have stopped demanding a level playing field to compete in an imaginary market economy. All union governments since 1991 have surrendered to the demands of the agents of the imperialists by abolishing the licence and permit raj, drastically reducing the rates of both direct and indirect taxes, privatising the entire finance sector including the insurance and banking sectors (though they were never part of the WTO agenda) and offered so many other advantages to the MNCs that they had never dreamt of. The net result at the end of ten years of ‘reforms’ is clear and transparent to the entire world. Industries owned and operated by both resident and non-resident Indians whether big, small or tiny, producing both capital goods and consumer goods have either stopped production or are on the verge of sickness. The agents of the MNCs are advising our industrialists to get ready to survive in the competitive market economy, but where is the competition? The sharks of the west are well prepared to eat up all the local industrialists in one gulp so that they may enjoy among themselves the entire market of one billion people as monopolists. Fair or free competition is meant exclusively for the kids’ school textbooks. At least in developed countries they have some form of anti-trust laws. The Microsoft of Bill Gate was charged with monopolistic trade practices. Under the pressure of the World Bank and the IMF the Central Government has withdrawn the Monopolies and Restrictive Trade Practices Act (MRTPC) from the statute book and allowed the MNCs unlimited freedom in an unorganised market structure.

The entire organised wage earning labour force of the country which accounts for 8 to 9 per cent of the total labour force working in the north, south, east and west are on the streets demanding job security and employment opportunities. The MNCs want the complete withdrawal of all labour laws and want blanket powers of ‘hire and fire’. The anti-people decisions of the apex court to close down factories in the metropolitan cities are directed against the poorly paid factory workers in the name of pollution control but there is no urge to ban the motor car which is the main factor polluting the cities. The Supreme Court does not compel the governments to clean the sewage water before flows in the rivers. Slum demolitions and factory closures by the judiciary and the executive are directed against the poor and the weak and to help the land mafia and builders. The judiciary with other state organisations promoted by the ruling class of the country are helping the imperialist powers to comfortably settle down permanently in India and definitely not without considerations.

In the dictionaries of capitalism the stock markets are supposed to show the clear picture of a capitalist economy. Today there is a mad rush to get listed in overseas stock exchanges like NASDAQ and/or NYSE by many of our corporations. Official speculators treat these corporations with due respect. After the 1992 Harshad Mehta’s securities’ scam stock markets in India have refused to revive. The continuous downfall in international stock exchanges clearly indicate the recession which developed countries are passing through. The recent reduction in the interest rate by the Federal Reserve of USA and its promise to reduce it further in future clearly shows that the USA economy is on the sick list. Everyone knows that world economy is willingly or unwillingly tagged to the USA’s imperialist economy. Absolute command and control over the vast markets of India and China is required for the survival of world capitalism. The imperialists had never pretended that they have any concern for the welfare of the vast millions of poor in the colonial world.. Workers in the European Union, Japan, South Korea and in the erstwhile Asian Tiger countries are on the streets over the last decade demanding the opening of their factories and restoration of their lost jobs. After the 1997 debacle of the so-called Asian Tigers’ economies in south east Asia, the Indian market is flooded with goods and services at the lowest possible international prices which is technically called ‘dumping’.

Our steel, engineering, capital goods and a host of other industries have fallen sick due to uncontrolled imports. At the same time the developed countries are increasing the height of the protective tariff wall every day so that imports from the developing world are reduced substantially. The USA has an adverse balance of payment of more than US $ 450 billions. They are not importing Indian goods under the convenient argument of ‘dumping’. Those industries that are still surviving will be destroyed completely very soon by the unrestricted imports of manufactured goods from China. Let us ask our captains of industry and trade who hailed the Structural Adjustment Programme of the World Bank and IMF, why are they dumb and speechless today. Are they not happy after handing over the secondary and tertiary sectors of the Indian economy to the MNCs of the developed world. They have gained what their peers could not achieve through the ‘Bombay Plan’ at the dawn of independence.

It must be considered a big achievement for any civilised government in the world that MNCs are invited in India to process potatoes, tomatoes and corn. They procure the crops from the poor cultivators at the cheapest possible price and exploit them in that process and sell the finished products at exorbitant prices taking full advantage of the unorganised consumers in India. Macdonald’s and Kentucky Fried Chicken retail shops are crowding the Indian market while more than half the children in the age group 1 to 5 years in rural India are undernourished. Our governments do not care to discharge to their constitutional responsibility to supply safe drinking water to the people. The Supreme Court shows no concern to compel the governments to provide safe drinking water to the population. MNCs are allowed to earn fabulous profits by selling adulterated water under international brand names at irrationally high prices. The poorest section of the people is forced to depend on unhygienic water and compelled to suffer from waterborne diseases. Crooks and fixers have tons of black money but they don’t know what to do with this huge idle fund due to the lack of highly profitable avenues of investment in a recession-affected economy.

