Social Scientist. v 3, no. 30-31 (Jan-Feb 1975) p. 76.


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76 SOCIAL SCIENTIST

consequence of the strength of this class which has grown during the period and remains unchallenged.

Of course, one could argue that the big landlords—however denned—have always been rating-class partners since independence: the failure of land reforms and the 'inability9 of the state to tax the rural rich are two examples that could be cited of the result of this partnership. This is true but it is only after 1967-68 that the farm lobby, backed up by large wheat surpluses, had been able to influence the price and credit policies of the government for creating an environment advantageous to the large farmer. It is in this sense that 1967-68 marks a turning point.

It is instructive to begin with what has happened during the last three years. By early 1972 the government had accumulated stocks of foodgrains to the extent of 7.88 million tonnes. This accumulation was in a large measure the result of high procurement prices offered during the preceding four years which saw a succession of fairly good crops particularly of wheat. The production of foodgrains during the agricultural year 1971-72 was about 105 million tonnes which was marginally lower than the previous year's record output of 108.4 million tonnes. Then followed a year of drought, 1972-73, when production dipped to about 95 million tonnes. The next year, 1973-74, witnessed a partial recovery with an esti" mated production of the order of 105 million tonnes.

Price Behaviour

Correspondingly, the wholesale price index of foodgrains, reckoned as an annual average on a calendar year basis, with 1961-62== 100, moved from 209.8 in 1971 to 237.8 and 280.9 in the next two years; the average of the index during the first six months of 1974 was 343.5. Thus a marginal fall in production in 1971-72 (by about 3 per cent) produced a 13.3 per cent increase in prices in spite of large stocks of grains held by the government at the beginning of the year and a fall by 9.5 per cent in production during 1972-73 resulted in an increase of 18.1 per cent in prices. The good crop of 105 million tonnes in 1973-74, partly made up of a bumper kharif harvest, did not bring about any fall in prices in 1974:

instead, the price index moved up by a further 22.2 per cent in the half year. These price increases, particularly the last one, apparently somewhat anomalous, have given rise to the talk about a crisis.

A succession of two bad harvests is by no means a new experience. It has happened before and not in the remote past although the euphoria created by the 'Green Revolution' may have blurred the time perspective at least for some. A comparative picture of these two periods with respect to the availability of foodgrains and government operations is given in tables I and II.

The impression of anomalous price behaviour during 1972-74 gets strengthened by this comparison : whereas net availability per person from domestic production alone was in the neighbourhood of 350 grammes per day in 1966 and 1967, it was 448 in 1972 (398 in 1973 and 430 in 1974).



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