In the last fortnight, the West Bengal government has taken two decisions that have considerable scope for promoting economic development and distributing its gains. The first is that the state will buy land directly from farmers in order to promote industrial development. The second is to allow large private retailers to set up back-end centres to buy agricultural produce directly from farmers. Both represent a reversal of earlier policy. On land for industry, the Trinamool Congress government, which had come to power by campaigning against the acquisition of farm land by the previous Left Front government for large projects in Nandigram and Singur, had steadfastly held until recently that industry would have to buy land directly from farmers for projects. The state industries minister has, of course, denied an about-turn in policy by claiming that what the Trinamool Congress had opposed was "forcible" purchase of land from farmers. In the case of buying produce from farmers, the Left Front government had also wanted to do this, but was unable to carry along one constituent of the alliance, the All-India Forward Bloc. Although material progress is far off, the two decisions represent a learning process that the state government has undergone in its two years in office. This is the right mindset that allows a pragmatic search for policies that work, even if individual decisions may not deliver.
The need to be cautiously optimistic about the purchase of land by the government for industrial projects arises from past experience. West Bengal is like much of India in that landholdings are fragmented and a high proportion of farming families actually work on their small holdings. Thus, in Bengal, as elsewhere, it is extremely difficult for anyone - be it the state or private promoters - to put together a sufficiently large contiguous piece of land for a big industrial unit. Both Tata Metaliks and the state government, by turns, failed to acquire even 300 acres of land for the former's project. Bhushan Steel, on the other hand, burnt its fingers trying to acquire land directly. Two points are worth making. One, for a small landholder to get a fair deal and not suffer at the hands of touts and toughs, the government might have to play a role, even if remotely, to ensure fair play. Two, unless a state wishes to say goodbye to large industrial projects, there will come a time when the government has to step in to engage with a few small plot owners holding a project to ransom. The sovereign cannot abdicate its duty to exercise the right of eminent domain when the need arises.
As for large retailers buying produce directly from farmers, this will go a long way towards getting a fair price for the latter. But there is a catch. It is possible to abolish layers of middlemen; but it's not easy to eliminate the armies of rent seekers who extract a price from most commercial movement of goods. Such rent seekers have become a part of the political landscape; removing them will be a challenge. Abolishing the monopoly of the agricultural produce marketing committees will be the easy part.
