“WHAT governments gave out with a flourish they often took away by stealth.” Wrote William C. Thisenhusen, summing up his study of agrarian reforms in the Third World in general and Latin America in particular. (Thiesenhusen, 2001) This has been precisely the case with the Left Front regime, as the first two sections in the present article revealed. They also brought into focus the growing domination of upwardly mobile middle and rich peasants and the corresponding state government policy of “betting on the strong” — the trusted bourgeois strategy of relying on and supporting these sections for agrarian development and stability. From these findings we now move over to a study of the LFG’s second generation reforms (“our second phase in agriculture”, as Buddhadev Bhattacharya told Ananda Bazar Patrika, 12 May), about to be introduced after the first set of reforms ran into a blind alley.

When the Union Budget 2002 advocated further liberalisation, commercialisation and corporatisation of agriculture and recom­mended contract farming and corporate farming as the best roads to prosperity, all sections of the Left denounced that as the latest instance of shameless surrender to the WTO. They were particularly angry with the Centre’s pressure tactics : state governments were promised liberal aid packages if – and only if – they took the prescribed path. The CPI(M) in its 20th West Bengal State Confer­ence said :

“The WTO actually works as the watchdog of developed capi­talist countries and strives to expand the markets of their agricul­tural products. It is asserting tremendous pressure on developing and underdeveloped countries, and the central ruling clique in our country has shamelessly surrendered to its dictates.

So, to resist the degeneration of Indian agriculture and to pre­serve food security and security of livelihood as the main pillars of democracy, the WTO dictated agrarian policies of the coalition government led by the BJP will have to be defeated. The 20th conference of the CPI(M) therefore calls upon all members, cadres and sympathisers to join the countrywide struggle against these policies ...”.

As if to ridicule the solemn call of the party’s highest organ in the state, a policy document prepared under the direct guidance of Nirupam Sen and Suryakanta Mishra – both central committee members and key ministers spearheading the perestroika of “im­proved left front” – asserted that the state government should take full advantage of India’s agreement with the WTO, restructure agrarian relations to that end, and work for agricultural develop­ment with this new approach. The “Draft State Policy Paper on Agriculture, Horticulture, Food Processing Industry, Agricultural Marketting etc. (2000-2007)”, drawn up on the basis of recommen­dations of Mckinsey International, (a US-based global consultant commissioned by the WB government) and tabled before the state cabinet on 21 May, echoes the Union Government’s agrarian policy in almost all respects (see box, where we have omitted old and usual directives like infrastructure development).

These recommendations combine general guidelines with spe­cific measures for particular areas, complete with a very business­like list of “Actions to be taken by Different Departments” (of the state government). To take one example, the government is asked to “liaise with Cargill/HLL over the next few months to finalise integrated projects and begin implementation.” The Cargill/HLL group, according to market survey conducted by McKinsey, intends to invest around Rs. 100 to 125 crore for domestic retail and export of high quality rice from West Bengal, provided they are allowed to engage in contract farming. Venkateshwara Hatcheries and Eagle Industries have plans to invest Rs. 15 to 20 crore and Rs. 20 to 25 crore respectively in the poultry business, but only on condition that “zero labour problem” is guaranteed to ensure continuity of opera­tions, which they claim is a must for this particular sector. Pepsi plans to invest Rs. 5 to 7 crore in fruit processing, but demands that the wholesale price of pineapple be brought down from the present level of Rs. 3.50 per kg to Rs. 2 to 2.25 per kg.


  • Thou shalt encourage farming of cash crops like oilseeds, cot­ton, fruits, flowers and vegetables, high price items like coco, va­nilla, cashewnut, spices, mushrooms, etc.
  • Thou shalt promote food processing and other agro-industrial units based on the above items, together with poultry, shrimp projects etc.
  • Thou shalt lure corporate giants to set up agro-related indus­trial/business units.
  • Thou shalt assist corporate investors to enter into contract farm­ing arrangements with farmers.
  • Thou shalt mobilise panchayats to mediate (and in case of dis­pute, arbitrate) between corporate houses and individual farmers engaged in corporate farming.
  • Thou shalt provide senior leadership-level assurance on “zero labour problems” in these agro-business units.
  • Thou shalt form a team to resolve critical labour issues like 7-days working week, provision of “an exit option” etc. in these units.
  • Thou shalt set up an agricultural export zone on central norms and promote export of high quality rice and other high-price items.
  • Thou shalt create agricultural databases and kiosks.
  • Thou shalt set up jute technology missions.


So on and so forth, runs the lengthening list of conditionalities of agro-giants, routed through their representative McKinsey. The Bhattacharya-Sen-Mishra triumivrate has already accepted most of these in principle, but junior partners of the LF have openly ex­pressed their strong objections. Agriculture minister Kamal Guha (Forward Bloc) was particularly angry because he was not taken into confidence in the preparation of the draft policy and he submit­ted an alternative swadeshi document. Abdur Rezzak Mollah, the land reforms minister belonging to the CPI(M) and a good section of the cadres and leaders of the party — particularly those associated with the peasant front have also expressed their anxiety.

