Indian Agriculture-Capitalist or Pre-Capitalist?-Part One 1983


“ONLY an objective considera­tion of the sum total of the rela­tions between absolutely all the classes in a given society, and consequently a consideration of the objective stage of develop­ment reached by that society -and of the relations between it and other societies, can serve as a basis for the correct tactics of an advanced class.”-MARX

Existing class relations are the basis for determining the stage of development of society, while the mode of production is the basis for determining the class relations of society. “Now, according to the princi­ples of dialectical materialism any one system in general is composed of different aspects of which one is principal. The principal aspect of any system determines the essence of the whole.

Therefore, of the diffe­rent modes of production in India today, one necessarily pre­dominates over the rest. It is then that particular mode of production that determines the nature and stage of deve­lopment of Indian society as a whole. Further, depending only on this stage of develop­ment of society can the nature of the revolution and of the strategy and tactics to be adopted by the proletariat be determined. What then are the different modes of production in India? They can be broadly divided into two; Capitalist and Feu­dal. 1

In India 72% of the working population is in agriculture 2 while the percentage share of agricultural income in the net domestic product is 39.57%. This clearly shows that India is basically an agrarian country. Thus, it is the essence of the agrarian relations that will be the determining factor of the stage and development of Indian society. What, then, is the nature of agrarian relations in India? The CPI leadership believes that in Indian agriculture

…. feudal land relations have been curbed, statutory semi-feudal landlordism has been abolished in erstwhile Zamindari areas…..” 4 The CPM leadership maintains, “even though develo­ping in the capitalist way, Indian society still contains within itself strong elements of pre-ca­pitalist society”. 5. Also, there are certain “independent”’ Mar­xist scholars who make propo­sitions, such as “agriculture is characterized by complete or near complete polarization into two main classes, capitalist and wage laborers”. The three types of ‘Marxists’ have used different words for saying the same thing, the essence being, that the capitalist mode of production predominates over the pre-capitalist or feudal modes. Is this a fact?

In India, where there is an uneven development of economic, political and cul­tural forces throughout the country, it is neither proper nor correct to study any one particular locality and then generalize for the whole country. Likewise it is impossible to study each part of India with precise factual data. So we are confining our study to the mode of agricultural production in India as a whole, under the fo­llowing headings, which will pro­vide us with general indications as to the nature of agricultural production:

1) Land utilization,

2) Hol­dings,

3) Inputs,

4) Produc­tivity trends,

5) Credit,

6) Di­sintegration of the peasantry,

7) Market and

8) Utilization of surplus.


Under the capitalist system, land becomes a commodity, a form of capital, and a ‘money-ma­king machine’. In India nearly one-sixth of the cultivable land is not under cultivation and is lying waste, and only 18.43 per cent of the net area sown is cultivated more than once a year. 6 If cultivation was run on a capi­talist basis, there would be maxi­mum exploitation of the culti­vable land and the proportion of cultivable wasteland would not be as high as one-sixth, unless, of course, wastage of land was subsidized to maintain prices as in the US. Also in a country like the US, land is left fallow due to the conscious applica­tion of agronomy (i.e. systematic rotation of land utilization) while in India, where there exi­sts a food deficit and a massive surplus of cheap labor, it is basically due to lack of capital.


One of the revolutionary aspe­cts of capital is that it organizes and concentrates the means of production and labor, and thereby increases the productive forces, as well as social consci­ousness of the laboring masses. This is true of industry as well as of agriculture. In Indian agriculture, to what extent has this concentration taken place? This is lucidly brought out by tables I, and II given below. Taking first the question of ownership we find 35.23% own 2.07% of the land; 68.68% own nearly 24.44% of the land, on the other hand 2.12% of the lar­gest holders own.22.91% of the land; and 9.95 /o own 63.64% of the land. Turning to the operational hol­ding we find 32.88% operate only 3.36%of the land and 50.62% operate 8. 97% of the land. This indicates the predomi­nant existence of unecono­mical, small parcels of land, which is in direct contradic­tion with the general laws of capitalist development by which big capital tends to oust small capital. “Under capita­lism the small holding system, which is the normal form of small scale production, degene­rates, collapses and perishes. Such small scale production is compatible only with a narrow and primitive framework of production and society”: 9 Marx pointed out that the “pro­prietorship of land parcels by its very nature excludes the de­velopment of the social produc­tive forces of labor, social forms of labor, social concen­tration of capital, large-scale cattle raising and the progressive application of science”. 10 “Small landed property presu­pposes that the overwhelming majority of the population is rural and that not social, but isolated labor pre-dominates; and that, therefore, under such conditions wealth and develop­ment of reproduction, both of its material and spiritual prere­quisites, are out-of the quest, on, and thereby also the prerequi­sites for rational cultivation”.11 Bourgeois economists attribute this parcelisation of land to things like the “law of inheri­tance” (created by the judiciary) decline of the joint family sys­tem etc.

