No progress without land reform

Failure of ruling class to conduct substantive land reform has meant the preservation of entrenched power structures.

The failure of Pakistan’s ruling class to conduct substantive land reform has meant the preservation of entrenched power structures, persistently low agricultural productivity and a flourishing real estate sector populated by predatory elites looking to turn a quick profit via speculative trading. Big landlords operate as royalty across provinces, sitting atop valuable assets that could potentially be producing inputs for the manufacturing sector to boost exports — instead using them to exert influence and exploit labouring classes in rural communities. The process around which contestation for power takes place is also largely contingent upon landholdings, thus marking this domain as a central, and in many cases pivotal, determinant of governing relations. Without a consolidated effort to redistribute these holdings, Pakistan has little hope of moving forward on any front.

Perhaps the most fundamental concern about landholdings concentrated in the hands of a few families (5% of landlords are estimated to own 65% of the farmland) is that they allow these feudal lords to operate as gatekeepers to the corridors of power. ‘Electables’ are big landlords that possess coercive power over their respective communities — a significant percentage of which are directly dependent on them for survival. Landless peasants and tenant farmers are both at the mercy of the landlord and in many cases ‘bonded’ to him (it is invariably a him) via debt. This leverage makes them attractive candidates for political parties to award tickets to, as they can rest assured of ‘vote banks’ without having to worry about winning support through persuasive means based on ideological appeals and/or policy manifestoes. Landlords naturally respond to this by carefully weighing out offers from all parties — in most cases simply representing the security apparatus — to strategically maximise their returns, which can come in the form of monetary rewards, political capital and other gifts/favours that enhance their authority and sphere of control. Any party seeking to win seats in provincial or national assemblies must necessarily engage with landlords at some level in order to stand a chance: no ifs and buts.

Secondly, the economic aspect. Dormancy in land — and agricultural land in particular — has tended to prevail across Pakistan as landlords have little to lose if they wish to simply hold the asset for as long as possible with the intention of selling it off at a (massive) profit in the future. With a tax system that is ill thought-out at best and simply non-existent at worst, it makes no difference whether the land is being used productively or not. This is despite evidence from across the globe — particularly among countries such as China, Taiwan, Japan, and even India — that demonstrate the direct link between land reform and higher agricultural productivity. This has been achieved by breaking up holdings into parcels and renting them out to smallholders who have a real incentive to then minimise costs through continual innovation — eventually enhancing productive capabilities and drastically expanding domestic output of key crops which can then be used as inputs to the manufacturing sector, fuelling industrial growth and leading to higher exports and better current account positions.

The complete absence of any kind of governing oversight on land relations — with no systems or institutions in place that ensure transparency in the domain — a flourishing real estate sector has propped up in an “atmosphere of opacity, under-regulation, under-taxation and legal inconsistencies”, to quote from activist-academics Ammar Rashid and Aasim Sajjad Akhtar. This involves large-scale land grabbing, whereby entire regions are captured by powerful individuals that are practically above the law and converted into elaborate ‘housing schemes’ targeted at the affluent. The vast majority of these remain unoccupied for extensive periods, with an entire market based on the trading of ‘files’ in place for elites to place their bets on in anticipation for a quick return. It also bears mentioning that a significant proportion of the players in this domain are expatriates looking to ‘park’ their wealth, a phenomenon that began in the early 2000s when close monitoring of financial flows in countries of settlement had begun. Societies that are populated, on the other hand, are structured in a manner that ensures total insulation from the outside: with private water, security, electricity, entertainment, etc in place, thus contributing to the increasing divide between the haves and have-nots. To quote activist-academic Ammar Ali Jan, “Considering the social, economic and political insularity of the Pakistani elites, it would be fair to say that they are heading the most successful ‘separatist movement’ in the country, a movement that seeks to insulate itself from the squalor and abandonment reflected in the experience of millions of Pakistanis.” Indeed, many of the gated housing societies located are made possible by the violent destruction of settlements. In cities, these constitute informal settlements catering to poor migrants from the countryside; while in rural communities they are the ancestral homes of various communities with deep sociocultural roots in the territory. A quite literal manifestation of class warfare.

Going forward, it is absolutely essential for Pakistan’s governing elites to understand that economic prosperity is not a technical endeavour but one based within power relations. Markets can only truly function and evolve if they receive a regular stream of voluntary participants. This is impossible unless ordinary people have the means to break out of the poverty trap, which current land relations do not allow.

Comprehensive land reform must involve, first and foremost, the careful mapping out of land ownership to establish clarity on the landscape. Provincial Boards of Revenue must take on this responsibility and move towards modernisation/digitisation to streamline the process. Once this is done, a careful incentives-based policy ought to be put in place that allows landlords a particular window of time to demonstrate that they are utilising their holdings in a productive manner — the failure of which would mean seizure by the state and either redistribution to local farmers or the leasing out to tenants with little to no strings attached. In the immediate term, progressive land taxation ought to be imposed (based on acres held) to disincentivise both dormancy and speculative trading; and farmers’ associations liberated to challenge the domineering presence of landlords in rural settings through collective organisation.

Democracy simply cannot prevail under current land relations, which are a direct or indirect product of (arbitrary) colonial era allotments. Economic justice necessitates radical reform. Now.

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