Lok Sabha Elections 2004

Campaign Booklets

 Under BJP rule

 Rural India in Crisis

‘India lives in villages’ said Mahatma Gandhi. While the rich are certainly shining in Vajpayee’s India, what about the real India — the villages?

The BJP-led government’s policies have forced more than 20,000 farmers to commit suicide, while in more than 20,000 villages people of die of hunger. More than 5 million small and marginal peasants have lost their holdings and joined the army of unemployed. Hundreds of peasants sell their kidneys to pay back their loans.

Credit cards without credit availability and ration cards without public distribution system is the prize given by the Vajpayee government to poor farmers and agriculture workers of India. We have become dependent on imports even for items which were grown abundantly in the country. The farmers who provide food to the country are starving, while crores of tons of foodgrains lie in stocks held by the central government. At the same time, the government exports foodgrains at a highly subsidised rate. Exporters of rice and wheat received more than 800 crores as subsidy from the government in recent years at a time when 5,000 children die of malnutrition every day and India is home to one-third of the world’s hungry population, estimated at 840 million.

The per capita availability of foodgrains has come down from 177 kg. in 1993–94 to 153 kg. a year — almost the same level of consumption that existed at the time of Bengal famine in 1943, which occurred because the then British rulers resorted to large scale exports of wheat and rice from India.

Women in rural India, who form the majority of landless workers, have faced the major brunt of the policies of the Vajpayee government Even today they are denied equal wages and property rights.

Costlier Inputs

The savage cuts on subsidies on seeds, fertilisers, irrigation, electricity, diesel, etc., by the BJP-led government has led to a massive rise in the cost of agricultural inputs and this has led to a steep rise in the cost of production.

The price of diesel has more than doubled since 1998; the price of urea has gone up from Rs 3,680 per tonne in 1998 to Rs 4,830; the cost of DAP has risen from Rs 8,300 per tonne in 1998 to Rs 9,350; and NPK prices have risen from Rs 7,500 per tonne to Rs 8,060. It has already been pronounced that the after the general elections urea prices will be de-administered, which would push the price to around Rs 8,000 per tonne.

The new Electricity Act 2003 proposes to do away with subsidies and cross-subsidies. This will hit the domestic and agricultural sectors the hardest. The share of these sectors in total power consumption from grid electricity has been increasing, and stood at 52% in 1999–2000. The consumption by the agriculture sector was 17,218 million kwh. in 2000–2001 and received a subsidy of Rs 27,000 crores. The new Act is going to remove this subsidy. The tariff charged to agricultural consumers had increased from 12 paise/ kwh in 1991–92 to 28.5 paise per kwh. in 2000–2001. After the removal of this subsidy, electricity tariffs for the agriculture sector are poised to rise manifold.

The Electricity Act 2003 is also designed to help private players — both Indian and foreign — take over the assets of State Electricity Boards at a pittance. Because of the consequent increase in electricity charges, 12.51 million pump sets, which use electricity for lifting water, will be affected.

Removal of Quantitative Restrictions and Falling Farm Prices

While farmers bear the burden of rising input costs, their incomes spiral downwards. The Vajpayee government’s ‘Shining India’ campaign talks about increased Minimum Support Price for agricultural output in the last five years. What the campaign does not say is that while the government did announce the MSP, it stopped procurement and left farmers at the mercy of private traders. The BJP-led government also deliberately delayed the announcement of the MSP. This together with the threat of cheap subsidised imports resulted in the collapse of farm prices. For instance, the MSP announced by the central government for wheat in 2002–2003 is Rs 620 per quintal, whereas the Uttar Pradesh farmer got only Rs 530 per quintal. The MSP announced by the Central government for sugarcane in the last five years has never benefited sugarcane growers.

Recent estimates show that the total loss of money to farmers per year due to crash in agricultural prices is around Rs 1,16,000 crores. Crop-wise loss to farmers per year during the tenure of the Vajpayee government is listed below:

Table 1: Loss to Farmers per year due to crash in prices


Rupees in crores















Spices & Plantation crops in Kerala


Failure of Monsanto crop in Bihar


Failure of BT cotton in India 7 states




(Source: Research Foundation for Technology and Ecology)

Why this sudden crash in agricultural prices? Is it because of over production? The real reason lies elsewhere — linked to the lifting of Quantitative Restrictions on the import of agricultural produce by the BJP-led government and its refusal to impose adequate import tariffs. This has been done by the government under the dictates of the World Trade Organisation. The same government that wants to take credit for the collapse of the WTO ministerial meeting in Cancun, is actually following the dictates of the WTO and is often willing to concede much more than what the WTO demands of it. This has led to the flooding of the Indian market by highly subsidised imported products like edible oil, skimmed milk powder, sugar, tea, silk, cotton, etc.

