Land Ceiling 1f1s6c

Land ceiling 1. After abolition of Zamindari, the (superior) tenant farmers became virtual owners of the land. They owned tens and hundreds of acres of land. While other (inferior tenants/sharecroppers/landless laborers) owned nothing. 2. Many Zamindars themselves kept lot of land in pretext of „personal cultivation‟. Therefore, State governments enacted land ceiling acts. E.g.an individual farmer cannot own land beyond say 10 acres. Thus, if a farmer owned 12 acres, government would take away 12-10=2 acres of surplus land from him, and “distribute” it to some landless laborers. This is Second tool of Land reform. Before going further let‟s again recap the players in a tenancy system What is Ceiling on Land Holdings? 

It means fixing maximum size of land holding that an individual/family can own.



Land over and above the ceiling limit, called surplus land.



if the individual/family owns more land than the ceiling limit, the surplus land is taken away (with or without paying compensation to original owner)



This surplus land is

1. distributed among small farmers, tenants, landless labourers or 2. handed over to village panchayat or 3. Given to cooperative farming societies. Why Ceiling on Land holdings? 1. Because DPSP Art.38 seeks to minimize the inequalities of income, status, facilities and opportunities. Land ceiling minimize inequality in the land ownership and thus reduces inequality of income. 2. Because DPSP Art.39 wants to ensure that the operation of economic system does not result in the concentration of wealth. In a village, land=wealth, hence land ceiling is necessary to prevent concentration of wealth in the hands of few. 3. Because DPSP Art.39 wants to give right to adequate means of livelihood for all citizens. Land ceiling (and subsequent land redistribution) provides self-employment opportunities to landless agricultural laborers. 4. If there is no land ceiling, rich farmers will buy all the land of entire village and tehsil. But since they cannot cultivate all the land by themselves- they‟ll „lease‟ it to small farmers (tenants). Small farmer (tenant) doesn‟t have any „motivation‟ to work harder because he

doesn‟t own the land and he has to give 30-50-70% of the produce to that rich farmer, as “rent”= exploitation. 5. So, After abolishing Zamindari, IF State Governments had not implemented Land ceiling, then rich farmers/superior tenants would have become the new de-facto/virtual Zamindars of Modern India. Although, economists who believe in free market / capitalism, donot like land ceiling. We‟ll see their anti-land ceiling arguments at the end of this article. But for the moment, let‟s continue with the assumption that land ceiling is beneficial. Land Ceiling in India WE can study it in two phases: 1. From independence to 1972 2. After 1972 Ceiling Phase 1: Freedom to 1972 1946

(just before freedom) All India Kisan Sabha demanded a maximum limit of landownership of 25 acres per landholder Economic Program committee headed by Nehru, Recommended, „The maximum size

1947

of holdings should be fixed. The surplus land over such a maximum should be acquired and placed at the disposal of the village’



Congress Agrarian Reforms Committee, chaired by J.C. Kumarappa.



Recommended a ceiling on landholding which was to be three times the size of an

1949



economic holding. An economic holding was defined as that which would give a reasonable standard of living to the cultivator and provide full employment to a family of normal size and at least to a pair of bullocks.



There should be an upper limit to the amount of land that an individual may hold.



Exact upper limit was to be fixed by each State, having regard to its own agrarian

First FYP

history and present problems. 

1953

1957

AICC Agra session: State Governments should take immediate for the fixation of ceilings on land holdings, with a view to redistribute the land, National Development Council (NDC) adopted a decision to complete the

imposition of ceilings by the end of 1960. 

1959 

Nagpur session of Congress. ed resolution that All states should complete land ceiling by 1959 Surplus land should be given to Panchayats and Cooperatives of Landless laborers.

Salient Features During this phase, Land ceiling reform ran on following principles/features: 1. States were given freedom to fix land ceiling based on soil conditions, irrigation facilities, agrarian history of the region etc. 2. States had to conduct census of landholdings and classify agriculture land into two parts: Classification of land

What to do here? 1. States had to make law, that‟ll enable Tenant to

1. Land held by Tenants (i.e. after Zamindari abolition, these Tenants who had become virtual owners of the land.)

take over this land with “patta” (i.e. document showing possession).

