An important demand of the present peasant movement is that the minimum support price of the crop or MSP should be given legal recognition. Peasants who produce crops for the market, especially rich peasants, have repeatedly taken to the streets to demand increase in MSP of various crops and waiver of loans. Now they are demanding this legal recognition of MSP as they have realized that the new agricultural law implemented by the Modi government is going to repeal MSPs and the system of buying food grains on the basis of it. No matter how much the government denies, it is true that in the coming days, the government wants to give up the MSP and the existing system of government procurement of food grains. It is very clear that the government has passed these three laws to hand over the agricultural sector to big domestic and foreign corporate companies. In fact these companies want that the price of agricultural crops should be determined by the market. No matter how much the market is considered to be an impersonal system, the fact is that it is not. Common masses, ordinary peasants, even small producers or small capitalists are just puppets or toys in this market - they must have to dance to the tune of it. But, those who have more capital in their hands, those who have monopoly capital, have the power to control the market to a large extent. As a result, the statement that the market will determine the price of the crop implies that the big corporate companies will principally determine the price. This will not be possible if MSP is applicable and government procurement of food grains at MSP prevails. As a result, the government will have to gradually phase out the MSP system or curtail its importance so that it does not affect open market dynamics.
The agitating peasants, realizing this from the outset, demanded that the entire system of MSP and government procurement should be maintained and that the verbal or even written acknowledgment of the government in this regard is not enough. The easier governments make promises, the easier it is for them to break it. That's why they want legal recognition of MSPs - which means the government has to buy crops at MSPs, and if it is purchased below that price, that would need to be declared as illegal and punishable. If a law is made in this regard, then no government can repeal the MSP by changing the law at their will. The government is naturally being obstinate because doing so means that not only the reforms that were taking place in the interest of big capital will get stalled, on the contrary, it will create a worse situation for them.
That is why the government and its allies - journalists, economists and other experts - are arguing against the demand of the legal recognition of the MSP. A strong argument of the government is that a very small portion of the peasants, only 6% of total agrarian population, and who are basically richest among them, can avail the MSP. The information stems from a 2015 report by a committee on the restructuring of the FCI, headed by the BJP leader Shanta Kumar, for which the report is popularly known as the Shanta Kumar Report. How did they get this statistics? In 2012-13, 5.6% of the total peasant households sold paddy and wheat to the government. Is it possible to say that only 6% of the peasants get the benefit of MSP from merely the data of sales of paddy and wheat only and that also of just one year, whereas MSP is applicable on 23 crops? These 23 crops include cotton, which is procured by the Cotton Corporation of India and a minimum price of sugarcane is also announced which is to be paid by the sugar mill owners, albeit they don't pay that price most of the time. But clearly, a greater number than 6% of peasants sell their crops at MSP through government procurement. But, even more important is the fact that even though the government does not procure the crops of all the peasants, when the government buys the crops in MSP, the price of open market crops also goes up, which benefits other peasants who are not selling their crops to government agencies. As a result, the statement that only 6% of peasants get benefited through the MSP is not true. The numbers of such peasants is much more.
However, there is no doubt that the crop is mainly sold to the government by rich peasants and capitalist farmers. Even if the price of the crop increases in the open market due to the MSP, the peasants who are in position to sell high amount of crops at a time are the main beneficiaries. Poor peasants, even medium peasants have fewer crops to sell. On top of that they borrow from local traders or middlemen and are so dependent on them that they are basically compelled to sell the crop to these local traders, or middlemen, at the price fixed by them. However, the government is shading crocodile tears over the plight of the poor or middle class peasants, and giving it as an excuse of virtually abolishing the entire MSP system; and in reality would be handing over the market of agricultural commodity to the big capitalists. If the government is so much concerned that not all the peasants are getting the benefit of MSP, then the government should collect the crops of all the peasants and sell the collected crops through government shops all over the country. Then the peasant will also be benefitted and the consumer will also be able to buy the crop at a lower price. But, how will the government do that? Then the hoarders and middlemen—the arthiyas-- will get extinct! Domestic and foreign big capitalists and big businessmen will not be able to make a profit by grabbing the crops of the peasants! Simply put, only 6% of peasants benefit from MSP - an argument the government is making-- is solely in the interest of big capital and not in the least in the interest of poor or middle peasants.
