Meghnad Desai loves to cook, watch and write about old Bollywood movies and shuttles between London, Delhi and Goa. He pursues controversies on economics, history and anything else which catches his attention. He is also a British parliamentarian sitting in the House of Lords. He has written over 25 books, over 200 articles in learned journals and hundreds of newspaper columns in UK and India.
Out of My Mind: Bankrupt economics
Today agriculture is the sick man of the Indian economy. It has become a burden on the public fisc. Drug it with loan waivers and the crisis will recur and deepen.
Rahul Gandhi is riding high. He has won three elections. He has now challenged the Prime Minister to cancel all farmers’ debts or else spend sleepless nights. My sincere advice to the Prime Minister is to forgo sleep (even of just the four hours he has) but not agree to this ruinous suggestion.
Political attitudes are like old Bollywood films. They love cliches. Villains have moustaches and mothers are always full of tears. Farmers are forever poor. They are supposed to deserve our sympathy but even more the taxpayers’ money. If you are a low-income earner, as an urban worker or a struggling school teacher, do not ask for debt forgiveness. If you have a mortgage and cannot keep up with your EMI, do not expect your bank or the government to cancel your debt. Not even if you are an MSME producer. Politicians have no sympathy for you. Come back as a kisan and tears well up in their eyes and you get a cheque straightaway.
How has India created this monster of farmers’ distress? Time was in the 1960s when India had food shortage and there were two consecutive years of famine. American food shipments were a lifeline. This was the cost of the neglect of agriculture during the 1950s when the correct Left stance was to allocate money to machine-making industries. Any talk of supporting agriculture was denounced as Right-wing and reactionary. (I know. I was there.)
The consequence of following the Soviet-model industrial policy was Russian-style agrarian disaster. The Green Revolution was initiated. High-yield variety seeds from the Rockefeller Center were harnessed, with input subsidies and guaranteed prices for farmers who could produce marketable surplus. The Left said the Green Revolution was going to fail, that it would turn into the Red Revolution, that it favoured large farmers, that only wheat farmers benefited, that it would exacerbate inequalities, that rural India will go up in flames. As usual, the prophecy failed.
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