Land is in focus again. An initiative to eliminate the antiquated land revenue model, where ownership can be questioned by anybody and owners have to produce rights has been proposed. This was propagated in the late 1980s at the Gokhale Institute by Dr Wadhwa, known in India for his public interest litigation. The PM has rightly highlighted urbanisation as an issue for the National Development Council. This column has argued tiresomely that it is an important and ignored issue, in addition to the policy on agricultural land.
The contrarion mindset is an old problem. In 1989, the Planning Commission organised a seminar on land reform. The late VN Dandekar and I argued that tenancy should be regularised and were supported by Dr Wadhwa. This view was severely criticised by the doyens in the game. Dandekar and I retired hurt. The argument was, as in the Second Five Year Plan committee on land reform, that illegal tenancy recognition would mean that land to the tillers would be given up as an objective. Asha Swarup summarised the arguments as follows: ?The two policy options available are either to recognise tenancy, detect it and provide security of tenure to those actually cultivating land or to keep the original spirit of land reforms alive, whereby all intermediaries were eliminated and land rights, vested in actual cultivators.? The answer was ?the objective should be achieved by better implementation of the existing laws and a strict definition of ?personal cultivation?.?
In states like Karnataka, Andhra Pradesh and Gujarat, there has been great progress in validation and computerisation of land reforms. Recent NSS studies show that benami tenancies and reverse tenancies exist. In a village, typically around a third of the land belonging to small and marginal farmers is leased back to medium farmers. Farmers that lease, leave to work in non-agricultural jobs. The use of operational farm distribution data to test the hypothesis of reverse tenancy, is somewhat suspect. The NSS sample of cropping data invariably show, both at the conceptual and recording level, that the concept of ?operational holding? is flawed. It most certainly does not rest on the concept of own labour, which was always a criteria in ?personal cultivation?. Even a minimum use of own labour as a criteria is not present in operational holdings. A small difference between the distribution of ownership holdings and operational holdings is not an empirical argument that reverse tenancy does not exist.
Working models with stakeholder groups need much greater attention. Land scarcity is perhaps going to be the single greatest constraint for Indian development. Local bodies are the repositories of common resources. This problem is particularly severe in tribal areas. Those who work or live off of a resource are obviously the first to be affected and need to be consulted. We need to build models of cooperation. These are not simple matters and while best practice cases exist, we do not have working systems. The idea that land is not an economic good, which lies behind tenancy legislation, is irrelevant in practice. The greatest change that has taken place in rural India is that land is also being transferred voluntarily from very small peasants to middle peasants. Private organisations are expanding ground water exploitation and small water storage tanks in private plots have started. The economic interest in land and water has to be at the heart of any reform process. Groups of stakeholders can cooperate for well defined land development and water projects. Farmer level irrigation management systems, watershed development projects and groundwater cooperatives are all thriving and many more promising possibilities exist.
There are different agricultural diversification models. Amul is the classical cooperative. But corporates work with different models. Some work with producer associations of farmers, e.g. the DCM Harayali model. The central principle is whether the small farmer or the landless labourer?s will be a stakeholder in the institutional processes of organising agriculture. I believe that such stakeholder participation is efficient but I am sufficiently well trained in economics to accept that this is a concept of dynamic and not short-run efficiency. Even if distribution is corporatised, the need for policies to integrate informal sector distribution and artisan-based urban activities with super markets, followed by China, will arise. There is a clear-cut case for pre-empting urban land for the afore-mentioned purposes in the brave new world of the ?mall culture?. The FAO is correct in saying that the penetration of supermarkets in India is the lowest in the world. The National Commission for Enterprises in the Unorganised Sector is also correct in saying that the employment consequences of substitution of the distribution trade by the organised sector can be very large. At the very least, a strategic policy is needed to integrate the two.
The author is a former Union minister