Secondly, it is a fact and the government is also acknowledging it, that the peasants are not being able to cultivate profitably. The cost of farming is increasing day by day, years after years. But, most of the time the peasants are not getting the price commensurate to that. It is even heard that the peasants are leaving the land uncultivated. That is why Modi has had to promise to double the income of peasants by 2022 and big committees have been constituted for that. All those committees have also prepared voluminous reports. It is often seen that the peasants are unable to cover the cost of cultivation with the price at which they are forced to sell their crops. In many cases, when there is bumper crop, the price of the crop goes down to such an extent that the peasant has to sell the crop at a great loss. That is, there is an inconsistency between the cost of crop production and the price at which peasants often have to sell their crops. But does the demand for increasing the MSP or for legal recognition of the MSP as a solution to this problem represent the interests of the working class and the toiling masses?
We have already seen that the rich peasants are the ones who are mainly benefitted from the increase in MSP or the entire current system of MSP and government procurement. Although poor peasants do sell some crops, they are net buyers of the crop - that is, they buy more than what they sell. And the agricultural labourers and industrial workers and other working people also have to buy the foodstuffs. Of course the rich also have to buy that, but their income is much higher and only a small part of that income is spent on it. On the other hand, the situation is just reverse for the working people, most of their income is spent on food. That is why it is natural that the price of food will go up with the increase of the price of the crop and its effect is mostly felt in the lives of the people of this section. If the MSP announced by the government is increased, it is natural that one of its effects will be reflected in the price of food and it will put additional burden on the working people including workers, agricultural labourers and poor peasants.
As a result, this method of continuously increasing the MSP to give a profitable price to the peasants is not the desired way for the workers-poor peasants-agricultural labourers and other toiling people; it is not in their interest. So, what is the solution to this problem? If the peasant does not make a profit by selling his crop, then how will they eke out their living? Can we tell the peasants that you sell the crop at a loss? It is clear that this cannot be said, or that no production can sustain in this way. For the majority of those claiming to be working class organisations, the only solution is to increase the MSP and it is beyond their realization that the MSP is against the interests of the workers and the toiling people at large. For that reason, they not only support the demand for an increase in MSP or a fair price for the crop without any hesitation, but they also frequently raise this demand in their own campaigns posing it as a demand of the toiling people. Some other organisations, however, appear to be compelled to acknowledge that there is a conflict of this demand with the interest of the workers and the agricultural labourers. So, in what way are they suggesting to resolve that conflict? They are also suggesting a solution to the conflict - increasing the MSP, giving it legal recognition on the one hand, and distributing subsidized food to the poor on the other. But, would this not virtually support the system of meager relief which is being run by the ruling class in order to sustain the system of exploitation of the poor? Can those who claim themselves to be communist revolutionaries make such a demand?
Why can't the peasants eke out their living by farming? Is it just for not getting a higher or 'profitable' price? Apart from the reason of not getting the price for not being able to eke out a living by farming, there is another big reason which the communist revolutionaries do not take into consideration. That is, the cost of farming continues to rise. Those who have the slightest idea about the problem of farming know how much the cost of farming has increased during this stage of liberalization. To tell the truth, the cost of farming has increased tremendously since the stage of the Green Revolution. There are two reasons behind this. First, the method of crop production which the ruling class had encouraged the farmers to follow resulted in increased use of hybrid seeds, chemical fertilizers and pesticides. In other words, the consumption of chemical fertilizers and pesticides in cultivation has increased a lot in comparison to the past. Second, the prices of fertilizers and pesticides have also multiplied due to the policy of liberalization of the ruling class over the last few decades. These are sold by various multinational companies and the way for their profits has been opened through this. Even the dominance of multinationals over seeds business has increased in recent decades. Many seeds have to be bought from multinationals every year and they are making huge profits from these seeds. In a word, the cost of fertilizers, pesticides, seeds and irrigation has increased a lot as a result of both increase in quantity and price. There are also two reasons for this, one is the massive increase in the exploitation of multinationals in agriculture, and the other is the policy of the ruling class to reduce subsidies on fertilizers, etc., which has been done in the interest of big domestic and foreign capital. In a word, the cost of farming has increased due to the exploitation of big capital. There is another reason behind the increase in the cost of farming. That is the exploitation of usurious capital. The government is forcing or enticing the peasants towards such profitable (commercial) farming which requires a lot of investment. Poor or middle peasants do not have the capacity to make that investment. Because of that, they have to arrange for the cost of farming through loan. However, even nationalized banks do not want to lend to poor or middle peasants. That is why they have to reach out to the usurious money lenders of the village. The peasants are compelled to borrow from them at high interest rates, and the cost of farming also goes up to meet the interest and principal of that loan.
