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Agrarian or Land Reforms

By | on February 20, 2014 | 0 Comment

Land reforms and imposition of tax on income derived from agriculture, which is presently exempt in majority of the countries like Pakistan, are two issues which attract a lot of attention in the print media particularly at the time of budget formulation. Eminent scholars and heads of advocacy groups are very vocal about the need for carrying out land reforms in the country to obtain efficiency and equity gains and make agriculture a dynamic sector of the economy. While imposition of agricultural income tax can be supported on equity grounds although an argument can be made about its practical application in the backdrop of peculiar socioeconomic realities of Pakistan, there are certain reservations about the land reforms which the advocates of land reforms unfortunately confuse with a related but distinct issue of agrarian reforms. Land reforms are essentially carried out to distribute lands, state as well as those confiscated from large estate holders, to the landless farmers along with some changes in the tenurial relations. Agrarian reforms, on the other hand, are meant to transform entire socio-economic landscape of the rural areas of a country by introducing fundamental structural and institutional changes in the political economy of a county’s agriculture sector. While the agrarian reforms are the need of the day, land reforms is an idea whose time has not come, rather gone forever in the face of several socio-economic cum political realities  and sheer technological imperatives.

None can deny the need for agrarian reforms to improve the quality of life of the farmers by providing them better legal and regulatory framework for sale and purchase of land, empowering the marginalized sections of rural society, gender mainstreaming, improving rural Infrastructure, altering the production relations by promoting cooperative and contract farming, rationalizing the role of the middlemen. Frankly all these are the issues of improving the governance in the rural areas and are not related to the land reforms as such. However, it is equating the all encompassing concept of agrarian reforms with a narrower concept of land reforms by some people which creates confusion at the conceptual and practical levels.

Historically land reforms have been carried out at the initial stages of the development process when agriculture is contributing more than half of the GDP of a country as it used to do in Pakistan uptill 1960s.Now it contributes around 20 percent of the GDP and is not a dominant source of wealth notwithstanding its overall economic importance. India did carry out, albeit at a limited scale, land reforms in its part of Punjab primarily to accommodate the Sikh migrants from Pakistan in the wake of partition. Time to do so in Pakistan was in the 1950s and 1960s when it started its planned development and land reforms could have been made a part of the overall planning process to carry out the needed socioeconomic restructuring of Pakistan. However we missed the bus due to nature of political economy of the country. Efforts made by the Ayub regime in this respect suffered from design flaws and implementation inadequacies. Same happened to those carried out by Bhutto for the same reasons. While the decision of the appellate bench of the Shariat Court has sealed their fate, the technological imperatives now demand quite the opposite.

Pakistan needs to push its technological frontier in the agriculture sector for enhancing the productivity of its agriculture sector not only to improve the quality of life of those in the rural areas of Pakistan but also of other citizens by ensuring their food security on the one hand and increasing the pace of its industrial sector, for which agriculture provides the raw material and much needed market, on the other. Both need an efficient, productive and profitable agriculture sector whose growth is sustainable and outputs are competitive. This is possible only and only if we increase the pace of farm mechanisation and technological innovation in all the agricultural operations. In order to introduce technology at commercial scale the size of the farms is the basic condition. If we redistribute lands and each farmer gets a parcel of land on which a tractor is not even economical, how we can increase our productivity?

Land reforms for the sake of land reforms or social justice are not a practical public policy option. Granted we can distribute state lands free of costs to the landless tenants and which every successive regime in Pakistan has been doing, we cannot redistribute private lands, confiscated or purchased, to landless farmers on moral grounds or as a sound economic policy. On what grounds you can confiscate the personal property of someone? If accepted on the grounds of social justice, then it should also apply to all sectors of the society without discrimination. Dare you touch the property tycoons, the industrial magnates, the commercial Mafiosi? Purchasing land from the big landlords as suggested by some learned authors at market price and then redistributing it to the landless farmers is a nonstarter, not possible to carry out by a financially bankrupt state

Agricultural transformation demands restructuring, not merely fine tuning, the political economy of the rural areas which are an integral subset of the overall economic structure of Pakistan. In this connection I will draw the attention of the learned advocates of the land reforms to some pressing issues needing greater attention of the government and the advocacy groups. Firstly there is a dire need of improving the agricultural terms of trade so that the squeezing of the peasants going on for the last six decades can be reversed. Rationalize the input and output prices and ensure that the farmers get fair returns for their efforts by improving the marketing infrastructure which at present squeezes the farmers and fleeces the consumers. Secondly, we need to enhance the productivity of the agriculture at micro and macro level by increasing efficiency in all agricultural operations through public as well as private sector investment in R&D, extension services, rural infrastructure, marketing, value addition etc. Unfortunately, the flow of investment funds towards agriculture, which has recently picked up, is still far below the desired levels. Thirdly, we need to make agricultural produce competitive in the rapidly globalizing world by reducing cost of production, improving its quality and meeting global food safety standards. Here the advocacy groups can make substantial contribution by raising the awareness of the opinion leaders and decision makers to enforce strict food safety standards. Fourthly, there is an urgent need to take adaptive and mitigating measures to ensure sustainability of the agriculture sector in the face of looming threat of climate change by promoting environment friendly good agricultural practices through creating awareness and promulgating legal/regulatory framework with adequate incentives and rewards. Last but not the least is saving valuable arable land from its conversion at alarming rates by the property developers and industrial concerns through pressure on the government to formulate a comprehensive land use policy.

Let me conclude that all the above mentioned challenges can be tackled only by treating agriculture as a pivot for bringing the needed productivity increase by promoting farm mechanization to reap efficiency gains, encouraging commercial farming through appropriate legal/regulatory framework, modernizing its marketing channels to ensure fair returns to the farmers and investing in R&D, extension and rural infrastructure. However it needs to be emphasized that the gains from this enhanced productivity be made available to all stakeholders without distinction. Urban areas do need good public goods and services but so do we.Visit any village of Sindh or Baluchistan, even South Punjab and see the deplorable conditions of roads, schools, hospitals and you can realise the gravity of the situation. Yes we do need reforms-agrarian, not land.

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