Clemens Dutt

Capitalist Exploitation in Indian Agriculture
Part I

Source: Labour Monthly, Vol. 9, November 1927, No. 11, pp. 669-676
Transcription: Ted Crawford
HTML Markup: Brian Reid
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The basis of British imperialist exploitation of India to be found in the exploitation of the agricultural population. India has been primarily valuable capitalism to Britain as a source of raw material and as a market for British manufactured goods, and the development of India in these two directions has involved the transformation of the old social order, the destruction of the old self-contained village economy of skilled handicrafts, and the conversion of agriculture into capitalist industry. The effect of British policy is seen in the over pressure on agriculture, resulting in no less than 72 per cent. of the total population of 320 millions being now dependent on the one form of occupation, and in the extreme and growing poverty of millions of cultivators. This poverty is only partially attributable to the direct burden of Government land revenue exactions. More important, as will be seen, are the less obvious forms of exploitation due to the penetration of capitalism in the village and the conversion of the cultivating peasant into producing commodities for the capitalist market. In this process, exploitation by the Government, by landlords, by money-lenders and capitalist merchants all play their part and no remedy for the poverty stricken conditions of the peasant can be found by considering one of these evils apart and alone, any more than remedies can be found by isolated reforms in the direction of improving agricultural methods, devising checks on sub-division of holdings, &c. The change that is taking place in the village is a whole process of social change, involved in the replacement of feudalism by capitalism and the development of capitalism with its accompanying class differentiations marked above all by the creation of a class. of landless agricultural proletarians.

Exploitation by Government.

A direct levy on the peasant cultivator or landlord based on the area cultivated or the amount of the crop was the earliest form of government revenue, and for a long time was the chief source of income for the British administration. Sir William Hunter, in his book on The Indian Empire (1882), declared that:—

The land furnishes the chief source of Indian revenue and the collection of the land tax forms the main work of Indian administration.

At that time the gross revenue collected amounted to 22 millions. In 1924-25 the total land revenue from British India had increased to Rs.37.7 crores or the equivalent of about 22 millions. With the development of other sources of revenue, especially from customs duties and from railways, the land revenue, although greater, than before, ceased to represent the most important item of the budget receipts. The report of the taxation inquiry committee issued in 1926 declares that the land revenue which forty years ago contributed 53 per cent. of the total receipts of the Government, now contributed only 20 per cent. Nevertheless, this burden, which falls with especial hardship on the millions of small cultivators, is sufficiently great, added to as it is by local exactions and the payment of indirect taxes on salt, &c., to cause many Indian nationalists to see in it the main reason for the now universal poverty of the peasants. The opinion of Keir Hardie, written after his tour in 1907, may be taken as typical and is worth quoting at length. He says:—

Eighty per cent. of the taxes in India are raised by revenue assessment upon land. The Government steadily discourages private ownership in land as it objects to an idle landlord class coming between itself and the real producers of wealth—those who till the soil. The amount of taxes raised direct from the peasant is from 50 to 65 per cent. of the value of the yield of the land, in addition to which they have to pay local taxes and various other small items so that probably not less than 75 per cent. of the harvest goes in taxes . . . . From time to time the revenue charges are revised so that the Government may obtain the last penny which can be wrung from the over-weighted peasant. Increases of 30 per cent. are common, and there are many on record of 50, 70 and even 100 per cent. It is this fact which keeps the people of India in a condition of perpetual, hopeless, grinding poverty.

Keir Hardie quotes also some figures which he regards as fairly conclusive evidence that the peasant pays more now than he did under pre-British rule. Thus, he points out that when the province of Bengal came under British dominion in 1817, the revenue claimed by its rulers from the peasants was estimated at 8 million rupees or one-fourth of the crop. After 1817 the process of forcing up the land revenue began, so that by 1823 it had been increased to 15 million rupees, and by 1875 to 48 million rupees. According to the latest official report (Agricultural Statistics 1924-25) the total land revenue from the fully assessed area of the Bombay Presidency for which figures are available, and excluding Indian states, was 43.8 million rupees. This however excludes about 48 million acres not fully assessed, and another million acres of which figures were not available. The estimated revenue for 1925-26 given in the provincial budget amounts to 56 million rupees. There has been considerable controversy over the question whether or not land taxation is heavier in its incidence now than it was under pre-British rule, but one thing is certain and that is that the peasant is made to yield as big a tribute as can possibly be exacted without causing his absolute ruin, and that he receives very little in return. The peasant might just as well be paying the money directly to the British Treasury in England for all the return that he sees. There are many villages which pay a contribution of several thousand rupees and never see a British official or any sign of Government enterprise, not even a school. The provision of village education should obviously be the first charge on the money taken from the peasants, yet its neglect in India is a by-word throughout the world, and two villages out of every three will be found to have no school at school. Nor can Government irrigation schemes be regarded as a return for land revenue payments, for irrigation water is made the subject of a special charge, and, in fact, the Government irrigation works taken as a whole yield a return of 7 to 8 per cent. on the capital invested in them.

