State Intervention and Foodgrain Prices
THE prices offoodgrains have risen at an unprecedented rate during the last two years. The phenomenon, described as an 'inflationary crisis' is being attributed to a variety of reasons such as the expansion of money supply, worldwide shortage of food supplies and the indirect impact of the rise in petroleum prices. These explanations ignore the reality of political power-relations in the country; a more satisfactory understanding of the crisis requires an examination of the role of the state in relation to the different social classes.
The word 'crisis' according to the dictionary means 'a turning point'. It is difficult to discover any such turning point in the Indian economy during the last two years: while it is true that in quantitative terms the current price rise is the highest in recent times it is doubtful whether it is the result of a sharp qualitative change taking place in the social and political processes. On the other hand, there are good reasons to believe that a definite turning point occurred during the late sixties. This was the period of the first phase of the so called 'Green Revolution' in the northern wheat belt. It was the point at which the state began to actively intervene to protect and further the interests of the surplus-producing farmer. It was then that the process of emergence of the big farmers as a powerful class began; the price structure today is but one