2. Subject to maximum land ceiling in acres. i.e. surplus land from tenant will be taken away. 3. Owner could keep part of this land for his personal cultivation (subject to maximum land

2. Land held by Landowner himself

ceiling in acres) 4. State will give remaining „surplus‟ land to those agricultural labourers, with or without paying compensation to the original land owner.

Sounds good on paper? Yes. But Land Ceiling during this phase=EPICFAIL. Why? Limitations/Failures of Land Ceiling (‘47-‘72) Negative#1: No redistribution by the end

most states ed land ceiling Acts

of 1961 

by the end of 1970

Not a single acre was declared surplus in large states like Bihar, Mysore, Kerala, Orissa and Rajasthan!



In Andhra Pradesh, a mere 1,400 acres was declared surplus but no land was distributed.

by the end of 1970



Overall India: only 2.4 million acre declared surplus. Barely 50% of that surplus land was redistributed among landless.



This amounted to ~0.3% of total cultivated land of India in that era.

So why did this happen? Why didn‟t land ceiling acts achieve desired result? Because of following reasons: Negative#2: Family vs Individual



Initially States imposed the land ceiling on individual and not on family.



So big farmers transferred their land to sons, daughters, wives, relatives (sometimes even non-existent/dead family member) to avoid crossing the ceiling.



Many states provided extra-ceiling if family exceeded five . Example Andhra Pradesh had allowing 6 to 72 acres (depending on the nature of land) per „extra‟ member of the family.



In these day, there was no family planning= large sized family=very few families „crossed‟ the land ceiling. Thus, land ceiling definition itself defeated the noble purpose of land distribution. Negative#3: Land ceilings too high During this era, more than 70% of the landholdings were below 5 acres. Yet the ceilings were fixed too high, example: State

land ceiling

Andhra Pradesh 27-312 (depending on land quality) Assam

50 acres

Kerala

15 to 37.5 acres

Punjab

30 to 60 acres

West Bengal

25 acres

Maharashtra

18 to 126 acres

Result? Very few people crossed the land ceiling. Hardly any surplus land taken away. Negative#4: Exempted land categories 2nd Five year plan recommended following categories of land be exempted from “ceiling” laws: 1. tea, coffee and rubber plantations, orchards, 2. specialized farms engaged in cattle breeding, dairying, wool raising, etc., 3. sugarcane farms operated by sugar factories 4. Efficiently managed farms on which heavy investments had been made. 5. Land belonging to charitable trusts. 2nd Five year plan‟s intention was good- it wanted to promote capitalist/progressive farming and make foundation for the future green revolution. But State government implemented this policy in letter and not in spirit. Result? 1. „Efficiently managed farm‟ was vaguely defined. So many farmers evaded the ceilings by simply getting themselves declared „efficient‟. 2. Tamilnadu exempted land held by cooperatives from land ceiling act. So, Landlords transferring their lands to bogus cooperatives. 3. Many rich farmers setup bogus charitable trusts in connivance with state officials, then transferred land to charitable trust and avoided ceiling. Negative#5: Delay in Law Making 

State governments took lot of time to the land ceiling legislation.



This gave big farmers enough time to sell their excess lands, or to transfer it to their relatives and even make benami transfers.



Landowners evicted tenants and resume cultivation by themselves (on paper) claiming they had shifted to “Efficient” farming (so the land ceiling cannot apply). But in reality they just hired sharecroppers/landless labourers to do all the work.



Thus, by the time the ceiling legislations were in place, there were barely any holdings left above the ceiling and consequently little surplus land became available for redistribution.



Third Five year plan also itted this limitation. Negative#6: History repeats



Recall that during Zamindari abolition, the Zamindars tried all tricks to resist government‟s attempt. At that time, superior tenants/rich farmers ed government (with hope of getting land)



Now as governments tried to put land ceiling on these superior tenants/rich farmers=they tried all tricks to resist land ceiling



using their vote bank clout over political parties at state level=bills ed with lot of delay.



conniving with petty revenue official at village and tehsil level to transfer land to family and benami persons to avoid ceiling



filling flimsy court cases to delay the implementation Thus history repeated itself – those who sought land reform earlier, now became opponents of land reforms themselves. Anyways, so far first phase: 1947-1972, land ceiling is epicfail. Now let‟s check the second phase: Second stage: 1972 onwards 1970: Indira Gandhi says following The land reform measures implemented have failed to match the legitimate expectations which were first fostered among millions of cultivators during the national movement . . . In short, we have yet to create institutional conditions which would enable small farmers, tenants, and landless labourers to share in the agricultural New Deal. Soon, a conference of Chief Ministers @Delhi. They conclude:

