Road map for Kerala

An initiative focussed on Kerala’s development experience exposes a worrying trend of rising inequality and proposes a strategy for sustainable and equitable growth.

Workers at a field near Attappady in Palakkad.

THE fourth international Congress on Kerala Studies, organised by the A.K.G. Centre for Study and Research in Thiruvananthapuram on January 9-10, has generated much interest for its focus on a worrying new trend in Kerala’s development experience: rising inequality and marginalisation of large sections of people despite its economic growth in the past two decades.

Once again, as major political parties in the State begin preparations for a decisive Assembly election, the solutions they propose to tackle such new economic problems are also receiving a lot of attention.

The “Congress on Kerala Studies”, a unique exercise where experts and people from all walks of life get together to discuss the development agenda of the State, has been organised by the Communist Party of India’s (Marxist) study research centre since 1994. The first congress was convened under the leadership of the veteran Communist leader E.M.S. Namboodiripad. It was also the first serious attempt to find solutions to the problems that arose as a result of the distinct “model” of development that Kerala had followed until then.

Kerala was at that time falling behind other States in economic growth in spite of its remarkable achievements in the key areas of human development, particularly health and education, and a certain level of equity in the development process achieved through redistributive government policies, trade union action and peasant struggles. The initiative, “to protect the gains of the past and craft a viable path to the future”, which was launched with a call for a new agenda for Kerala’s development through a flagship democratic decentralisation experiment, was undertaken by a Left Democratic Front (LDF) government just when the Central government was beginning to push ahead with neoliberal economic policies that militated against such alternatives. Kerala has seen four State governments since then, alternately led by the CPI(M)-led LDF and the Congress-led United Democratic Front (UDF), which had contradictory visions on how to solve the State’s economic problems (see “Visions of development”, Frontline , February 14, 2003).

The fourth Congress on Kerala Studies has concluded with the concern that although the past two decades were a period of economic growth inequality has grown “in a fearful manner” in the State and the gaps between sections of people, agriculture and non-agriculture sectors, urban and rural areas, various districts, and so on, have widened.

According to the draft Kerala Development Agenda presented at the conference (on the basis of a series of seminars and symposiums on different sectors held earlier in various parts of the State), the gains of this economic growth have not benefited all sections of society equally. While there has been a tremendous increase in the earnings of the upper 20 per cent of the richest families, the earnings of low-income families at the bottom 30 per cent segment have fallen significantly. Such increasing inequality is a new trend in Kerala’s development experience, and several participants drew attention to it at the congress.

Addressing a symposium on “Changing Paradigms of Kerala Development”, Prof. M.A. Oommen, an economist, said: “The Kerala model of development has lost all its importance today. I think, of late, Kerala is witnessing a kind of political failing and, certainly, a social failing in the various sectors which were once upon a time the hallmark of the so-called Kerala development model. A highly commercialised education system and health-care system are facing a crisis and are now marginalising the poor and the backward communities of the State. Kerala has seen a transformation in the structure of SDP [State Domestic Product] and the allocation of labour, and a tremendous increase in the rate of per capita income. But this is only because of the huge inflow of foreign remittances into the State. This has considerably vitiated the whole scenario of the State. NSSO [National Sample Survey Office] and many studies have shown there has been a tremendous increase in the ‘Gini coefficient’ [an index of income inequality], capturing the increasing inequality in the State.”

The agriculture sector accounted for 55 per cent of the SDP in 1960-61 but now accounts for only 8 to 9 per cent. The construction industry then accounted for only 1.7 per cent of the SDP, but today its share is 15 to 16 per cent. Manufacturing was around 12-14 per cent but is now less than 7 per cent, he said.

According to the Kerala Development Agenda, the service sector continues to be the engine of the recent economic growth in Kerala, accounting for 70 per cent of the State’s income in 2013-14 (up from 60 per cent in 2004-05). But this service sector-led growth is largely dependent on the inflow of remittances from abroad, mostly from West Asia, where employment opportunities are increasingly on the wane. The unease that such a situation creates is because such economic growth cannot be sustained unless it comes as a result of an increase in physical production within the State. However, the production sectors continue to remain weak.

For example, Kerala’s agriculture sector, which 27 per cent of the total number of families in the State depend on for survival, is becoming more and more marginalised, with land increasingly being considered a commodity rather than a means of production. Moreover, the path the State chose for its industrial growth, with its focus on labour-intensive traditional industries and energy-intensive, highly polluting chemical industries, has almost reached a dead end.

Between 1997-98 and 2013-14, the agriculture sector grew by only 0.4 per cent. There has also been a dramatic decline in agricultural production, area under cultivation and income from and jobs in the sector. Agriculture and allied sectors, which provided 57 per cent of the total jobs in 1983, now account for less than 30 per cent of the jobs. Agriculture alone provides only 16 per cent of all jobs today. But the number of people who depend on agriculture for a living has remained almost the same and their income and living conditions have been adversely affected. Moreover, the decline in agriculture is already posing a serious threat to food security in a State which produces only 20 per cent of its food requirements.

Environmental awareness Significantly, the Development Agenda says that although it is important to protect the traditional industries which a large number of workers depend on for survival, such sectors cannot continue in the traditional way. Also, increasing environmental awareness, which demands strict pollution control norms, and Kerala’s energy scarcity are making the State’s chemical industries an unviable option.

The main weakness of the current service sector-led, Gulf money-based economic growth is that it does not create enough job opportunities in Kerala. Unemployment rates remain higher than the national average. More and more people are seeking jobs outside the traditional sectors. The educated have to wait long for jobs—the reason why they obtain more and more degrees, creating a huge demand for higher education—or engage in informal jobs. But their reluctance to do physical labour has led to a large inflow of people from other States in search of jobs.

