The current issue of Social Scientist contains a paper by the Editor analysing the political economy underlying the marked change in policy regime towards the 'retreat* of the State and towards economic 'liberalisation*, a change which started worldwide over a decade ago, and has reached India more recently. This is supplemented by specific discussion of the likely effects of liberalisation on the agricultural sector in India, in the three other papers. The latter question has acquired a particular urgency in view of the pernicious Dunkel proposals submitted to GATT during the ongoing Uruguay round of negotiations, proposals which have been rightly subjected to intensive criticism within this country.
The main thrust of the policy package making up *economic liberalisation* in the context of agriculture is to subject this sector to the free operation of international market forces. India is no stranger to this package, because for 158 years, starting in 1765, colonised India was the most liberalised* economy in the world, its producers confronting international prices without any protection. For another quarter century up to 1947 ours remained a substantially open economy with tariffs on a much smaller range of products than the USA has today. It is all the more surprising that the lessons of our unparalleled historical experience of being an open, liberalised* economy ^hould be so quickly forgotten by our policy makers. What India experienced was export-led retardation, under which her earnings from the second largest export surplus of any country in the world, went to meet 'indebtedness* to Britain; while the export surplus itself was achieved only by curtailing the per head consumption of the Indian population. Thus the per capita consumption of foodgrains declined during the half-century before independence in order that agricultural exportables could grow; this led to the creation of the preconditions for famine (which became a reality in 1943-44 in Bengal, subjected to the shock of deficit-financed war expenditures). The current economic liberalisation package implies nothing less than a recolonisation of the Indian economy and particularly its agricultural sector: and the main long-run implication is a destruction of foodgrains self-sufficiency in the interest of exports to the advanced world.
Social Scientist, Vol. 20, No. 11, November 1992