The Kerala Model–A Critique

T G Jacob

The enigma of Kerala is created as well as historically sanctioned. The formation of the present administrative unit on the basis of Malayalam language in 1956 was immediately followed by an interesting episode, namely, the coming to political power of the Communist Party of India through a peaceful constitutionally provided democratic election process based on adult franchise. This party had existed and led struggles of the subalterns for quite some time and after the withdrawal of the Telangana armed struggle in 1951 had unconditionally embraced constitutionalism, surrendered all arms, and entered mainstream parliamentary politics. It was not only in Kerala that they won the assembly elections; they made an impressive show in Andhra Pradesh too. The transformation of the CP was symbolised by abandonment of the programme of a revolutionary overthrow of the status quo and the installation of a reformist economic programme in its place. This stream had always been very strong in the party, especially among the central leadership. This formal changeover followed the shift in the class nature of the state post-1947.

By no means did the Communist Party led State government in Kerala attempt any major radical measures undermining the given socio-economic structure; it only tried to implement certain reforms advocated and promised by the Indian National Congress, the ruling party of the country as a whole. But even this little was a bit too much for the entrenched dominant interests and they staged a ‘liberation’ struggle and ousted the State government. This ousting of the democratically elected government failed to generate rethinking about the nature of the politico-economic system and the strategy of working within it. On and off the Constitutional communists, also called Official communists, have been coming to power in Kerala and over a period of several decades they themselves have become an established socio-economic power to be reckoned with in the State.

The Social Democrats initiated several welfare measures and coined the phrase “Kerala model of development”. Politically, it amounted to self-praise. The gist of this model propagated for emulation by others was that it is possible to achieve higher levels of development and even progress, if there is a political will to bypass the linear model of development of productive forces. Distributive equity/progressive policies can bring about a higher quality of life without the usually required growth of productive forces. What exactly there is to be distributed and among whom was not seriously thought about.

Higher quality of life was identified and achieved with higher life expectancy, lower infant mortality, universal literacy and general education, better communication facilities, near total electrification, near total primary health coverage, and so on. However, soon after propounding this ‘model’ unsavoury characteristics like large per capita debt and the phenomenon of accumulating new debts to service old debt, which shows bankruptcy, came out in the open.

Earlier it was often said that Kerala remains backward in terms of growth of industrial capitalism because the workers are not disciplined and are prone to disrupt production. This behaviour was awarded to the influence of communist ideas, which dissuades prospective investors from investing. Now scarcity of labour is given as a reason for lack of investment. This scarcity is due to the phenomenon of large-scale out-migration of skilled, semi-skilled, and manual workers to the Arabian Gulf countries attracted by relatively higher wages. Now this out-migration has reached its limits. This migration of hundreds of thousands of productive youth has given rise to a large flow of overseas remittances which injects economic buoyancy mainly of the variety of enhanced consumption both durable and transient. Land has assumed rising monetary/speculative value due to the construction boom largely accounted for by remittances. This has also meant decreasing productive use value of land. Conversion of wet land to dry land has gained momentum contributing to a drastic reduction in food production and increasingly chronic dependency for basic food needs on outside regions. Labour for the burgeoning construction sector mainly comes from outside the State and is paid well. It is interesting to note that just as the Malayalee worker went to the Gulf for higher wages now workers from Eastern India are coming to Kerala for the same reason. A skilled Malayalee carpenter or mason can now earn more by instructing and managing the migrant youth than by working for wages. They cannot be viewed as workers in the real sense of the term, rather they are now petty bourgeois overseers exploiting the migrant workers and living a middle class life through surplus extraction from the actual workers.

This tendency already existed earlier. The astounding phenomenon of “nokku kooly”, i.e., wages for simply looking on, had already become standard practice among the unionised head-load workers. They are not supervisors or overseers but only lookers-on assured of money for work they are not doing.