The imperialists are pressurising the weak central government to act according to its dictates and close down the public sector units and dismiss lakhs of employees. The puppet governments wish to oblige because each mainstream political party is waiting for the huge commissions which will be earned from the sales proceeds of public sector undertakings. What happens in privatisation and globalisation in a third world country is now glaringly transparent from at least one controversial power project in India. Enron, a notorious US MNC paid handsomely everyone concerned including the 13 day Vajpayee government. They took time off from the Parliament debate on the no confidence motion and signed the counter guarantee agreement on the Enron issue. After 2 years of the implementation of agreement, the Maharashtra state electricity board has stopped purchasing power from Enron because it is selling power at around Rs 8 per unit when the average cost of other producers in the state is less than Rs 4 per unit. The Maharashtra government is being pressurised by public opinion to review the Enron agreement immediately and has decided to stop payment. Even the American corporations are afraid of losing business in the third world countries due to worldwide recession. It depends on the Indian people whether they will surrender to such blackmail and threats from these international robbers. After ten years our experience of the Structural Adjustment Programme is that it is designed to exploit this country in a more cruel fashion than what the British did in their 200 years of colonial rule. The international corporations, the modern instrument of imperialism, have already taken up strategic positions in the Indian economy and the three international institutions of the World Bank, IMF and WTO are deployed both as watch dogs as well as blood hounds for their successful global ‘operation exploitation’. The world’s richest moneylender, the President of the World Bank, a paid servant of the G- 8 countries, was recently directed to go around the country specially to meet the Chief Ministers of the poorer states and to assure them that their begging bowls would be filled up with more and more US dollars. They have to place all orders for goods and services from the developed countries and from no other country. What is the role of Indian workers in such a challenging situation?


The MNCs are busy not only in destroying Indian industry, trade and finance, as they have done in other developing countries. They have already entered into our villages too where three-fourths of our population lives and about 65 per cent of our labour force. The rural people are on the warpath as the cost of production in agriculture is growing with each successive season but the selling price of the crops is declining much faster. This has resulted in the accumulation of huge debts even amongst owners of large areas of land in the agricultural prosperous states like Punjab, Haryana and western Uttar Pradesh. The rich peasants of Andhra Pradesh, Maharashtra, Karnataka and Tamil Nadu are also suffering from this ‘huge outstanding loan’ disease. Suicides by well to do cultivators are no longer news; rather their absence makes people surprised. In the seventies Indira Gandhi coined ‘Garibi Hatao’ the slogan of removing poverty to cheat people and ultimately it was the poor that suffered most and that resulted in her own downfall after ‘emergency’ in 1977. In the beginning of the 21st century, the World Bank has taken up the same theme of ‘poverty alleviation’ programmes and it is trying to implement this cosmetic activity through the anti-people chief ministers. The Prime Minister had to admit before foreign dignitaries attending the India Economic Summit 2000 held at the end of the year in Delhi that there are not less than 300 million people who in the language of the officials of the Planning Commission are ‘living below the poverty line’ (the unofficial figure is more than 500 million). In 1960-61 this number was merely 173 million. The United Nation’s Food and Agricultural Organisation’s report in 1999 (State of Food Security of World, 1999) stated that the figure of malnourished people in India is around 240 million out of the total malnourished people of the world of 800 million.

Nitish Kumar, Indian Minister of Agriculture, while placing before Parliament the first National Agricultural Policy after independence, spoke the same language that is used by the representatives of the WTO and World Bank. In the early sixties India faced food scarcity and tried to produce High Yield Variety seeds, fertilizers and pesticides to reduce its dependence on imported food. The USA administration discouraged India from producing more and it unloaded its substandard American wheat which was used for animal fodder. Today our FCI warehouses are overfilled: more than 50 million tonnes of grain are being stored against the economic holding limit of less than 20 million tonnes. The government refuses food to the hungry millions as they do not have any purchasing power. It allows millions of rats to eat a large quantity of this grain.