The rate of growth of agriculture in the last five years has dropped to 2.06% (1997 to 2002) from 3.7% and 3.9% attained during 7th and 8th Five Year Plans. The growth rate of foodgrain production has in fact declined even more in the period of the Ninth Five Year Plan (1997–2002) — down to 1.1%, i.e., less than the rate of growth of the population (1.9%). This is apparent in the falling per capita availability of foodgrains. We are poised to once again become a net importer of food, with grave consequences for food security and national sovereignty.

Other onslaughts

Dairy Sector

The BJP-led government has followed the prescriptions of the WTO and succumbed to pressures from private owners to deregulate the dairy sector. It has started dismantling licensing requirements for dairies handling or processing more than 10 thousand litres, and the provision of milk-shed areas provided for such plants. Milk co-operatives, responsible for the ‘white revolution’ in the country, involving millions of peasants and workers, are facing a major crisis because of this shift in policy. On the other hand, dairies run by multinational corporations have already entered the Indian market.


The BJP-led government, through its order in May 2002, has instructed State governments to evict all tribals and non-tribals from their lands, calling them encroachers. Already many State governments have started implementing the order. The entire 100 million strong tribal population in India is going to be affected as most of them have no legal records even for the lands they have been occupying and tilling for many decades. The BJP-led government’s order on evictions of tribals from forests is a clear reversal of all earlier guidelines of the Central government in this regard and especially the SC/ST Commission of 1990. The government, in order to enable MNCs and big business interests to purchase vast tracts of lands, has also encouraged many state governments to amend the ceiling provisions in their Land Reforms Acts.


The tenure of the BJP-led government has seen a steady decline in investment in the agriculture sector — which employs 69% of the total work force and contributes about 24% of the GDP. Allocation of funds by the government has decreased from 8% in 1996, to just 5.2%.

The government has recently launched the ‘Loknayak Jaiprakash Narayan Fund’ to develop the farm and rural sectors. In reality the launch is a massive fraud, since no money has been allotted for the fund in the budget. Further, in the guise of this fraudulent scheme, the government has quietly withdrawn the comparatively successful Rural Infrastructure Development Fund.

Credit Facilities

The share of agricultural credit to total credit advanced by financial institutions has come down from 18% to less than 11% during the last decade. The rural credit deposit ratio has declined from 1.58 in 1991 to 0.73 in 2001, which shows that deposits mobilised in rural India are utilised elsewhere. In other words, rural India is financing other sectors of the economy, while large sections of peasants and agricultural workers are being fleeced by usurious private moneylenders, driving them to land alienation, pauperisation and suicides. In cynical disregard of this, the Vajpayee government talks about issuing rural credit cards. Credit cards for whom? The millions of landless poor and small peasants? Only a government totally oblivious of the real concerns of the poor can even imagine such a scheme.


The Bjp-led regime has done little to prevent the predation of our natural resources by avaricious multinational corporations. Such companies have an eye on our rich genetic resources and traditional knowledge and numerous attempts are being made to patent these resources. Examples are recent attempts to patent products based on neem, basmati rice, turmeric, variety of Indian wheat, etc.

Conditions of Agricultural Workers

The major impact of the deliberate neglect of the agricultural sector is being felt by the landless agricultural workers. They are also the worst oppressed, both in class and caste terms. The proportion of landless workers in the rural population has gone up to 40% in 2002. The average number of working days available to agricultural workers has slumped from 123 in 1981 to 100 in 1991 and to 78 in 2001. It has further come down to 72 in 2003. Between 1991 and 2001 the number of agricultural workers in India increased from 7.46 crores to 10.74 crores. Their numbers continue to grow because of the pauperisation of peasants and their growing alienation from land. The Vajpayee government has adamantly refused to pass a central legislation for agricultural workers to ensure wages, social security measures and compensation benefits. The dismantling of the universal PDS and the increase in the price of food grains issued through the PDS, especially to those in the Below Poverty Line (BPL) category, has affected them the most. In the BPL category the cost of wheat has been increased to Rs 4.5 per kg from Rs 2.5 per kg and for rice it has been increased to Rs 5.9 per kg from Rs 3.50.

This is the real picture of rural India. It is clear that the Vajpayee government has failed miserably in providing food security to the population as a whole and livelihood security to cultivators and agricultural workers. The villages of India will definitely teach a lesson to the NDA government in the coming elections.