Marx emphatically reje­cted the idea that the judiciary prevents concentration of land, and reiterated that if capitalism exists, it transforms forms incompatible to it, to forms required by it by subordinating agriculture to capital. The basic cause for the existence of smallholdings is due to the poor development of a commo­dity economy in which need to own land becomes an abso­lute law. It is from this patch of land that the whole family attempt to derive their bare subsistence. Such a situation is an inevitable consequence of weak industrial development and limited commodity produc­tion in agriculture.

In an inde­pendently developed capitalist economy the small peasants would unhesitatingly sell their small uneconomical plots and migrate to the cities, which would absorb them into their industrial and commercial com­plexes. But, in India selling land amounts to selling employ­ment itself and hence the small holder is forced to, stick to the soil even though it is unecono­mical. So far we have dealt only with the existence of the numerous small parcels of land. But what of that top stratum of 2.1% who own 22.9% of the area? Have they accumulated this area in the process of “capitalist accumulation” or through the process of’ primitive accumulation’? Marx specifically distingui­shes the two processes of accu­mulation.

Lenin explains the latter as “the forcible divorce­ment of the worker from the means of production, the driv­ing of the peasants off the land, stealing of communal land, the system of colonies and national debts, protective tariffs, and the like”.T3 In India it is com­mon knowledge that such an accumulation of land in a few hands began two centuries ago through the usurpation of land stolen during and after the pro­cess of break-down of the village communities and through usury and mercantile activity14. Such usurpation and accumu­lation of land, comes under “primitive accumulation” not “capital accumulation”.

Also, had they expropriated land through a process of “capita­list accumulation”, the larger the size of the operational hold­ings the greater should be the efficiency of farming? But is this so of the large holdings in India? The Farm Management Surveys (FMS) shows exactly the opposite trend. That is, the larger the operational holding the lower is the efficiency of the farm15. Also in capitalist farming one would’ expect grea­ter sophistication in inputs with an increase in the size, but again the reverse trend is- apparent. And, finally with an increase in size of the farm there is a net drop in income per acre and in the investible surplus.

Lenin has categorically showed the reverse process of an increase in income expenditure and surplus with an increase in size of the operational holdings in any, developing capitalist ecnomy16. Coming now to tenancy, we find that the percentage estima­ted area held under tenancy and sub tenancy to the total area cultivated was 34% accor­ding to the 8th NSS of 1953.54. While according to the 1961/62 survey the figure was a mere 10.7%. And according to 1970-71 surveys it was 9.97%17. Besi­des this recorded tenancy there is an enormous amount of leased land held on the basis of oral or hidden tenancy right as well as a considerable area under share cropping, which may in fact, exceed the recorded area.

An Important factor here is, that the rent extracted from tenancy is very high— 50% to 65% of the produce; mostly in kind – with still higher rents in the fertile, irrigated areas. Under such burdensome tenan­cy and sharecropping, typical of feudal mode of production, almost all the surplus product is squeezed out by the landlord. {To be continued)


1) Here the term,’ feudal’ indi­cates the predominant preca­pitalist mode of production.

2) Census of India, 1971 Regi­strar general and Census commissioner

3)- Reserve Bank of India Bulletin,June.1979 and press Infor­mation Bureau; press note estimate of national product, savings and capital forma­tion, 1977-78-79.

4) Programme of the C.P.I.

5) Programme of C.P.M.

6) Directorate of Ecnomics and Statistics; intensity of agri­culture and irrigation. Indian capitalism in Brief. Sixteenth edition. Agricultural situ­ation in India, 1977.

7) National Sample Survey, 27th round. 8) Report of the National Commission on Agriculture, 1976.

9) Lenin, V. I., collected Works Vol. 11, pp 69 & 70. Small holdings with a capi­talist mode of production are exceptional as,in Japan.

10) Marx, Capital, Vol. 3, pp 787-

11) ibid, pp 792

12) Marx, quoted by Lenin in ‘Development of capitalism in Russia’, pp. 324 :

13) Lenin, Collected works, Vol. 21, pp 64. 14) see previous article in Peo­ple’s Power No. 3, p. 14

15.) Economic and Political Weekly, Aug. 1972, ‘Econo­mics of farm size and farm scale’, Utsa Patnaik.

16) Lenin,’Development of Capi­talism in Russia’, pp 150-54

17) Record of the National Commission on Agriculture, 1976


Vanguard March 1983

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