It is also noted that for any small-scale construction work like that of a single house at least 60% of the total cost is accounted for by direct wages. This is inordinately high on all accounts. Along with this distortion add the callous irresponsibility rampant among the Malayalee ‘workers,’ which invariably pushes up the cost further. This irresponsibility is perhaps a by-product of basic scarcity of labour power. But it can equally be the result of an anti-work parasitic culture nurtured by the possibilities of easy living, its attendant psychology and all-pervading consumer culture. It has nothing to do with class consciousness or class struggle, though simple-minded social democrats may say that it is all class assertion and class power. Anti-work culture and parasitism is certainly not a characteristic of a producing working class, it is the characteristic of those who live by the labour of others. In this context it is worthwhile to note that on an all-India level the bulk of wealth production is done by the unorganised labour force, and even in modern large-scale industries like metallurgy, ad-hoc conditions of labour employment is the dominant trend since quite some time and the organised, unionised workers, who enjoy security of employment, higher wages and a number of perks are often a small minority in such industries. This trend has percolated into the education ‘industry’ also. The worker aristocrats are often the worst enemies of the insecure casual workers when they try to raise any demands for the improvement of living and working conditions.

The basic argument is that labour and labour processes existing here are to be redefined as they are incompatible with the prevalent conceptualisations of working class and its social and political role.

Production of essential food is grossly deficient in Kerala. Rice, the staple diet, is mostly imported from other States; so are vegetables and meat. Of late, even fish has started to come from Karnataka and Tamil Nadu. This has many serious implications for the people as a whole irrespective of classes. Food security/insecurity is not only an economic variable but also a highly potent political one especially in an overall system where even the watered-down federalism that is in place is on the waning side with centralisation of economic and political power in the ascendency.

The most visible change that has happened in Keralan agriculture during the last half century is the drastic reduction of acreage under food crops, especially that under paddy. The most often heard reason for this reduction is the shortage and high cost of labour power; and paddy cultivation is a labour intensive affair. Farmers who shift to other crops or let the fields lie fallow often talk about paddy cultivation as an economic loss. This is certainly not in any absolute sense of loss and profit, the term “loss” here is only in a relative sense. Even that is doubtful. The fact is that a good number of agriculturists are only nominal agriculturists. They may own paddy land but professionally they are not agriculturists. They would prefer to lease out the fields or alternately allow them to lie fallow. They may also allow the land to be destroyed entirely by leasing it out for brick kilns. It is a common sight to see uncultivated paddy fields. It is even more common to see paddy fields converted to cash crop land. These cash crops are generally ginger and bananas, both exclusively for the market. In other words, speculation enters the scene.

Another trend in land utilisation pattern is the conversion of wet to dry land, a direct result of the increased availability of disposable money, a contributory factor of which is the increased flow of remittances from abroad.

The wet lands became the casualty to this greed for dry land. To make them dry they have to be raised, which needs soil. The conversion process, therefore, necessarily leads to geographical distortions in some other lands. On the one side, wet lands cease to be water storages, and on the other, hillocks become flat. In fact, buying soil becomes a significant item in the cost of construction of a house. Moreover, construction needs an enormous amount of rock mining which becomes seriously debilitating to the stability of the whole place. Thus one sees that the multiplier effect becomes all- encompassing with sure-fire consequences for the structural stability of the land itself with the result that disaster management has emerged as the newest industry.

The built-up space in the State is estimated to be more than what is required and the amount of built-up space lying vacant is also significant. This means that the investment that went into it is dead.

Many of the cash crops currently grown in the State were found in the wild and the collection was being done by the peasants or Adivasis. Linked to the ports through a chain of intermediaries using the inland waterways they were exported by Arab, Syrian, and Jewish traders concentrated in the then sea ports on the Arabian Sea coast. The local chieftains derived incomes through taxes on this export. The British introduced organised plantations after clearing forests and also established big plantations of tea and coffee, the growing of which soon percolated to local small growers too. While tea remained confined to big plantations in Kerala, coffee became a predominantly small grower crop. The list of cash crops grown in Kerala is quite large and it keeps on growing, vanilla and cocoa being the latest additions. A few herbs are also grown commercially now, a direct result of large-scale commercialisation of Ayurveda partly triggered by the growth of medical tourism.

