Vani Swarupa Murali on the Lack of Decentralization in India and Its impact on Water Depletion

SHRUTI RAJAGOPALAN: Welcome to Ideas of India, a podcast where we examine academic ideas that can propel India forward. My name is Shruti Rajagopalan, and this is the 2023 job market series, where I speak with young scholars entering the academic job market about their latest research on India. 

I spoke with Vani Swarupa Murali a PhD. Candidate and an instructor at the South Asian Studies Department in the National University of Singapore (NUS). She has a Masters in Asian Studies from the S. Rajaratnam School of International Studies, Singapore. Her research lies at the intersection of political science and agricultural policy and environmental governance. We spoke about “When Sowing is not Reaping: Decentralisation, Groundwater Extraction and Agrarian Livelihoods in Tamil Nadu.” We talked about the overly centralized administrative, political, and fiscal Indian state, its impact on farmers’ livelihood, groundwater depletion and other environmental consequences, and more.

For a full transcript of this conversation, including helpful links of all the references mentioned, click the link in the show notes or visit mercatus.org/podcasts.

Hi, Vani. Welcome to the show. It is such a pleasure to have you here.

VANI SWARUPA MURALI: Thank you so much.

RAJAGOPALAN: In your case, I actually got your entire dissertation: “When Sowing is not Reaping: Decentralisation, Groundwater Extraction and Agrarian Livelihoods in Tamil Nadu” to read, which was such a joy. You’re, of course, interdisciplinary, but mainly political science, political economy, and you’re studying one of the subjects that I’ve been thinking about for a long time, which is the impact of centralization versus decentralization on different parts of our economy. You’re looking at this in the case of agriculture, in particular, from the lens of inequality and livelihood of small farmers due to particularly poorly designed decentralization schemes.

You also talk about this in the context of irrigation in Tamil Nadu and groundwater in Tamil Nadu and so on, which we’ll get to. Can you just walk us through what was your lens when you were looking at this problem and what is the scope of it? What is unraveling in India when it comes to agriculture?

MURALI: Yes, sure. My background is in political science, and so my main topic that I was gearing towards—I did research for someone who worked on agriculture. We were looking at things like cropping data, yield per hectare, area, and all that kinds of stuff, and so that really got me interested in the field of agriculture.

When I was looking at it from a broader lens, it came to me like this question of why farmers, despite being the people who are most affected by climate change, do so little to mitigate it. That’s just something that puzzled me from the start and even after I went for my first round of fieldwork. When I got there, like you mentioned, I looked at groundwater irrigation, and I was just so confused because they were getting so much water out of the ground despite saying things like, "Oh, we’re running out of water. When there’s a drought, we really struggle," and things like that. I was just really puzzled with this from the start.

My supervisor, she was amazing. She veered me in the direction of it’d be good to address this issue not just from the bottom up from the lens of the farmer, but also understand why it happens from the top down, so the question of how the government approached this kind of a topic. When I was doing that, I would see this gap between the official narrative of how the government functions and what the farmers actually go through on the ground, that kind of a gap, that inequality basically came to the fore.

Then that was my hypothesis, basically, whether decentralization leads to inequality. In that question, I then discovered so many other types of inequalities along the way that manifested to: large farmer versus small farmer, rich versus poor, and things like that, caste dynamics as well. That’s the lens that I was getting to it.

Why Agriculture Has Yet to be Decentralized and the Gridlocks That Prevent It

RAJAGOPALAN: Before I get into what you find in terms of the exact dynamics and how they play out in terms of either social economic strata or caste or, in your case, also region, I want to first understand your exact critique of the highly centralized nature of the Indian state. The way economists typically look at it is since the destruction of license permit raj, you’ve seen enormous decentralization to market forces in other areas, but in the case of agriculture, we never quite implemented those reforms. We never decentralized to the market.

There’s another kind of decentralization which is going on which is between the different levels of government, and in particular, after the 73rd and 74th Amendment. Can you walk us through this transfer that you’re talking about, whether it is responsibility, whether it’s finances, whether it is supervision, and so on?

MURALI: Yes. Like you said, so when you come from an economic standpoint, the classic criticisms of essential planning are things like devolution of market forces and things like that. When you come from a policy point of view, my main critique was that it is difficult to efficiently cater to supply and demand on the ground. They can’t respond to the needs on the ground effectively or efficiently, and so basically criticizing the inefficiency that it breeds.

I guess also it hints at one of the things that scholars suggest that decentralization does is that it gets rid of corruption. I also address that in saying that that’s not really the case because when a farmer wants to sell his produce to the market, he has to pay a bribe. These kinds of things also come up. Most people who argue against central planning provide decentralization as a solution, but I argue that there are still gridlocks that are there despite attempts at decentralization.

There are inefficiencies that still take place in the decentralization process, and these bottlenecks can also occur at much lower levels of decentralized structures. Inefficiencies can happen at the district. They can happen at the block levels. Rather than suggest decentralization as a solution, I argue that there are problems there as well and so the local context really needs to be privileged.