“Kerala is importing about three million labour[ers] from other States. That is a major transformation that we have to take into account,” Prof. Oommen said.

Michael Tharakan, a scholar of Kerala’s social, economic and development history, said: “In the mid-1970s, Prof. K.N. Raj and others came out with an important study on Kerala’s development in which it was found to have had a very slow growth rate, but even with that the State was able to distribute that added wealth comparatively more adequately among its people. But things have changed. Kerala now has got a very high growth rate. Nevertheless, its distribution system is not functioning well now. There seem to be several economic reasons for this and non-economic issues as well.”

For example, he said, many studies have pointed out that the initial distribution system that was available in Kerala was supported by an enlightened group of people who were prepared to think beyond the interests of the group they belonged to. They were willing to fight for the rights of the people who were outside their immediate group. This resulted in the comparatively better distribution in the State.

But now, in spite of the fact that Kerala is slipping in many aspects, in terms of economic equality, gender equality, environment, and even on the question of climate change, the kind of movements that once used to challenge such trends is no longer seen in the State. “Is it a fact that the militancy and the ability of the people of Kerala to fight for the rights of all the people, and not just their own brethren, have declined?” Tharakan asked.

He pointed out that Kerala always claimed priority and superiority over other States in the fundamental areas of education and land reforms. “These two stories have some unfinished chapters, and unless we are able to do something about the unfinished aspects of the land reform question as well as the education question, we are likely to go on slipping back.”

For example, he said, in education Kerala has the numbers; it is way ahead of the Indian average in terms of graduates per square kilometre, total literacy, and so on. But the quality of education is not up to the mark, and secondly, an appropriate education system that could transmit democratic and development values seems to be missing. This is because a restructuring, in terms of development, educational and democratic values, has not been consciously introduced into the educational system. “So the State is slipping in that sector. As a result, we tend to become a group of people who are not bothered about the fact that marginalisation within education is on the increase. This kind of distancing is on the increase, and Kerala is not bothered enough because the people who benefit from it are those who are in the business of implementing the new policies.”

According to Tharakan, something similar has happened on the issue of landholding. Some sections of the population were kept away from landholding rights even while they were in the forefront of agriculture. They were the agriculturists but were excluded from holding land. This problem could not be solved even with Kerala’s “very successful, remarkable and comprehensive land reforms”. They were given a little bit of land, but that was not enough and it was mostly the worst kind of land that was transferred to the poorer sections of people. “So you have a big case of discrimination, a big case of distancing between people within Kerala society in spite of the achievements we have made in distribution in the earlier times. And that is now chasing us in the form of that discriminatory situation being injected with the ideas of communalism, fascism, denial of rights and equality and also the open denuding of our commons. So, unless we can rectify those mistakes, talking about what can be done about the economy will only be partial,” he said.

Prof. Oommen also drew attention to the fact that Kerala’s democratic tradition was being considerably derailed. “We are not upholding public reason. Public unreason is the order of the day. We have to take note that the deliberative democracy Kerala was famous for is now in retreat.”

For instance, he said, decentralised planning was an experiment done to recapture the lost vitals of Kerala’s development paradigm. “Decentralisation was a successful experiment in its early formation, opening considerable avenues for people’s participation and local development and promoting local democracy in the State. But today, a ‘routinisation’ of the whole process has taken place, making participatory governance a sham.”

The congress saw several interesting discussions on the problems affecting Kerala’s economy and society at nearly 70 venues.

The organising committee chairman and former CPI(M) State secretary, Pinarayi Vijayan, said: “The fourth congress is being held at a time when the UDF government has published a document on Kerala’s development. It is titled ‘Kerala Perspective Plan 2030’, but [it] has been prepared by the Delhi-based National Council for Applied Economics Research, by people who have no links with Kerala. As such, it does not reflect Kerala’s peculiarities or its development experiences. Moreover, commercialisation of all sectors is the general approach of the document. Its assessment about the main weakness of the health and education sectors that made Kerala famous throughout the world is that they have not yet been commercialised. The document similarly argues for the restructuring of all other sectors to help these commercial forces.”

Asked to outline the general nature of the solutions being proposed by the congress, Thomas Isaac, Director of the A.K.G. Centre for Study and Research and former Kerala Finance Minister, told Frontline : “We do not believe in competing with other States in giving more concessions and rights to corporates. But then, how will we attract investment to the new growth sectors? For this, two things are essential: one, we have to modernise physical infrastructure facilities in the State. Two, we have to expand and improve the quality of Kerala’s higher education sector. The UDF is proposing a total surrender to free market forces and corporates in all key growth sectors. They are proposing this not only in industry but also in education. We are instead thinking of a strategy of increasing investments under social control.”

He said the other highlights of the proposed new agenda included (a) total social security to those who still remained in the traditional industrial and unorganised sectors as Kerala invariably turned its focus on to new growth areas; (b) moves to ensure deeper involvement of government in development and not its gradual withdrawal; (c) new versions of the democratic decentralisation experiment to make governance more effective; (d) corrective measures to create a gender-equal Kerala to improve women’s participation in the economy and their social status; (e) offering promotion of culture a central place in the new scheme of things, with substantially higher resources for promoting good literature, art, music, cinema and drama for the common man as a counter to the ills of the “consumption culture” that accompanied faster economic growth and consequent rise in incomes; (f) environmentally sustainable initiatives for faster economic growth; and (g) critical interventions by progressive forces and mass organisations against the threat posed by imperialist globalisation and to offer support to the evolving alternative development agenda.

The fourth congress is soon to be followed by discussions and seminars in all the 140 Assembly constituencies in the State that will eventually help evolve a Left agenda for the State’s development before the Assembly election, which is due in April 2016.