Apart from its magnitude as a whole, the British system of obtaining revenue from the peasantry exhibits several features which involve special hardships for the poorest part of the population. In the first place, the revenue demand is based on the area and rental value or quality of the soil and is independent of the size of the crop, on which all pre-British land taxation was based. Only in the case of very severe crop failure can there be a compassionate remission of land taxation. Consequently when the crop is indifferent or poor the peasant usually suffers severely. In the second place, together with abolition of estimation of the tax according to the crop, payment in grain has also been abolished and replaced by payment in money. Thirdly, payment is enforced with the utmost severity. There have been many cases where peasants have had to sell their cattle and household utensils to pay the tax, and even more frequently cases where they have had no alternative but to fall into the clutches of the moneylender to avoid distraint. Even more harsh is the nature of the incidence of the tax, which is levied uniformly whether the cultivator has a holding of several hundred acres or a miserable plot of less than an acre. In the case of a big landlord or cultivator, the payment of land revenue is a comparatively small burden in the case of the poor peasant it is an exaction which represents a relatively enormous toll on the amount available for the purchase of the necessaries of life.

More than half of the total cultivated area in India is held under the ryotwari system of tenure, where the ryot or cultivator pays the land revenue direct to the government officers under an assessment which is revised at periods of about thirty years. Frequent cases of discontent occur among the peasantry at the enhancement of land revenue on revision of the settlement. Thus, in the Alibagh district there has been this year a considerable movement of revolt among the peasants, who have refused to pay land tax owing to the increases imposed. In such cases, the Government has the power to sell the goods of the ryot and even to alienate his holding. In the report published in March, 1927, of the Committee on Land Revenue appointed by the Bombay Legislative Council there is a minute of dissent by Rao Saheb D. P. Desai which, among other things, calls attention to the “stringent provisions of the Bombay Land Revenue Code which enable the collector to sell the immoveable property of an agriculturist under sections 153-55 for arrears of land revenue,” and he declares:—

the present land revenue law of procedure is arbitrary and harsh and even the small concessions that it makes are never carried out in practice . . . . ownership once enjoyed by the ryot over his holding has been snatched away from him and he is made a serf of the Government.

Provincial reports on land revenue show that sales of peasants holdings in default of revenue payments still take place. In 1922-23 the Madras Government sold land estimated to be worth over 11 lakhs of rupees in order to recover arrears of revenue amounting to less than 2¼ lakhs. The sale realised less than 2 lakhs.

The facts relating to land revenue show that it plays an important part in the exploitation of the peasant population. The cultivators holding their tenancies direct from the Government under the ryotwari system are not in the position of peasant proprietors, but are virtually tenants of an exacting and oppressive landlord. The final stage of capitalist agriculture is reached when the land is cultivated by wage-labourers hired by the capitalist landlord. Under the present system in India that stage has not yet been reached, but since so large a proportion of the small peasants are hardly able, or definitely unable, to make a bare subsistence out of the land, they may be considered to all intents and purposes as wage labourers on an enormous State farm who receive for their labour only just sufficient for their reproduction, while the rest of the value that they create goes into the pockets of the exploiters.

Exploitation by Landlords

The introduction of capitalism into Indian agriculture involved a number of processes including as the most important (1) the break-up of the village communal system of production, (2) the introduction of private property in land, (3) the replacement of barter by money economy, (4) the abolition of serfdom and other relics of feudalism. The first two processes naturally go together, and from the earliest occupation of India, the officials of British administration consciously sought to reproduce the social relations of capitalist agriculture with which they were familiar at home. Their desire was to create a body analogous to the landlord class in England and they considered that the best way to secure this object was to confer large property rights in land on loyal ruling chieftains or on their own creatures (often originally mere farmers of the revenue), and to fix the land tax payable by them in perpetuity. This was the origin of the permanent settlement made in 1793, under which the amount payable as land revenue by the big landlords or zemindars was fixed once for all. Later, the Government found that it was undesirable to be unable to change the rates of assessment, and so the later assessments under the zemindary system, in which the Government collects the revenue not directly from the peasants but through the class of superior landlords, were made temporary. The area under the zemindary system in British India amounted in 1921 to about 318 million acres (i.e., about 48 per cent. of the total area), of which 123 million acres are under permanent settlement.