In the early 21st century USA warehouses are also overfilled with wheat, corn and soyabean produced by a few MNCs with the help of biotechnology. The USA biotechnology industry’s turnover is more than US $ 4 billion per annum. The entire developed world refuses to touch these food crops; even they refuse to use it for animal fodder. The UK Prime Minister, Mr. Tony Blair recommended genetically modified (GM) food to the British people but his own citizens refused to consume GM food and NGOs dumped tonnes of soyabean before his official residence, 10 Downing Street, for his own consumption. It is suspected to be dangerous even for birds eating these crops in the field where it is grown. The government of India has already allowed MNCs to produce such GM seed and cotton crops in different parts of the country totally ignoring protests both from our scientists and foreign scientists. Thus there is again pressure from the imperialists that India should go slow in producing more grain and depend on the MNCs for cheaper GM grain. Our cultivators and agricultural workers must understand the implications of such proposals and if this move is to be opposed it must be noted that there is a clause in the WTO agreement that we have to import a minimum of 3 per cent of our production from foreign countries. Our political leadership has to explain what they propose to do with our own agriculture and the people dependent on the agricultural economy.

The government of India has allowed USA MNCs having a monopoly in the agricultural industry such as Monsanto and Cargill to deprive our own farmers of their inherited intellectual property rights which have been handed down through generations of a hard and painful process of learning. Indian farmers are forced to depend entirely on foreign GM seed, fertilizer and pesticide producers who enjoy monopoly rights under the (Trade Related Intellectual Properties) TRIPs clause which was incorporated in the WTO agreement for their benefit and which is against the interests of the farmers of the developing countries. These international robbers deny our farmers their traditional right to use their own seed developed in this country and which now has been pirated. Thus our ruling parties irrespective of the colour of their flag have agreed with their masters—the imperialist corporations—that Indian agriculture including agricultural crop processing industries will be handed over completely to the MNCs.

The World Bank and IMF were ceaselessly trying to stop government initiatives in agriculture, industry, infrastructure and in the social sector since the days of independence and by the beginning of the 21st century they are particularly happy that the Indian ruling class in a bloodless coup has handed over to their imperialist masters a market of more than a billion population with its vast untapped natural resources and highly qualified efficient manpower. After the aggressive introduction of Structural Adjustment Programme in the early nineties, the main thinking of the Indian government is to balance the Budget and reduce the fiscal deficit. They know that to do this the government has to withdraw from all types of plan expenditures and that is why it has already stated that in future there will be no plan or non plan expenditure shown separately in the budget. The subsidies given to the social and productive sector will be gradually withdrawn under the World Bank directives.

In the rural sector our rich cultivators enjoy subsidised power, fertiliser, diesel and bank credit. The World Bank declares that there cannot be a free lunch for the well to do cultivators in India. But in the country from where the World Bank president comes—the USA, total government support to agriculture in 1999 was US $ 361 billions or 1.4% of the GDP, 80% of which was given to producers i.e. the limited number of MNCs engaged in cultivation. In addition further support is given to cultivators directly which the WTO calls ‘green box’ and which that is not technically treated as a subsidy and so is exempted by the WTO. Over and above this, an additional US $ 7 billions were given by the developed countries as export subsidy so that these MNCs can dump their agricultural products in the developing countries and thereby destroy the farmers and their livelihood. In the USA agriculture accounted for 2% of GDP in 1998 and hardly 2 million people out of the population of 272 million are engaged in agriculture. Agriculture is fully corporatised and mechanised. In the developed countries governments are allowed by the WTO to pay cash compensation to the MNCs for agreeing not to cultivate in a season.

Due to stunted industrial development in India there are virtually no jobs for our weavers, potters, blacksmiths, cobblers, fishermen and artisans who are living in the 5 lakh odd villages. Naturally the number of landless agriculture labour is increasing alarmingly. In the age of information technology there may be a scramble to print the ‘Prime Minister’s Musings’ by the press but nobody knows the exact number of Indian landless agriculture labour over a period of time. The Indian political parties refused to disturb the ruling class and never wanted to implement land reform laws. Land has concentrated over a period of time in to the hands of a few families in the villages. In 1990-91 1.6 % of the cultivating families owned more than 10 hectares of land and operated 17.4 % of the cultivated area while 59 % of households owned less than 1 hectare of land and operated 14.9 % of the land.

It is a fact that subsidies to Indian agriculture are insignificant. How long will the Indian government deny more subsidy to Indian agriculture in a globalised economy especially when 65 percent of the country’s labour is dependent on it and till today a minimum wage for agricultural workers—male, female and children is a foreign concept. The WTO cannot give eternal protection to the developed world and deny permanently the developing countries their right to export without any kind of hindrance from the developed world. The slogan that developing countries need not produce agricultural crops and that they can depend on cheaper GM crops from the developed world is misconceived. It is against the accepted policy of food security for the people of developing countries. It is high time that our poor cultivators and the millions of landless agricultural workers should unite and send clear warnings to the imperialists to keep from destroying our agriculture as they tried to do long back with our indigo cultivators.

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