India’s growing economy and the new economics - Open Evening Report

India used to have a “Hindu rate of growth,” at not more than 4% per annum. Rules put in place after the colonial era, ensured that the poor were not dispossessed. With such a large population in India, supporting the entire country required, and achieved, a miracle of equity.

Now, however, India’s growth rate has leapt from 4% to 9 or even 10%, and the key factor in this has been land. Following independence, land reform was India’s most important agenda. Small holders have been the backbone of India’s economy. According to GDP, however, their contribution has gone down to 12% of the economy. But this reduced figure is not because farmers are any less productive. In fact, GDP figures are not a function of genuine production, but of a global system that falsifies the economy.

Now Indians are facing new challenges posed by international companies, who are persuading the government to change the rules, to facilitate the corporate hijack of land.

In January, the Special Economic Zone Act created the opportunity for these new Zones to pockmark the country. Surrounding the cities, on the most fertile land, these Special Economic Zones are areas where the peasants are being dispossessed of their land, to make way for foreign-owned factory zones, where environmental laws, labour laws, and local democracy systems have no sway.

These developments have met with fierce resistance everywhere in the country. The huge international Indian conglomerate Tata attempted to create a factory zone in Bengal, but were stopped by peasants blockading access. Farmers have been shot, but they are still there on their land.

Navdanaya organised a convention for these communities, in which a Charter for Land Sovereignity was declared. This stated that land is essential for survival, belongs to those who till it, and is not a commodity for speculation. Before these developments, the ceiling for land ownership was 17 acres, but the average farm size is just 1 acre. Now, as a result of these new Special Economic Zones, 90,000 families are being excluded from their land.

This movement for land sovereignity and the defence of the peasantry is forcing the government to back off. An especially ruthless businessman from Indonesia called Salim, has found that the methods he used to grab land in Indonesia have failed in Bengal. In spite of his attempts to create conflict between Hindu and Muslim communities, by arming different sides, and taking advantage of the chaos to step in, the different communities have stood together and resisted the plans to turn the site over to chemical factories.

They have cut off all roads to the outside, even though 17 people have been shot in the ensuing disputes. Permission is required to enter, and due to their strong local economies and lack of dependency on oil, their agriculture and markets are thriving. It is, in fact, a prosperous region, with a diversity of food crops, cycle rickshaws for transport and clean water systems.

This resistance has spread across the country. Now 50 Special Economic Zones are stalled.

But big business is also pushing for changes in the law in other areas. Food has always been protected from monopolies. All the different regions of India have their diversities of local grains and vegetable varieties. But according to a World Bank report on India’s agriculture, this system of local, decentralised agriculture is “fragmented.” The diversity is a problem of “heterogenity”, and the locally adapted crops in each region are “shielded from competition”. Communities that eat their local varieties and not crops from the other side of the country are “penalised consumers far from source and harvest season.” The fact that India only exports 1% of its fruit, and mostly to nearby Asian countries, is also seen as a problem, when compared to Chile who export 80% of their fruit to all over the world.

The World Bank’s “solution” to these “problems”? To “shrink the distance” through refrigerated air freight, and to introduce one major player to create a “seamless supply chain”. That means Wal-Mart.

To consolidate the hold of the supermarkets and the food chains, major changes in India’s laws are now taking place. Street hawkers and street food sellers have been banned. The World Bank and Wal-Mart are seeking to export their oil-dependent food systems of refrigeration, packaging, distribution, electricity and air conditioning. But a supermarket-oriented agribusiness system will threaten the diversity of crops, and will push farmers off the land. This World Bank model would have India growing identical crops competing with the rest of the world, and leading to the loss of land, livelihoods and food security for millions.

Rural communities are not going to take this lying down. Navandaya is working with communities to continue to celebrate the diversity of different varieties of food, and it is the responsibility of communities like Totnes to do the same. By supporting our own bread, and our own freedom, we allow the other communities to do the same. Localisation and celebration of diversity must be the same common enterprise for us all.

It is not ethically given for us to be bystanders. We can solve poverty and climate change with these same actions across the world.

Summary – June ‘07

Schumacher College is part of the Dartington Hall Trust, a company limited by guarantee, registered in England and as a charity (company no. 1485560, charity no. 279756). Registered office: The Elmhirst Centre, Dartington Hall, Totnes, Devon TQ9 6EL, UK.