The big zemindars are still the typical representatives of the Indian bourgeoisie. Of the 229 millions dependent on agriculture as estimated by the 1921 census, including Indian States, 10 millions are put down as obtaining income from rents.1 The majority of the zemindars are a sheer burden on agriculture, mere rent-receivers, rack renting and exploiting the peasants under them. The total burden of this parasitic class in agricultural production on the backs of the actual cultivators is considerably greater than that of the Government land revenue exactions. Professor K. T. Shah attempts by two different methods to arrive at an estimate of the total income of the landlord class. The first estimate is derived from the figure of the total land revenue paid on land held under the zemindary system. This land revenue amounts to about 18 crores of rupees and on the assumption that the zemindars pay away about ten per cent of their income as land tax, their total income would be approximately 189 crores of rupees, or about 135 millions. Reckoning that there are rather over 10 millions supported by rent in British India, or nearly two million families, this estimate would give an average annual income of 180 rupees per head or 900-1,000 rupees per family. This sum is at least several times as large as the average annual income of a peasant cultivating family, and, of course, while many families of rent-receivers will be also cultivators, there will be a large number of big proprietors with incomes much above 1,000 rupees per year.

The second method of estimating the burden of landlordsim is of especial interest, as being based on the toll taken of the agricultural production of the peasants. Professor Shah calculates the total net agricultural production for 1921-22 to be valued at just over 2,000 crores of rupees.2 Of this, the share of British India on an area basis is about 1,300 crores, or allowing for richer land and greater cultivation, say 1,500 crores. Nearly half of this is produced under the zemindary system, i.e., an annua1 value of 600-750 crores of rupees. If, then, rent is taken as equal to a quarter of the gross produce, the total income from rents will be 150-188 crores of rupees.

It is possible that the above estimates are rather on the high side for some parts of the country, but this is certainly not the case for the permanently settled area, particularly in Bengal. In Bengal, the land revenue under the permanent settlement remains what it was a century ago, viz., about 2¼ crores of rupees, but the rental value of the land has so- much increased that, according to the All-India census report, “the total realised as rent by the landlord class including middle men in Bengal is Rs.13.5 crores per annum.” In some parts of Bengal there are as many as 12 or even 16 intermediate landlords between the revenue paying zemindar and the cultivating peasant, each one of whom does his best to rack-rent those below him, the final oppressive burden being borne by the poverty-stricken ryot.

Formerly, with more land available and fewer possible tenants, the landlords could not afford to dispossess their tenants and rents were lower. During the last century, with the growing pressure on land, rack-renting has enormously increased so that the Government has been forced to introduce legislation in order to prevent the landlords from demanding exorbitant rents and ejecting the tenants from their holdings. As an example, the Revenue Administration Report for the Province of Agra, 1892-93, notes that in one year at that time “application for ejectment of tenants-at-will rose from 57,875 to 64,353.” Two years later the figure rose to 72,105. The Agra Tenancy Act, 1901, attempted to counteract this by defining different classes of tenants, with the object of making it illegal to eject or raise the rent of the established holders. In spite of legislation, the number of non-cultivating landlords and tenants is everywhere on the increase. Madras statistics show that the proportion of non-cultivators supported by agriculture increased from 20 per 1,000 in 1901 to 27 per 1,000 in 1921 (Pillai, Economic Conditions in India, 1925). In the Guntur region of Madras, the proportion of non-cultivating landowners increased from 30 per 1,000 in 1901 to 34 in 1911 and 56 in 1921. The number of non-cultivating tenants increased from 2 per 1,000 in 1901 to 32 per 1,000 in 1921. (Economic Organisation of Indian Villages, Ranga and Reddi, 1926.) Professor Radha Kama Mukerji declares that “in the Punjab alone, the number of rent receivers has increased from 660,000 to 1,000,000 during the last decade.” (Forward, January 17, 1926.) Even under the ryotwari system the number of non-cultivators is on the increase. In his study of the village of Jutegaon Bruk in the Bombay Presidency, Dr. Mann found that there were 146 landholders and only 114 separate cultivators. The following figures quoted by Pillai (Economic Conditions in India) give an idea of the growing rate at which land was changing hands in the Punjab at the end of the nineteenth century.