And with sufficient reason, to be sure. The McKinsey report seems to be a procedural step towards obtaining big loans from international agencies like the ADB, which generally sanction loans on the basis of project reports from trusted international experts. But it is ominous that those who call the shots in the government readily accepted this as the basis for thoroughly restructuring the basic framework of agrarian policy in the state. It is indeed necessary to build up public awareness about the political implications of the LFG’s 25th anniversary gift to the people of West Bengal.

1. The proposed blanket ban on workers’ struggles in the agro-based units and export zones is an ominous sign for the left movement in the state. It is not important how many workers will be affected by this — the numbers will be small because the employment generating potential of these capital intensive units is quite low – what is involved is a basic question of principle. The very fact that the CPI(M)-LFG failed to straightaway reject the proposed abandonment of primary trade union rights acquired through more than a hundred years of bitter battle, speaks volumes for its total surrender at the feet of big capital. There is, of course, nothing abrupt about it. The CPI(M)’s opposition to ‘militant’ trade unionism is an old story, and with Buddhadeb Bhattacharya’s slogan of “investor friendly government” all types of labour movement have already become taboo. If the government now accepts this audacious proposal of MNCs, that will only be one more step in the long march backward.

2. As for contract farming, its advocates project it as a pro-peasant alternative to corporate farming. Is it really so?

Under corporate farming, a corporate house takes several thousand acres of land under medium or long-term lease (better known as captive land) and conducts everything from cultivation to process­ing to marketing under its direct supervision. For the peasantry this means immediate land alienation, which they are very much opposed to. In return they get a paltry lease payment and in some cases one job per family in the farm. The small holder thus becomes a wage worker on the land he nominally owns. The queer arrange­ment, however, normally remains stable for at least some years.

In the case of contract farming, on the other hand, uncertainty prevails from day one. Under this system the agro-unit enters into contracts with hundreds of individual peasants, “on the basis of mutual trust”, for the production of a particular crop having a definite quality (often the quantity is also pre-determined), to be purchased at a specified price (which is likely to be lower than the ruling market rate, cf the Pepsi demand for drastic reduction of pineapple price). The cultivator forfeits his right to select or change the crop and to sell the produce to the highest bidder. If there is any breach of contract in respect to quality or quantity, the company can sue him and demand damages, which in all likelihood he will find impossible to pay except by selling his land to the corporate house or to a wealthy farmer.

In many ways, contract farming is dadan system of the era of globalisation. The cultivator becomes absolutely dependent on the corporate house for the sale of his produce — but only to start with. Gradually he also grows dependent for fertilisers, imported seeds etc. (with local dealers in these inputs often becoming commission agents for the agro-giants), and may be also for cash advances. Since the big houses enjoy an “exit option” — a euphemism for a licence to sack workers or close shop at will without any social or statutory obligation whatsoever — farmers always run the risk of suddenly finding themselves without a buyer of their crop, a cash crop, which cannot serve their consumption needs either. The option of switching over to another crop at the end of the bitter honeymoon is likely to have been foreclosed by reduced fertility of the soil (caused by various factors including excessive use of fertilisers) and destitution of the cultivator. The (ex)-peasant who leased out his plot under corporate farming also finds himself in a similar situation when the lease contract is terminated. At the end of the day, at least for small and marginal peasants the two paths converge in ruin.

It is thus meaningless to try and select a better form of bondage. Under both corporate and contract farming, not only land but human resources too become captive to the agro-giant, for the bulk of the peasantry both are tempting gateways to devastation. Con­tract farming, however, has one distinct advantage over the other option. It is more deceptive (and therefore likely to be somewhat more acceptable to the farming community). This particular quality makes it the preferred choice of the LFG, the MNCs, and their common friend McKinsey. And it is the last-named which recently came up with the latest argument in favour of contract farming. The spectacular panchayati raj in West Bengal — they say — would intervene and save the small peasant if a corporate giant tries to grab his land. The MNCs which are known to be powerful enough to dictate and dominate national governments are thus expected to obey a panchayat body or a district magistrate! One deception leads to another, and the whole thing gets curiouser and curiouser.

3. The overall stress on export oriented cash crops is fraught with dangerous consequences. The threat to food security resulting from this shift has been noted even by Mishra and Rawal. Moreo­ver, the experiences of cash crop crises in Andhra Pradesh, Punjab and many other states — leading to mass suicide by farmers as well as series of massive and militant protest rallies — highlight the absolute necessity of proper safeguards to be adopted before we ask our farmers to take the plunge. But the LFG has not announced any practicable and effective measure on this question.

To discuss the new agrarian model in greater detail would be premature at this stage, because we do not know whether and to what extent it will really get going. If it does, that will (a) amount to a first step in a long process of the peasantry’s growing entangle­ment in the extremely uncertain, volatile international market, where only the fittest survive; (b) usher in a period of wider and deeper penetration of imperialist capital into agriculture and associated sectors, with devastating effect on the toiling classes; and (c) thereby further spoil the prospect of healthy, progressive capitalist develop­ment in agriculture. Social democratic betrayal has already come full circle, with the new policy in place it will move on the next higher spiral.