The market/money value of cash crop products constantly fluctuates. These money values are determined by a variety of factors among which export-import policies play a crucial role. The cost of production which includes cost of labour power, energy, and chemical inputs are ever on the increasing scale. This creates a basic disequilibrium between costs and returns and hence vitally affects the economic well-being of the growers. The same is the case for food crops grown for the market.

As such the slot of Kerala in the general scheme of the geographical division of labour is as primary producer and as producer of labour power. The tragedy is that labour power is mainly exported on an all-India and global level, and primary production has grown at the expense of basic self-sufficiency while simultaneously functioning as a conduit for super-profit making by corporate businesses.

There is growing thinking in Kerala about the need for stable economic conditions. Ultimately this means breaking out of the present slot of labour power exporter and primary producer. Developing value-adding processes and finding local, all-India and global markets for the value-added products is the challenge.

Every cash crop grown in the State is suitable for value-added diverse products and the home market itself is big enough to begin with.

When one takes the availability of banking facilities it can be seen that Kerala rates number one in the entire country. It is a pioneer in cooperative banking apart from having the highest density of normal commercial banking establishments. Mainly due to the heavy inflow of remittances the amount of deposits is high but the same cannot be said about the amount of credit advanced by the banks. In fact, for a long time the credit-deposit ratio was abysmally low and even now it has only marginally improved. When one looks at the all-India picture there are incredible differences between different regions of the country. It is high in the Gujarat-Maharashtra belt while in Kerala it is low, even though the State has a higher density of banking and per capita deposits. This means that the banking system is working as a very efficient conduit for suction of investible surplus from Kerala.

Kerala is well-recognised as a good foreign exchange earner. Overseas remittances, export of primary products like spices, earnings from international tourism industry are the main components of these foreign exchange earnings. Of course, these sources hike the money circulation in the place and increase income levels in rupee terms. But how and who expends these hard currency deposits does not come within the State’s economic rights. The utilisation of dollar or any other hard currency deposits is decided at the Centre and the States have no effective voice in such decisions.

When thousands of primary producers killed themselves in the cash crops belt of Kerala due to being caught in a debt trap the farmers organised themselves to demand a debt moratorium. Mainly leading public sector banks were targeted. In Wayanad—the hub of the agitation—the concerned lead bank even threatened to wind up its operations in retaliation. Apparently the logic of the banks conforms to sound banking principles; it is that they are not responsible for un-remunerative prices of agricultural commodities, and credit is a commodity with its own costs on which the viability of the banking system itself is based. However, this logic, when it comes to actual practice becomes blatantly one-sided and discriminatory. Erstwhile profit-making public sector banks are now in doldrums not because of agricultural loans but corporate loans and even outright theft by corporates.

The products’ market is another sordid story that is entirely out of the primary producers’ control. The demands for “remunerative prices” or MSP become the rallying cry for the farmers’ movements.

The dependency of the State for basic goods and services on outside areas and peoples is all prevalent.

One of the most visible after-effects of the consumption spree is the difficulty of disposing both inorganic and organic waste. When people look at popular struggles, often localised, it is found that they mostly relate to environmental issues and among them the maximum relate to unscientific waste disposal. Dumping waste from urban areas into the rural areas is commonly reported and several such struggles are long-drawn-out attracting the attention of the entire people. Reports of waste being transported in trucks to the neighbouring States of Karnataka and Tamil Nadu under cover of night and dumping it on the roadside in those States inviting hostile reactions is also common. Disposal of waste is quite a messy problem facing the whole State, especially the urban areas. There is simply no space and infrastructure to dispose the waste generated safely without creating environmental hazards.

Another visible aspect of consumption in the State is the medical industry. The health industry thrives in the State with a very large number of privately owned hospitals and allied health services in every nook and corner of the State. Hospitals are invariably multi-crore businesses with all kinds of necessary and unnecessary equipments, often imported, which dazzle the customers. Even before the doctor conducts a preliminary examination of the patient half a dozen tests are routinely ordered. Of course, the hospital gets a hefty commission from the laboratory, if it happens not to be part of the hospital. The hospital is constrained to make a minimum amount of money every month whether there are a sufficient number of patients or not. Unethical practices abound like insisting on surgery even when not really required, prescribing unnecessary medicines, or insisting on admitting the patient when it is least necessary.

