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Book reviews
The Dragon and the Elephant: Agricultural and
Rural Reforms in China and India
Edited by Ashok Gulati and Shenggen Fan, John Hopkins University
Press, Baltimore, 2007, 576 pp, ISBN 978-0-8018-8786-4, $75
(harcover), ISBN 978-0-8018-8787-1, $38 (paperback); for SouthAsian customers, also available in hardcover from Oxford University
Press-India
In the last few years, there has been a flurry of books and papers referring to
China and India the two emerging economies as the Dragon and the
Elephant respectively. The edited book under review is one of the latest in
the Dragon-Elephant series, and it attempts to apply the above comparative
implication to the agricultural sectors in these two countries.
The preface begins with the statement that between 1978 and 2005, Chinasper capita income overtook Indias at such a rapid pace that it was double
that of Indias in 2005. This transformation is attributed to a quarter of a
century of reforms. After 1978, China is argued to have reformed its agricul-
ture by moving into the household responsibility system in land use, liberal-
izing agricultural prices and creating a free market for agricultural products.
As a result, Chinas rural poverty fell from 33 to 11 percent between 1978 and
1984. On the other hand, even after a series of reform measures beginning
from 1991, Indias agricultural growth has fallen compared to the 1980s,and its record in reducing rural poverty is poorer than Chinas. The
Editors ask: What can the two nations learn from each other in terms of
their reform experiences and their impact on agricultural growth and
poverty? The chapters included in the book, arranged in seven sections,
are geared towards answering this question.
In posing the question as to what India and China can learn from each
other in introducing free-market policies in agriculture, the Editors shrink
the books scope into a very narrow perspective. There are a few presump-
tions that underlie this perspective in the book: (i) China owes its outstand-ing agricultural growth to the reform policies after 1978, and whatever
happened before 1978 was limited to creating favourable initial conditions
for post-reform growth; (ii) these reforms are in conformity with the
Community Development Journal Vol 44 No 3 July 2009 pp. 415426 415
& Oxford University Press and Community Development Journal. 2009
All rights reserved. For permissions, please email: journals.permissions@oxfordjournals.org
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prescriptions of the Washington Consensus; (iii) the progress on agricul-
tural reforms in India is rather poor, and this would explain its poor agri-
cultural growth and slow poverty reduction after 1991; (iv) to raise
agricultural growth and reduce poverty, India has to further liberalize its
agricultural markets, as China did after 1978; and (v) in both China and
India, the future lies in rapid economic growth to be achieved by continu-
ing on the path of reform. The above points are best captured in the Editors
concluding sentence in the book: the Dragon is breathing competitive fire
over a large part of the world, and the Elephant is ambling briskly.
Most of the chapters in this book follow the above thread. In Section 2
(dealing with issues of access to land, health and education), it is argued
that if an economy has more equitable distribution of land and better
human capital endowment as initial conditions, market reforms woulddeliver best.
In Section 3 (dealing with investment in agriculture, technology and
irrigation), it is argued that better initial infrastructure endowments in
irrigation and agricultural research as well as in power and transport at
the outset of market reforms would ensure faster growth and poverty
reduction.
In Section 4 (dealing with market and trade reforms), it is argued that
food security is no longer bound to domestic self-sufficiency in an era of
free trade. China opened up agricultural trade earlier, and more vigorously,
than in India, which reflects in better trade indicators for China. Better trade
indicators are anticipated for India too with the continuation of liberaliza-
tion, particularly in the spheres of minimum support prices, public distri-
bution system and input subsidies.
In Section 5 (dealing with rural diversification and vertical integration), it is
argued that rural diversification can be encouraged by creating a freer econ-
omic environment for private players, market-oriented reforms and relax-
ation of government interventions. Diversification does not just involve ashift of people from agriculture to non-agricultural sectors, but also a shift
within agriculture from food grains to non-food grain crops that are high
value and export intensive. A shift in cropping pattern is warranted by a
shift in demand patterns; data show a shift in consumption basket away
from cereals and towards fruits, vegetables, meat, fish, egg and milk.
In Section 6 (dealing with poverty alleviation programmes and safety
nets), it is argued that compared with other types of public investment,
public spending on anti-poverty programmes has had the lowest impact
on poverty reduction, due to leakages, poor design, lack of targeting and
corruption. Growth is argued to be the best bet against poverty.
All the five presumptions in the book summarized above can be called
into question.
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The book argues that the outstanding agricultural growth of China in the
1980s was a result of a set of market reforms in agriculture, beginning from
an egalitarian base set by the earlier regime. It is very difficult to agree with
such a view. China had a long history of reforms in agriculture after the
revolution in 1949. These reforms began with the land reform, and included
the mobilization of peasants under collective forms of land use and signifi-
cant public investment in irrigation and rural infrastructure. These were
more than just initial conditions. One of the major achievements of this
policy was to evolve over time a system of farm management that sought
to ensure a rational use of labour, natural resources and capital as well as
share risks. The resulting agricultural growth also contributed significantly
to the growing industrial sector through resource transfers. Also, rural
reforms succeeded in raising significantly the achievements in educationand health of the rural masses.
The period of Cultural Revolution between 1966 and 1976 was indeed a
period of excesses. Applying an incorrect understanding of classical
Marxist texts, Chinese policy in this period stigmatized the role of natural
economic laws and agrarian capitalism. As a result, this decade was
marked by serious distortions in the incentive structure in agriculture,
leading to stagnation in agricultural growth.