RAJAGOPALAN: In this case, can you give us an example, I think, that might make it vivid about what kinds of gridlocks you‘re talking about because we all understand state versus market reasonably well, but the nitty-gritty of what you are writing about is less visible to all of us?

MURALI: Basically, what I did in the dissertation was that I broke it up into three types of decentralization, so administrative, political, and fiscal. In the first section on administrative decentralization, my main issues were that it’s like oil and water, which is what I named that chapter. It’s just a sense that there is some kind of an invisible barrier that prevents the two from meeting. If you look at the causes, I would suggest it would be things like there are these kinds of complex bureaucratic structures and competing jurisdictions on the ground.

For an example, I would say that let’s say there’s a nodal officer on the ground who is implementing let’s say PM Kisan, for example, implementing the scheme. He then goes on the ground and he gets feedback from the farmers, and they tell him things like, “Oh, my cattle is really sick. I need veterinary support,” but that’s not his jurisdiction. He’s only there to do one thing, which is question them about the finances.

There’s a lot of these kinds of competing jurisdictions even when you look at things like the Agriculture Department versus the Agricultural Engineering Department. One side is just extremely technical and then one side is extremely policy-driven, and the two ends never meet, which then causes a lot of problems. There are issues where administrative officials are extremely burdened, overburdened, I would say. For example, the case of the nodal officer. These lead to things like poor implementation and poor enforcement of policies that are there and are trying to be implemented but they just can’t. That’s in the case of administrative.

In the case of political, I would say there are definitely cases where the electoral office tries to implement things that are catering to, say, SC/ST communities or different classes or different gender. Sometimes the way that it reaches the farmer is that it’s not genuine, they’re just coming to me with these kinds of freebies just before elections, and they start looking towards that. They’re saying, "Oh, don’t worry. In three years’ time, they’ll come with some kind of a discount and it’ll be fine." That kind of rhetoric comes out and so that’s where these kinds of examples, I guess, flourish.

The Politics, Economics, and Superstitions of Groundwater

RAJAGOPALAN: In this instance, in particular, you’re looking at groundwater, right? Now what are the politics and economics of groundwater, in your case, in the state of Tamil Nadu, which is also a major paddy-growing state, but also a state that can be drought-prone depending on the time of year? The standard narrative on this is that it is the electricity subsidy and the water subsidy which completely distorts the incentives of the farmers, right? You’re saying that’s not it. There’s much more to that story. Where does that take us?

MURALI: I guess when it comes to groundwater irrigation, when it began, it was this question of, "Oh, we need to increase production, and therefore we start digging deeper and deeper." It’s now come to a point where sometimes you dig so deep, and you still get nothing. That’s the approach that I take. When you’re thinking about things like this, really weird power dynamics come into play. Farmers start to rely on things like luck. They say things like, "Oh, there’s this guy, he lives near us and he carries a coconut and he walks on the field. Then if a coconut stands up, it means there’s water below."

They tend to rely on these kinds of weird, superstitious things rather than calling on the agricultural department, for example, for soil testing or something like that. The power dynamics has really shifted on the ground. I would say now a lot of people are concerned about it, but there have been cases like, for example, in Rameshwaram where there has been a ban on digging of groundwater or wells which hasn’t really happened at all because it’s a pilgrimage place and people go there, and they need a lot of water. There are hotels, there’s tourists’ needs, things like that, and so it hasn’t been implemented and it hasn’t been enforced.

The Power Dynamics and Incentives

RAJAGOPALAN: Is this a question of really power dynamics or is it just a more simple case of lack of state capacity, for instance? The Indian state, especially at the state and local level, doesn’t quite have the bandwidth or the intent to enforce its own rules. Its own rules also get muddied by the fact that one set of incentives is to put in more bore wells through the subsidy. Then another set of incentives is, "Oh, we’re banning this for this other reason, which is non-agricultural." Can you walk us through that? I think what I’m trying to understand is where does the power dynamics set in and where does the incentive story end?

MURALI: Yes. I guess when you’re talking about power dynamics, so I looked at it from a sense of central, state, district, block, village, right?

RAJAGOPALAN: Yes.

MURALI: When you are talking about the village level and even if you try to go to local village level leaders, they tend to cater more towards the richer farmers. Even when I ask them things like—if you go to a small farmer and ask them what is their biggest problem, they would say, "The prices are unremunerative." That’s their biggest concern. You go to these local level leaders, and you ask them, "Hey, why don’t you fight for these kinds of things?" They say, "No, the biggest issue that we have is what the local elite, the larger farmers, want, and so we champion for those people because they’re the ones who fund us," or something like that.

