`The crisis has been there for long'
Economist C P Chandrasekhar teaches at Jawaharlal Nehru University, New Delhi, and has authored several books on economic reforms. He speaks to Down To Earth on prevailing agrarian crisis
How do you interpret the recent dip in rural wage and slump in consumption in rural areas? These are symptoms of an agrarian crisis. While some of the trends are recent, the crisis has been there for long. However, it could not be felt for some time because of consecutive good or normal monsoons. Underlying the crisis are growing unavailability of crops, the collapse of public investment and lowering expenditure in rural India, and the turn to unsustainable practices of depending on farm loans.
This has occurred in an environment of liberalisation in which global trends and fluctuations have influenced domestic prices and the pattern of domestic production. The consequence has been a combination of increased volatility in production and rising rural indebtedness, which increase vulnerability.
As a country, do we have the resilience to tide over consecutive crop losses? Any shock that impacts production by constricting revenues earned by an al- ready indebted and cash-strapped peasantry threatens a collapse into bankruptcy. This spells disaster in an environment where social protection is minimal or entirely absent. Moreover, with state policy increasingly biased in favour of corporate and the government financing that shift by cutting rural development and social expenditures, the protection that the state had earlier offered in times of crisis has virtually disappeared. There is little space for resilience here.
Is rising rural debt a systemic problem or just part of a long phase of transition? If rural indebtedness increases at a time when the viability of crop production is under threat, the trajectory is unsustainable and the problem systemic. This is no process of "livelihood transition", though the peasant unrest it may precipitate could make it the trigger for policy transition or even structural transformation.