ISSN (Print) - 0012-9976 | ISSN (Online) - 2349-8846

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Capitalist Development and Rural Livelihoods

In Search of a Cohesive Development Approach

Indian agriculture has been facing intrusion of large capital into its domain in various forms, such as contract farming, industrialised agriculture, forcible acquisition of agricultural land for industrial plants. The impacts of such capitalist development on rural livelihoods are explored. It is argued that reform in agriculture—through setting up of special agricultural zones and other similar means—needs to be undertaken for further rural economic development, in general, and for protection of agriculture-related livelihoods, in particular. The prospects of the rural industrial sector are also examined and, in this context, it is argued that the clustering of rural non-farm enterprises can pave the way for an alternative development paradigm.

The author is thankful to K P Satheesan, Sarita Ranga and Pradip Chauhan for their assistance in drafting this paper.

The development policies of most of the developing countries have been premised on the conceptual framework that conceives development as a process of structural transformation from predominantly rural, agrarian and subsistence economies to predominantly urban, industrial and capitalist economies (Reddy et al 2014). In such a capitalist development process, agriculture is also being industrialised with the help of capital-intensive technology. While the industrialised agriculture can potentially augment the level of agricultural production, but at the same time would result in “an increase in the ratio of capital stock to land” and thus “[t]he livelihood outcomes of this process are, for many in the countryside, negative, as market imperatives and profitability requirements undermine the capacities of many small-scale farmers to compete on domestic markets” (Akram-Lodhi 2015: 235).1 On the other hand, the big industries largely provide employment to the skilled labourers. Thus, capital-intensive production process is not likely to follow the Lewis (1954) model and create large-scale employment opportunities for the rural, unskilled masses.

In India, while the agriculture sector’s contribution to the gross domestic came down to around 14% circa 2011–12, its share in the country’s employment was at 47.5% (Thomas 2015). This indicates that shift in output structure—considerably towards the software services led service sector—has not been significantly translated into corresponding shift in employment structure. With the surplus and unskilled agricultural labour force finding it increasingly difficult to be absorbed outside agriculture, it is inferred that the growth of the non-primary sector has not been much successful in offering possible solutions to the prevalence of underemployment—whether disguised or seasonal—in the agriculture sector, thereby forcing the rural workforce to migrate to other regions, and/or to engage in informal sector activities for a livelihood.

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Updated On : 5th Jul, 2019
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