Protests or vandalism? Don’t kill the golden goose of private enterprise

The farmers’ agitation continues and protestors hold the National Capital Region hostage by blocking different borders of Delhi. Our institutions face a dilemma: Should they allow the protests to continue even as it disrupts the life of 20 million people in the region or should they enforce law and order aggressively?

That India is a vibrant democracy is our biggest strength, but political opportunism at times creates a challenge for our weak institutions as they are unable to act due to various reasons. The developments in Punjab, where protestors are damaging private property, are far more worrying.

They are an outcome of a disturbing trend in the political discourse that demonises India’s wealth creators. These wealth creators provide for ample jobs, value addition and income flows which generates tax revenues that enables the government to extend the subsidies to the farmers of Punjab. Thus, if anything, the farmers of Punjab should express gratitude to the tycoons of industry, business-owners, and taxpayers rather than disrupting businesses.

However, what has transpired is the exact opposite. The way forward for Punjab – and for the country -- is to create a prosperous society whereby even the farmer can afford a “suit & boot” but instead, we are back to the ideas of Nehruvian socialism where profit is a dirty word. Nehruvian Socialism led to India being a poor country with a near stagnant level of per-capita income and limited economic opportunities.

Even as other states embraced this reality and are inviting private sector investments to ensure a better standard of living for their citizens, Punjab has slipped into the reverse gear.

It’s a simple fact that for faster growth and an improvement in incomes, we need non-farm manufacturing jobs to grow in India, including Punjab. Agriculture can support only so many people and we need to move workers to better productive sectors.

Moreover, there are serious concerns regarding the existing policy support that encourages cultivation of water guzzling crops such as paddy which have a significant environmental impact. The unsustainable nature of the farming practices means that even in agricultural growth, the region may face a significant constraint due to environmental degradation.

All of this makes it vital for the state to attract private capital to create significant non-farm manufacturing and services economic opportunities of the state. Its per capita income growth of 23 percent between 2011 and 2016 has lagged the national average of 29.6 percent.

Now, a firm would invest only when the state provides protection to private property. It is a basic requirement. With reports emerging of theft of gensets, damages to telecom equipment and disruption of telecom services in Punjab, it is clear that the state has failed to protect private property. The recent backlash against private capital will only dissuade investors from investing in the state and thus, the ultimate loser would be the citizens of the state.

This is common sense. But then the protests themselves smack of political opportunism. Remember, this agitation does not have widespread support. Farmers in India are not a homogenous entity. The protestors are a handful of large farmers from Punjab, Haryana and some regions of Uttar Pradesh. These large farmers have enjoyed the largesse of the taxpayer in the form of subsidies which allowed them to accumulate private capital. It is these few that oppose the option to grant economic freedom to our farmers to sell wherever they wish to sell. The new reforms will break the pre-capitalist feudal agrarian relations that have been formed with these large farmers at its nucleus over the last several decades.

Note that even Punjab Chief Minister Amarinder Singh had endorsed these reforms in the state’s COVID Response Report. That’s why it is disturbing to see senior leaders of the party in power in Punjab appearing to encourage such acts of theft and vandalism.

That the current political discourse has done everything possible to repel the private sector does not augur well for the state of Punjab and its people.