Another important issue is, are the peasants getting that price or a commensurate price at which consumers buy crops or foodstuffs? The government has repeatedly said that the middlemen and brokers are eating up the profit of the peasants. According to the estimates of the government, only 30% of the price paid by the consumer reaches the peasants. The rest is usurped by middlemen, hoarders and stockists. The government is trying to let in big capital in the place of these middlemen, hoarders and stockists through this new agricultural law. If the big corporate companies can take overwhelming control of the trading of crop, they will remove a section of the old types of middlemen, hoarders, stockists and traders from the market. But, will the peasants get the benefits? Of course not. Large corporate companies will usurp most of the profits or, if possible, whole of it that the stockholders are currently usurping. Aren't they actually middlemen or brokers also? They are because they are selling the crops produced by the peasants directly to the consumer without themselves adding any value to it. But, taking advantage of the monopoly, they will buy at a lower price and sell at a higher price.
In other words, though the reason of being unable to bear with the cost of farming apparently seems to be not getting the price, it is not the real problem. The real problem is the exploitation of large domestic and foreign capital producing agricultural implements, the exploitation of usurers' capital and the exploitation of hoarders on the peasants. This will be accompanied by the further exploitation of big capital who would be involved in agricultural marketing or in trading of the agricultural crops. And on top of all is the government is protecting the interest of big capital by giving various tax exemptions to big capital, but not giving the necessary facilities to the farmers. The exploitation of these sections is not only harming the poor and middle peasants, but also hindering the growth of agricultural production or the improvement of agriculture in general. Because the profit these exploiters are making through exploitation is not returning back to agriculture. On the other hand, they are also grabbing away the surplus of the peasants from them; had it been in the hands of the peasants they could have invested in agriculture and improved agriculture.
However, the demand to stop these exploitations never came up in the movement of rich peasants. That is because even rich peasants are more or less involved in such exploitation. Many times the business of fertilizers, pesticides and seeds is run by them in the villages. They are even involved in usury. As a result, how could they talk about abolition of the exploitation that they themselves are associated with? That is why they have always demanded an increase in the price of crops from the government and are still doing so. The revolutionaries who are supporting this demand are, in the first place, practically supporting the burden of price rise on the workers, peasants and toiling masses. But more importantly, they are also covering up the exploitation of the peasants by large foreign capital producing agricultural implements, the exploitation by big capitalist as well as feudal landlords-non-agricultural owners, the exploitation by usurious capital and the exploitation by trading capital. If there is a demand to sell agricultural crops to the poor at low prices to cover up this exploitation, will it not in effect support the agrarian reform policies of the governments? Would this be appropriate for those who claim to be communist revolutionaries?
Therefore, the representatives of the working class can never support the demand for increasing the MSP or the legal recognition of the MSP or stand in favour of it. In fact, there is no solution to this problem in the present ruling system of the big capitalist and big landlords which can really solve today's problem in the interest of the downtrodden working people including the working class and also the downtrodden peasants. Toiling peasants in India are not only being exploited by big domestic and foreign capital, billions of poor and middle peasants are also being exploited by old landlords or non-peasant landowners, usurious capital, trading capital - along with domestic and foreign big capital. The policy of the ruling class for capitalist reform in the agriculture could not eradicate this exploitation, nor is it supposed to do so. The peasants will not be free from the problems of their lives without their liberation from this exploitation and it is not possible to eradicate this exploitation without overthrowing the present ruling classes from state power and seizure of power by the working class & peasantry under the leadership of the working class. This path is the path of agrarian revolution. Those who consider themselves revolutionaries today must face the question – what is the task of the revolutionaries today? Is it finding a way to resolve this problem by increasing MSP and saving the poor people with food relief? A way which cannot resolve the problem in any way, except further increasing the sufferings of all the toiling people, particularly of the industrial workers-farm labourers and poor peasants? Is it their task of selling dreams to the workers-peasants for a solution to these problems within this present system, or to bring this truth to the fore that there will be no relief from the problems of their lives without emancipation from the exploitation by non-peasant landowners, the exploitation by usurious capital, and the exploitation by trading capital, including the exploitation by imperialism and big capital? Whether they have managed to keep their revolutionary entity alive will depend on the answer to this question.
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