Kerala’s Communists Are Showing India a Path Out of Poverty
India’s neoliberal turn has had a devastating impact on farming communities. But in Kerala, a Communist-led government has sponsored highly successful agricultural cooperatives that promote solidarity over competition.
Kerala chief minister Pinarayi Vijayan of the Communist Party of India (Marxist), pictured right, being greeted by a member of the party Politburo on his first visit to the city after being sworn in for a second term, at Kerala Bhawan on July 14, 2021, in New Delhi, India. (Sonu Mehta / Hindustan Times via Getty Images)
Over the past thirty years, India’s neoliberal economic turn has had dreadful consequences for the livelihood of agrarian communities and the rural poor. The country’s ruling elites have imposed trade liberalization policies, slashed state expenditure and subsidies for farming, and weakened public procurement systems. There is a general trend towards corporatization of the agricultural sector, with corporate agribusiness not only determining the prices of inputs and outputs but seeking control of the entire production, value addition, and marketing processes.
Since the neoliberal economic reforms that were inaugurated in 1991, communities dependent on agriculture have experienced continuous pauperization. The share of India’s farm-dependent population in the country’s population as a whole fell from 59 percent in 1991 to 54.6 percent in 2011 and 45.6 percent in 2019–20. The proportion of cultivators in the farm-dependent population decreased from 59.7 percent in 1991 to 45.1 percent in 2011.
Already before the pandemic in 2019, the average figure for outstanding loans per agricultural household was 74,121 Indian rupees (about $1,000 — more than half the median income in India that year). The situation has grown worse since then, with all sections of the Indian peasantry and rural poor suffering huge losses in income. The agrarian crisis is so acute that at least thirty farm-dependent people commit suicide each day. Every fifteen minutes, another farmer abandons agriculture.
Suicide rates among farmers are higher for cash-crop cultivators who have faced the worst pitfalls of the neoliberal economic order. Factors like high volatility of prices in a globalized market, surges in production costs, and heavy indebtedness have combined to undermine agrarian livelihoods.
Since 2014, the policies of Narendra Modi’s Bharatiya Janata Party (BJP) government have deepened the agrarian crisis. In office, the Hindutva party reneged on its electoral promise to secure minimum support prices (MSP) for agrarian products (prices at least 50 percent above the cost of production). It has also slashed the budgetary allocation for agriculture year after year.
In 2016, Modi’s government suddenly imposed a demonetization scheme, withdrawing banknotes from circulation. This badly disrupted agrarian credit networks and local markets. Institutional credit lines from public sector banks have also been skewed in favor of agribusiness. Following Modi’s lead, BJP-led state governments have facilitated the takeover of agricultural land for corporate profitmaking and speculative land businesses.
The government has changed India’s labor laws, denying workers the right to unionize, increasing their working hours from eight to twelve per day, and rolling back other rights and protections. It pushed through three farm bills in 2020 to promote the interests of corporate agribusinesses. The ongoing protest movement of farmers has challenged the trend towards pauperization and corporatization of agriculture. It is against this backdrop that the experience of Kerala is especially important.
The Kerala Experiment
Kerala is now the only state in India where the Left holds power despite the rightward shift across the rest of the country and the hostile pressure from India’s national government. The state has a rich heritage of public action, labor militancy, and a robust social-democratic developmental ethos.
The state’s cooperative movement is significant for its record of promoting social initiatives from the bottom up and forging close links with the labor movement and other social reformers. The Brahmagiri Development Society (BDS) is one such initiative that has emerged from the womb of the movement as a response to the agrarian crisis during the neoliberal era.
After India’s neoliberal turn, cash crops linked to global export markets experienced greater price fluctuations. This had a dramatic impact on Kerala’s agrarian economy. The cultivation of export-oriented cash crops such as coffee, tea, coconut, pepper, cardamom, areca nut, and rubber accounted for 60 percent of all the area used for crops in the state. The prices of pepper and coffee, the main crops that were cultivated in the Wayanad district, fell by 69 percent and 59 percent respectively between 1997–98 and 2003–4.
These price crashes made it impossible for farmers to repay the loans they had received from moneylenders. Many lost their most valuable lands in this debt trap. The spread of drought conditions and crop diseases made the agrarian distress in Wayanad even worse. This hardship and grief led to a tragic wave of suicides among farmers in the district, with over 10,000 suicides between 1997 and 2005.
It was in this context that Varghese Vaidyar, a Communist representative in the Kerala Legislative Assembly from the Sulthan Bathery constituency, convened a meeting with elected officials from several panchayats (councils) in the Wayanad district to discuss possible ways of addressing the agrarian crisis. Subsequently, the All India Kisan Sabha (a farmers’ union), the Communist Party of India (Marxist), and other actors from civil society assembled a dedicated team of volunteers. They consulted with agrarian communities in Wayanad to draw up an appropriate project.
Cooperation Against Competition
The Brahmagiri Dairy Project Report was the result of this collective effort, and Vaidyar presented it in the Kerala Legislative Assembly. The report advocated support for dairy farming in Wayanad and the setting up of a modern slaughterhouse with a meat processing unit. The Left Democratic Front ministry in Kerala approved the proposal, allocated 2.5 million rupees in financing, and gave it administrative sanction on March 31, 1999.