The State grows fairly good quality coffee. A variety of finished products like instant coffee can be made that do not involve inaccessible technology or mega capital outlays. But the production of instant coffee is controlled by a couple of multinational companies out of which Nestle is the foremost.

Before the invasion by the hybrid seed agriculture technology Kerala had a large variety of indigenous varieties many of them being fragrant types like Jeerakashala and Gandhakashala grown in the lower Western Ghats region. Now the cultivation is less than in earlier days but these varieties are still cultivated. It is a local crop and the grains are used on special occasions like marriages. It is considered ideal for preparing the fabled Malabar Biriyani. From superlative front page advertisements in the prominent local newspapers for this rice, it is found that the product is owned and marketed by an agro corporation operating from beyond Kolkata, more than three thousand kms from where it is grown.

Every part of the coconut tree that abundantly grows in Kerala can be put to human use. Its oil is used for cooking purposes. The coir industry is based on the fibre extracted from its husk. Tender coconut water and fresh palm toddy (Nira) are wonderful health drinks. Toddy can be used for making value-added products like jaggery. The mature tree yields hard wood and the leaves provide excellent roofing material. Little wonder that it is known as a wish fulfilment tree.

Toddy can be used to produce hard liquor as well. Liquor is a State subject, which perennially cash starved State governments find convenient to ruthlessly farm. It is a fairly inelastic commodity in relation to price changes; whatever the price, demand is more or less assured, and it is this characteristic that is exploited to the hilt. The contracts/licenses to operate the shops for a certain time are auctioned to the highest bidder. Kerala, a chronically debt-ridden State, depends on excise revenue from liquor even for the day-to-day working of the government. This has been the condition of State finances since many years with no alternative to this source of revenue. Under such conditions the liquor lobby enjoys growing economic and political power in the State.

The adulteration is so much that consumer taste itself has metamorphosed to the extent that if by chance a consumer is offered genuine toddy he may probably denounce it as adulterated.

Another story is that of the massive market manipulation in the 1980s to kill coconut oil as a cooking medium. The effort succeeded too at least in the short run in Kerala. Suddenly there was a spurt of literature in the popular print media about the dangerous character of coconut oil authored apparently by health and nutrition experts. The propaganda was concerted and alarmist that the use of coconut as an edible oil drastically increases the cholesterol content in the human body directly leading to serious health hazards involving the heart. People got scared and dropped their favourite cooking oil. Prices reached rock bottom. The stocks were purchased by companies like Tata Oils, who use it mainly for manufacturing goods like soaps, shampoos, hair oil etc.

The hundreds of thousands of growers have learned to live with the ‘uneconomic’ tree. The research and promotional institutions set up at public cost do not have the motivation or the capability to solve the problems besetting the tree. They are there for the sake of employment and income for ‘experts’.

Considerable stretches of the coast in southern Kerala are of black sand, which is the ore for monazite and limonite, two minerals of great strategic and commercial value in the global market. They are collected in large quantities, subjected to primary processing, and shipped to rich countries to be further processed and used in their electronics, armaments and/or nuclear industries. The natural radiation levels in the mining areas are high and this is greatly augmented by the mining and primary processing. Large numbers of inhabitants are plagued with wasting diseases for which there is no cure.

Of late, granite mining has become a sensitive topic in Kerala. Kerala has extensive granite formations beneath a not very thick but fertile top soil. For the past few decades this granite is being recklessly mined particularly in the hilly regions. It is a high profit business but the area of mining becomes totally useless once the mining is over.

The attitude to women shows no religious and community bias in Kerala. The upper caste Hindus both traditional and co-opted, the casteist Christians, and Muslims display a similar character when it comes to women. Casteism is also common to all of them. Only the Adivasis, and to a lesser extent the Dalits, are exempt from this reactionary approach.

[This is a shortened version of a longish piece.]

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Vol 55, No. 13, Sep 25 - Oct 1, 2022