The book under review would have us believe that the Chinese govern-
ment introduced a slew of liberalization measures in 1978 to address this
situation. Such an argument betrays a lack of theoretical grasp of the
post-1978 policy changes in China. Reform in Chinese policy cannot be
equated with an embrace of the Washington Consensus. Quite to the con-
trary, post-1978 policy changes in agriculture were driven by the Marxist
dictum of ensuring harmony between the relations of production and the
forces of production. As the Chinese scholar Luo Hanxian argued,
Highly significant among these basic changes are those that have takenplace in agriculture since 1978, which are actually a continuation of the
transformation of the socialist relations of production. The aim is to make
production relations and management systems in the countryside
conform to the present state of development of the productive forces in
agriculture, and not to maximize collective management or effect the
highest possible degree of public ownership. . . (Hanxian, 1983, p. 20).
It is the continuity of the Marxist method in determining policy that the
book portrays as the abandoning of collective farms. To say that China
embraced a free market regime in agriculture after 1978 is to deny the fun-
damentally socialist character of Chinese agriculture in the 1980s and 1990s.
First, even under the household responsibility system, land remained under
collective ownership, and production was under contract. Secondly, the
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collective continued to manage ploughing, seeding, irrigation and water
conservation in the farms. Thirdly, peasants continued to contribute to
the collective accumulation fund that was used for public investment in
rural infrastructure even under the new reformed system.
Indeed, a peculiar combination of the instruments of the state and the
market mark the post-1978 Chinese policy. As the East Asian experience
has showed us, such a combination of instruments can be a powerful
driver of growth in an era of expanding world trade. In China, however,
the range of instruments used by the state was far wider than what the
East Asian governments used or the Washington Consensus prescribed.
The new regime in China was thus erected on the shoulders of the old,
representing a distinctive symbiosis of both.
Indias liberalization of agriculture began in 1991. Unlike China, thereforms in Indian agriculture mirrored significantly the prescriptions of
the Washington Consensus. The performance of Indian agriculture during
the period of reforms has been unambiguously adverse. The growth rate
of the index of agricultural production (IAP), which was 3.4 percent
between 19811982 and 19911992, fell sharply to 1.8 percent between
19921993 and 20022003 (Ramakumar, unpublished note). Significantly,
for the first time after independence, the rate of growth of IAP fell behind
the rate of growth of population after 19921993.
There is a lack of seriousness in the book in analysing this slowdown in
agricultural production in India after 1991. The argument in the book is
that the slowdown in production after 19921993 was due to large unfin-
ished agenda in agriculture, specifically in infrastructure, domestic market-
ing and investment. What is interesting is the refusal of the authors to apply
to India the same framework as used for China. The book misses the critical
point that reforms in India were implemented over an agrarian structure
that was deeply distorted in terms of power relations and livelihood
options. Unlike China, the Indian state failed to implement land reformor invest adequately in mass education and public health. The Editors of
the book argue that creation of initial conditions, such as land reform, is
not politically feasible in India.
To conclude, while the book covers a wide range of topics related to the
agricultures of China and India, the arguments in different sections are
deeply coloured by a dogmatic neo-liberal perspective. On China, most of
the arguments in the book ignore the basic socialist character of Chinese
agriculture even while it allowed private agents more freedom. Some of
the market-friendly measures in China are cherry picked and portrayed
in the book as representing a sharp drift into Washington Consensus-type
economic policy. Further, the fundamental contribution that the agricultural
sector in China made to its industrialization through resource transfers is
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left uncovered. On India, the book argues for more liberalization in agricul-
ture, even though all available evidence point to a severe slowdown in
agricultural growth after the reforms began. India is advised to learn
from China in implementing market-friendly measures in agriculture,
even though India lacks all the initial conditions that China had. Interest-
ingly, India is not advised to implement land reform, which was Chinas
most significant initial condition.
To come back to the question: What can the two nations learn from each
other in terms of their reform experiences and their impact on agricultural
growth and poverty? One conclusion that is quite clear for this reviewer is
that China does not appear to need any lessons from India in organizing
agricultural policy. Unfortunately, the Editors evade this important con-
clusion that any sensible reader is likely to draw from its chapters.
R. Ramakumar
Assistant Professor, Centre for Development Studies, Tata Institute of Social Sciences, Mumbai;
email: rr@tiss.edu
Reference
Hanxian, L. (1983) Economic Changes in Rural China, New World Press, Beijing.
doi:10.1093/cdj/bsp030
State, Markets and Inequalities Human
Development in Rural India
Edited by Abusaleh Shariff and Maithreyi Krishnaraj, Orient Longman Pvt.
Ltd., Hyderabad, India, 2007, 784 pp, ISBN 9788125027775, Rs. 975.
This volume has 18 chapters based on the results of a survey conducted by
National Council of Applied Economic Research (NCAER). The central
thrust, as the title suggests, is on human development in rural India. The
principal concerns of the volume are: human development indicators,
employment and its determinants, education, status of children, fertility,
maternal mortality, childrens status, education, health care and differentials
in development across social groups. There is a fairly comprehensive intro-
duction by the editors, which attempts to connect the chapters thematically.
At the outset, it needs to be said that the introduction is one of the strengths
of the book even though it has certain limitations, which are briefly pointed
out below.
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