The Brahmagiri Development Society has adopted modernized agro-industrial practices to boost the income of farmers by selling value-added products. They have organized breeder farms, cattle farms, and feed factories in both Kerala and neighboring states to ensure that cheap raw material supplies are available for member-growers. The BDS has provided veterinary support and mortality insurance. It procures poultry and livestock from farmers at a fair price.
The cooperative then processes the procured agriproducts in multispecies abattoirs, marketing them mainly in the forms of frozen meat, dried meat, chicken and beef cutlets, pickles, patties, nuggets, sausages, and wafers. Most of the society’s poultry member-growers manage at least 2,500 to 3,000 birds individually (without farmworkers) in a batch at their farms. They harvest at least six batches in a year and rear the birds for 11 rupees per kilogram, ensuring a monthly income of between 31,500 and 37,000 rupees.
The BDS also cultivates and procures tea, coffee, and spices based on community farming and has brought more farmers into the cooperative supply chain. Its members have developed a vast marketing network in Kerala under the collective ownership of peasants and workers. The Malabar Meat division of BDS alone has 110 marketing outlets in the state.
This helps the farmers secure higher prices by marketing the value-added products, eliminating exploitative intermediaries, and bypassing big corporations in the output market. During the pandemic, the BDS also explored the possibilities of online trade by launching a Farmers Trade Market (FTM) to provide home delivery from BDS chain outlets in the Wayanad district.
Democracy and Autonomy
The communist peasant and trade union leadership that was behind the BDS saw it as a social cooperative embedded in the political struggles of the agrarian classes that would prioritize the welfare of agrarian communities over profit. After the cooperative has covered its expenditure on raw materials, infrastructure, and marketing, it uses a democratic decision-making process to allocate a portion of the surplus to modernize agriculture and expand the cooperative market. The agricultural producers themselves share the remaining surplus in the form of higher prices and better wages.
The BDS has learned from previous experiences of Indian cooperative movements that became trapped in a mesh of state control and bureaucracy, with leadership positions monopolized by members of the dominant castes, rich farmers, and local political elites. It promotes horizontal forms of decision-making based on worker self-management, through which its members conduct their day-to-day affairs and make policy decisions. This facilitates positive change in the relations of production and promotes class solidarity at the workplace.
In order to achieve greater autonomy from state interference, the society is not registered under Indian cooperative laws, but rather under the terms of the Charitable Societies Act. This provides the BDS with greater flexibility to build networks and alliances with social movements, other cooperatives, and local bodies without losing its identity based on resistance.
In Wayanad district, the BDS is working with Kudumbashree women’s self-help groups — part of the poverty eradication mission launched in 1998 by Kerala’s Left Democratic Front government — and other state government initiatives. In 2017–18, the Kudumbashree groups provided the society with an order of 60,000 vegetable seed kits and created an additional 557 working days. In 2018–19, the BDS supplied around 500,000 vegetable seedlings to various panchayats in Wayanad.
Hope for the Future
A key component of the cooperative’s success has been the support it received from the left-wing state government in its initial stage. The government provided initial funding of 270 million rupees, and the BDS was able to raise an additional 630 million from its own members and the public. The state government has now declared its intention to provide the society with more financial assistance.
In 2018, the BDS and the Left Democratic Front ministry worked together to conduct the “Kerala Chicken” project, aiming to ensure Kerala’s self-sufficiency in meat production, encourage poultry farming, and mobilize small-scale meat retailers. This was a novel experiment in modern, large-scale cooperative farming. It was beneficial for consumers as well: With the market rate for live chicken meat around 180-210 rupees, the Brahmagiri Kerala Chicken can provide meat to the public at 140-55 rupees by eliminating market intermediaries.
The BDS has 13,500 members, 19 percent of whom belong to Scheduled Caste and Scheduled Tribe communities. Directly or indirectly, the social cooperative brings together an agrarian economic network of at least 100,000 farmers in the state. In 2020–21, the turnover of its members was 325 million rupees. They are overcoming peasant exploitation not just at the firm level but also through meso-level institutions, including retail outlets and statewide marketing and distribution networks, counteracting the injustices that arise from capitalist market relations.
The BDS offers a workable alternative to the neoliberal contract-farming models that provide big corporate players with direct access to farmlands. However, given the uneven growth of agrarian capitalism in India, the peasant movement has thought of social cooperatives not as a blanket solution for the agrarian crisis but as one way to build resistance against corporate exploitation in the agricultural sector. In this conception, the formation of a social cooperative remains part of the class struggle under and against capitalism. It provides immediate support and assistance to the peasantry and petty producers and can go on to be a critical component of postcapitalist economic restructuring.
Overall, the BDS has successfully mobilized farmers and agricultural workers in the fields of production, procurement, and processing. It has challenged the exploitative chain of intermediaries and the dominant role of corporate firms in the Indian agricultural sector, helping transform agrarian workers from low-income daily wage-earners into modern farmers with a stable monthly income. It has actively resisted the pauperization that neoliberal policies have inflicted on much of rural India, and contributed to agricultural modernization and the formation of a modern agricultural working class in the Wayanad district.
The BDS experiment shows how cooperation and worker-peasant solidarity, embedded in the political struggles of progressive movements, can transform agriculture into a reliable option for people to earn their livelihoods even in a time of grave agrarian crisis. India’s popular classes have been going through a very difficult period of social and political regression. But the Kerala experiment can help nurture a social imagination based on solidarity and cooperation rather than competition and exploitation, building hope and courage for the anti-capitalist struggles to come.