1. Landlessness among rural poor=main cause of Naxal problem and agrarian tensions. 2. At present, Land ceiling varied anything between 10-54 acres. This has to be reduced because thanks to High Yield Variety Seeds +intensive cropping = even small sized farms of 1-2 hectares became economically viable. So there is no need for big ceilings. 1972: Union government gave following guidelines 1. New ceiling type

ceiling in acres

double-cropped perennially irrigated land 10-18 single-cropped land

27

inferior dry lands

54

2. land ceiling will be applied to family (husband+wife+three children) and not on individuals

3. While distributing surplus land, first priority to landless agricultural workers, particularly SC/ST. 4. Land owner will be compensated for his surplus land- but this compensation will be fixed below market price (so that new owner i.e. landless laborer can afford to buy it) 5. mechanised farms, land belonging to private trusts etc. should not be given exemption from land ceiling. Result? After this 1972 guideline, most states revised their land ceiling acts- except some northeastern states and Goa which had no ceiling laws. (table just for information, may be outdated right now.) States

Ceiling fixed(in hectares) States

Ceiling fixed(in hectares)

Andhra Pradesh 4.05 to 21.85

Madhya Pradesh 7.28 to 21.85

Bihar

6.07 to 18.21

Maharashtra

7.28 to 21.85

Gujarat

4.05 to 21.85

Orissa

4.05 to 18.21

Haryana

7.25 to 21.85

Punjab

7.00 to 20.50

Himachal

4.05 to 28.33

Rajasthan

7.28 to 70.82

J&K

3.60 to 9.20

Tamil Nadu

4.86 to 24.28

Kamataka

4.05 to 21.85

Uttar Pradesh

7.28 to 28.33

Kerala

4.86 to 6.07

West Bengal

5.00 to 7.00

But rich farmers still continued to evade the ceiling by filling court cases on flimsy ground. In Andhra Pradesh alone ~500,000 pending cases pertaining to land ceiling were filed! 34 th Amendment 

Since rich farmers continued to evade land ceiling by flimsy courtcases, the Union government came up with 34thConstitutional amendment in 1974.



This amendment put most of the revised ceiling laws (of state governments) in the Ninth Schedule of the constitution so that they could not be challenged in the courts on constitutional grounds. (according to Art.31B) Result? Some progress in surplus land being redistributed, but overall results were still far from satisfactory.

early

~2 million acres land redistributed (but rich farmers wilfully dispersed more than

80s

30 million acre land to avoid ceilings)

1885

~4 million acres land redistributed.

So far we‟ve seen 1. what is land ceiling and why do we need land ceiling 2. land ceiling in two phases: freedom to 72 and from 72 onwards. Now let‟s check the overall positive/negative points: Land Ceiling: problems/ limitations/obstacles #Epicfail in UttarPradesh 1. U.P. Imposition of Land Ceiling Act was ed in 1960. The Act put the ceiling limit at 40 acres. It defined family in a liberal manner and allowed a large number of exemptions. 2. When ceiling came in effect, Zamindars connived with local officials. As a result, they kept the best fertile land and mostly unlevel, wasteland, waterlogged or sandy/salty land was declared as surplus and given to landless. 3. Poor Beneficiary had to face irregular power supply, absence of government tubewell, high charge of water, etc. 4. The Village Pradhan and Lekhpal will not give Patta (possession document) to the poor, unless they paid bribes. 5. Many poor who got land, resold it back to the original owner under Benami transectionsunder greed, threats and coercion. Thus, Land Ceiling Act hardly made an impact on the land distribution in UP. Former zamindars retained large tracts of land and converted themselves into large landowners which did give them political power. Land reform Delayed is land reform denied 

The states took four to nine years to formulate the proposals, discuss them in the assembly and finally them.



This lengthy time period was enough for the intermediaries to prepare for the eventual implementation of the Land ceiling Act.



They ed surplus/excess land under relatives‟ names and or even fictitious persons, manipulating land records and reclassifying land under different heads. In short most of them managed to evade land ceiling acts. Hardly any ‘redistribution’



Overall, the land which has been declared surplus and distributed among landless= less than 2 percent of the total cultivated land.



Hence, we cannot say land ceiling was a game changer.



