ISSN (Print) - 0012-9976 | ISSN (Online) - 2349-8846

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Entangled Agrarian–Urban Land Markets in Regional Mumbai

Seeing Mumbai through Its Hinterland

The “money in the city, votes in the countryside” dynamic meant that in the past, agrarian propertied classes wielded enough power to draw capital and resources from cities into the rural hinterland. However, as cities cease to be mere sites of extraction, agrarian elites have sought new terms of inclusion in contemporary India’s market-oriented urban growth, most visible in the endeavour of the political class to facilitate the entry of the “sugar constituency” into Mumbai’s real estate markets.

Scholars often pose a puzzle of Indian cities: why do some of the richest cities in the country suffer from crumbling water pipes and potholed roads? (Varshney 2011; Bjorkman 2015) If India’s cities generate nearly 85% of the country’s gross domestic product (GDP), why are these urban revenues not invested in better urban public services? To some political scientists, the answer lies in India’s political–economic paradox: economic power is concentrated in cities, but political power resides in villages (Varshney 1995). The agrarian countryside may contribute less than 15% of the GDP, but it is also home to a populous 80%–85% of the electorate. Politicians cannot afford to ignore agrarian interests without grave negative losses at the ballot boxes. It is this configuration of political–economic power that explains why “for politicians, the city has primarily become a site of extraction, and the countryside is predominantly a site of legitimacy and power” (Varshney 2011).

The electoral power of the agrarian countryside is evident in the relationship of Mumbai to its hinterland. India is the second largest exporter of sugar in the world and more than 40% of India’s sugar exports come from the western Maharashtra region. Sugar production in the region is organised in the form of cooperatives. These sugar cooperatives have been heavily subsidised by the state: 90% of sugar cooperative finances came from debts from the cooperative banks with state guarantees; over three-quarters of the 10% equity was a direct handout from the state budget (Baviskar 1980; Attwood 1992; Jadhav 2008). It was Mumbai’s thriving industrial economy that was the source of sugar subsidies. Mumbai’s industrial classes tolerated the diversion of capital from the city to the countryside, as they understood that the state government legislators relied on the numerically strong peasants for their votes, and that capital diversion was the price to be paid for the political stability derived from subsidised agrarian prosperity.

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Updated On : 27th Mar, 2018

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