Average Annual Sales of Land
(area in acres)
Average Annual Area mortgaged
(area in acres)
1866-74 88,000 143,000
1875-80 93,000 212,000
1880-85 160,000 296,000
1885-90 310,000 590,000
1890-95 338,000 554,000

Mr. Pillai notes that “the new owners have not generally turned to the cultivation of the soil; the old cultivators were to remain not as owners but as tenants.”

These figures bear witness to the prevalent increasing poverty and distress of the peasant cultivators and the increasing expropriation from their holdings. The peasant proprietors are passing away, they are becoming mere workers for a parasitic landlord class, or are even definitely thrown into the ranks of the landless agricultural proletariat. The following quotation from a recent study of agricultural conditions in Malabar describes the same process of landlordism at work in another part of India.

In a simple lease of the Verrumpattam type it is not at all uncommon that the tenant is called upon to pay to the landlord the whole of the estimated net produce after deducting the bare??? of seed and cultivation and consequently he is merely a labourer on subsistence wages, though it suits his landlord to bind him by contract. It frequently happens that the rent which the tenant covenants to pay is more than the land could yield, and in this case a burden of debt accumulates on him, and his position becomes little better than that of a slave. If he incurs his landlord’s displeasure a decree of eviction and arrears of rent, and his means of livelihood are gone for ever. (Economic Life in a Malabar Village, S. Aiyer.

This sort of situation could be paralleled from almost every part of India. Connected with the development of capitalism in agriculture and the increase of the landlord class is the form which is becoming more and more common all over India of absentee landlordism. Formerly only the biggest landlords left their estates to be managed by an agent and themselves lived in the towns or abroad. The majority of the lesser zemindars were themselves interested in agriculture and were not yet attracted by the new methods of spending money available under capitalist civilisation. Since then more and more have left their holdings for the luxuries of a town life. Thus we have reproduced in India all the evils associated with “absentee landlordism,” familiar the history of Ireland. Sir P. C. Ray, giving evidence before the Economic Inquiry Committee in 1925, declared, “one of the principal causes of the growing poverty of the rural population is absentee landlordism.” Naturally, with the hierarchy of landlords in Bengal under the permanent settlement, absentee landlords are more common there than elsewhere, but similar reports are available from all parts.

In Malabar, it is declared that:—

The big jamnis or landlords are more often than not absentees living in a distant place interested only in the punctual collection their dues. (Economic Life in a Malabar Village, S. Aiyer, 1925.)

A study of a village Bheka3 in the Allahabad district reports that “practically all the zemindars are absentees,” and comments on its evil results in the lack of example and assistance to the cultivators, (such as could be afforded by the running of model farms) and the absence of communal activity. The author declares that whereas indifference to neighbourly obligations was formerly a characteristic only of the towns it is now finding its way to the village also.

The modern system of landlordism in India is predominantly on a capitalist money basis. Nevertheless many relics of feudalism still exist in many parts of India and especially in the Indian States. The depressed classes or outcasts, the so-called untouchables, were at one time in many cases serfs bound to the soil. Landlord oppression of these classes and of the poorer cultivators takes the form of the exaction of many other services and contributions besides that of rent. Such exactions consist especially of compulsory labour for the landowner and forced contributions and levies on special occasions paid either in money or in kind. Professor Mukerji (1925) says that many serfs still exist in most villages of the central provinces. In Malabar a peculiar feature of agricultural labour is the existence of a class of semi-slaves called Cherumas or Pulayas. It is only half a century ago that their legal status as slaves was removed and even now they are agricultural slaves attached to their master’s soil and transferred to the buyer of land when it is sold. Their wages are paid in kind. In Cochin, they comprise 50 per cent. of the field labourers in the State. In Bombay Presidency there occurs a well-known form of tenancy known as the “Khoti” system, under which the owners of the soil, the “Khots,” regard themselves as having various feudal rights over the peasants, who complain of exaction of forced labour and other semi-feudal dues. These relics of feudalism are survivals from the pre-capitalist period. They are now rapidly passing away with the conversion of the former serfs into free proletarian labourers, but the exploitation of the latter is not any the less intense under their new status.

(To be concluded.)



1. Professor K. T. Shah estimates the total number of rent receivers in the several provinces of British India as 12½ million as compared with 193 million ordinary cultivators. (Wealth and Taxable Capacity of India.)

2.One crore = 10,000,000. A crore of rupees = approximately 7½ millions.

3.Studies in the Rural Economy of the Xlahabarl District, B. G. Bhitnagar. 1924.