But only positive thing= It prevented further concentration of land in the hands of few rich people.



In other words, land ceiling didn‟t change the „existing‟ land holding pattern but merely prevented concentration of land in few hand in the „future‟. Lack of Auxiliary



More than 6 million hectares of wastelands were distributed among the landless.



But it was #epicfail as states did not give any assistance to transform the wasteland to make it fit for cultivation.



Lack of Structural changes @village (education, transport, healthcare etc.)



Many a times, even after a landless get land, he doesn‟t get credit (loans) easily to buy seeds, fertilizer. So he „leases‟ his land to a bigger farmer and himself migrates to city in search of jobs or works as labourer in someone else‟s farm. Lack of Political Mobilization



After Abolition of Zamindari, the superior tenants (mostly rich to middle income farmers belonging to General/OBC group) acquired a higher social status.



They economic strength also increased because of green revolution.



Subsequently these landowners wielded great authority in rural India and bitterly opposed to a ceiling on agricultural holdings.



They are able to have their way because political parties made no serious efforts to mobilize small/marginal farmers or landless laborers to enlist their in favour of ceiling and other land reforms. Lack of istrative will



Mere ing a law= insufficient. It must be implemented with full vigor and efficiency.



During this era (60-70s), the small/marginal farmers or Landless labourers are not organized politically. 73rd Amendment for Panchayati Raj is not even ed yet.



So, there was no pressure/compulsion on district-tehsil level officials to perform efficiently. They were corrupt and inefficient as ever. FYP did not give direction



First Five Year Plan identified small and uneconomic holdings as the root cause of many difficulties in the way of agricultural development. But still did not pay much attention to land ceiling. Meaning, First Plan (secretly) did not want to disturb the big farmers or land owners who were crucial to increased agricultural growth.



Second five year=gave the concept of „exempted‟ categories of land (tea plantation, efficiently managed farms etc.) and we saw how this exemption was misused.



Third and Fourth Plans=War, stoppage of aid, famine, food-insecurity, fiscal deficit etc. So they had very little to say (or do) on the issue of land reforms in general and land ceiling in particular.



by the time we reach fifth five year plan (74-79) there is emergency, Indira-Hatao, Morarji trying to hold a coalition government => land ceiling reform did not figure in priorities- be it planning, policies, legislation or grassroot mobilization of peasants.



6th FYP onwards (80s), the focus shifts to poverty removal, self-employment, watershed etc. and land ceiling became as obsolete to five year planning, as Vivek Mushran, Rahul Roy and Kumar Gaurav are for today‟s Bollywood. Land fragmentation=Low GDP



Between 85-92, number of beneficiaries increased more than the increase in area distributed=> new beneficiaries received very tiny plots.



As generations ed- more and more land division among sons=>smaller and smaller farms=no economies of scale, disguised unemployment, low productivity etc.



These small farmers could have stopped uneconomic farming, and picked up some financially rewarding non-agro job e.g. factory worker, rickshaw driver etc. But that did not happen because other rich farmers couldn‟t buy their land due to land ceiling laws.



Thus in the long run, Land ceiling killed the rural land market, and prevented land consolidation.



Economists agree that if country wants to progress from developing=>developed nation, then people must move from agriculture to manufacturing/service sector.



But that is not happening in India. Thus, land ceiling being one of the reason why majority of population continues to depend on agriculture. Post-LPG: Changed priorities



Therefore, today government is more focused on industrial sector and the service sector growth, self-employment generation type schemes. Land reform-Land redistribution doesn‟t form priority.



Whatever land redistribution was to be done, has been done by 80s. Today there is no „new‟ land to cultivate. Infect, urbanization putting more pressure on existing agriculture land.



So, if you (government) want to redistribute land, there is only one way: amend land ceiling e.g. no one can own more than 1 acre, then take away surplus land from farmers who own more than 1 acre, and redistribute among landless.



But this policy is impractical for governments because



It‟ll increase land fragmentation. Small sized farmers= lower economies of scale, mechanization not possible=lower productivity



It‟ll annoy the existing vote bank of small-medium farmers because their surplus land will be taken away. In short, land reform is no longer in the priority list of Government policies. Today Government gives priority to food security, direct cash transfer, as far as rural India goes. Anyways, enough of negative points about land ceiling. Let‟s check some positive points Land Ceilings: Benefits/Advantages/Positive Points With political Will States with political will in favour of land ceiling=showed great progress. Example

1. Jammu and Kashmir, Land ceiling laws fully implemented and by the middle of 1955 about 230,000 acres of surplus land had been handed over to tenants and landless labourers, that too without having to pay any compensation. 2. West Bengal had less than 3% of total cultivate land in India. Yet more than 25% of the total surplus land that was distributed throughout India, belonged to WB.

Production increased 1. Earlier large tracts of wasteland belonging to big zamindars/farmers remain uncultivated. Now this given to landless laborers= increases area under cultivation=food security. 2. More Production: Equal distribution of land will encourage intensive cultivation resulting in increased agricultural production. 3. Some Farm management studies conducted in India testified that small farms yielded more production per hectare. It is so because family themselves cultivate small farms. 4. Even one hectare of land is also an economic holding these days on of improvement in agricultural technique. Hence, small size of holding due to ceiling will not have any adverse effect on agricultural production. 5. Atleast some of the Land owners shifted to direct „efficient‟ farming in order to get „exemption‟ from land ceiling. 1. Landless laborer= gets employment only during sowing and harvesting Employment season but now he given land ownership = he is 24/7 self-employed farmer. increased 2. Even if he did not get land, still other farmers got land=> more demand for

agri.labourers= wage bargaining power increased. 3. In other words, land ceiling increased employment opportunities. 1. With reduction in inequality among the villagers, possibility of class Naxal reduced

struggle will be minimised. 2. They will live with perfect peace and harmony and not Maoists/Naxals movements any longer. (atleast in theory) 3. In a rural economy, whoever controls land, controls the power.

Social Justice

4. Land ceiling Reduced this power inequality among villagers. 5.

Promoted spirit of cooperation among villagers. Will help develop

cooperative farming later on (atleast in theory). Growth of New political parties 

1959: N.G. Ranga, C. Rajagopalachari and Minoon Masani setup the Swatantra party.



Because they were against land ceiling, compulsory cooperativization, nationalization of private industries etc. policies of Congress government. 1967 Charan Singh formed BKD 1974 BKD+ Swatantra Party + other parties merged=>BLD

1977

BLD was major component of Janta Government under the great Morarji Desai who defeated Indira Gandhi.

Thus, in a way land ceiling helped destroying Congress monopoly / One party rule in Indian politics. Land Ceiling: Pro and Anti arguments Like I said in the middle of the article- the economists believing in free market / capitalismthey don‟t like land ceiling. So let‟s hear their arguments Anti-Land Ceiling 

Pro Land Ceiling

Land ceiling should be abolished. even  Agricultural income= exempted from income corporate sector should be allowed to buy tax. agri. land.





So, if land ceilings are removed, the rich people

This will enable the enterprising farmer to will rush to buy farm land. enlarge his holding by buying or leasing  Thus

land

prices

will

soar.

A

new

lands of small farmers. 

„intermediary‟ group of Agri.land mafia will

Although landlessness will increase but emerge. these

small

farmers

could

find  But millions of small and marginal farmers will

employment in agri. and allied sector as a be pushed off their land. result of capitalist mode of production. 

Hence, the time is not yet ripe to bring forth such

drastic

reforms

(of

removing

land

ceilings). 

Capitalist mode of agriculture=>more surplus income=> invested back into the  Capitalist mode of agriculture uses more agriculture=economic growth.



machines,

less

laborers=>unemployment

if corporate sector is allowed to enter in increased. agriculture=> increase=>more

Agri.

exports

foreign

will  Yes, Economic growth will be achieved but at

exchange the cost of unemployment and subsequent fall

incoming=>Current deficit gone, in human development. rupee will strengthen. 

large farms tend to prefer monoculture (single crop), because they can be easily managed with



small farms are not productive because they hinder mechanised farming



Small farmers have limited capital to 

invest in improving agro. Production.

heavy machinery. = more susceptible to pest attacks, not good from soil fertility point of view. Small farmers usually have mixed crops (intercropping), they combine and rotate crops and livestock, with manure => soil fertility improves.



Land ceiling and distribution => poverty and disguised unemployment continues.





Some people need to be shifted from agricultural

sector

to 

manufacturing/service sector. There is no need to give land to each and every landless person.

Villagers should be kept self-employed, even if on small and marginal farms. This fits with Gandhian ideas of village republics.