I would say that the incentive structure, it trickles down to a point, but like I said, it becomes a question of, “How much do I trust the government and how genuine do I think they are?” For example, some of the things that came up in my interviews were the micro-irrigation scheme. A lot of them said, "Oh, people came over and then they helped us to install it, and then they told us the benefits of micro-irrigation." Then when you turn around and you look, the micro-irrigation pipes are just stored in the shed, they’re not really used. When you ask them why, they say, "Oh, they didn’t tell us how to maintain it, so it stopped working."

Even if they take on the benefits, it’s not long-term per se. They’ve also got frustrations with the government. For example, one of the cases said that, sure, there’s the crop insurance scheme, but even as recent as December 2022 when there was the cyclone, those who put in their claims for the crop insurance scheme, they just got rejected with no reason or they never heard back from their insurance companies. To them, it’s very flashy, you come up with these schemes and incentives, but then either the benefit is not genuine, super short-term just during election periods, or it doesn’t last in the long run. It’s not sustainable. I guess that’s where the issue lies.

How Information Sharing Becomes an Issue in Centralized Systems

RAJAGOPALAN: I guess the other thing I’m grasping from this is you have a central government scheme or a state government scheme which the local government level just can’t implement because once the central government gives out the subsidy. There is no way to provide information, to provide any kind of tutoring, to provide maintenance, to troubleshoot or resolve disputes. This we keep seeing over and over again in other claim-making spaces, but the micro-irrigation is a really interesting example of this in the case of agriculture.

One of the things that I learned from your dissertation—Again, this was very interesting to me as an economist because I normally look at everything from the broken incentive structure, and there’s plenty of that to go around in agriculture. Your critique is also the information sharing problem or the information asymmetry when systems are too centralized. Can you give us a couple of examples of that? Then I also want to talk about the farm bills, but first more generally, what’s the issue with information sharing when things are too centralized?

MURALI: I guess it comes back to that same issue of that micro-irrigation example. If we just go on with that, a lot of issues tend to center around the maintenance of the policies. For example, information that should have been shared would be things like, "Oh, salinity is a huge risk when you implement micro-irrigation pipes, so you will need to clean that out. There are certain chemicals and acids that need to be used in order to clean these micro-irrigation pipes." That never came through with the farmers. They were more so told to tick it up. It became more like a KPI, for example, like a numbers thing where we need to say that we’ve implemented it in 100 villages and it’s a check.

Even when it comes to demonstrations, it’s similar. It becomes more of a numbers game, "Oh, we’ve demonstrated to 120 people and they’ve all signed and said, ‘Yes, we’ve watched the right demonstration,’" but it doesn’t really transfer on the ground, I would say, in the sense of how sustainable a policy is. In that sense, there is that information asymmetry. Also, when it comes to taking on, let’s say, a micro-irrigation policy, there are a lot of things that need to be factored in. For example, sure, they might say you’re taking up the micro-irrigation scheme, but there are a lot of costs involved.

For example, the information is so detailed and so technical that it’s very difficult for an average layman farmer to grasp. They say things like, "Oh, your pipe diameters needs to be 63 millimeters if you are on a farmland of 2 hectares, and that will cost X amount." The charts and tables that are available are just so technical that I felt like I need to be [an] engineer to read this.

It was just, "Oh, if you’re having a pipe of 64 millimeters, the spacing needs to be 5 times 5 millimeters," and things like that. These are such technical nuances that just does not translate to the layman farmer. It’s so difficult even for us to grasp, let alone them. In that sense, implementation, it’s just very different on the ground than what it seems. As a policy, micro-irrigation seems excellent. It seems like the way forward in terms of irrigation and sustainability, but just does not translate.

Unraveling the Web of Trust and Inequality in Indian Agriculture

RAJAGOPALAN: Here I want to pivot a little bit to the farm bills that were introduced by the Modi government a few years ago that were then held back. They were a source of enormous protest. This is partly the motivation for your entire study. What I grasped, again, from what you are saying is you are providing a slightly different critique of centralization, and this is from the point of view of both information sharing and trust.

Your critique is even though the farm bills actually made economic sense and a lot of details of the farm bills benefited the farmers, they would have helped them eliminate the middleman, get a better price and so on. And you walk us through that briefly, they just refuse to accept them because there were larger fears.

Is the fear coming because it’s a miscommunication? Is it coming because there’s a lack of trust? Is it because they are seeing this as the first step of a longer process of rationalization where all the subsidies that they’ve gotten used to for three, four decades are going away, or is it just more simply a protest against a very high degree of centralization? That farmers in Punjab and Haryana or Madhya Pradesh and Tamil Nadu need to do this on their own with their own governments, and they don’t want a central authority. Can you parse this out for us because it’s all so tangled up? I guess it’s useful to ask you to help us parse it out.

MURALI: For sure. The farm bills was definitely something that inspired me to take this up as a subject. Interestingly, it was not such a big deal in Tamil Nadu because Tamil Nadu is traditionally pretty autonomous in that sense. A lot of things that happen in the center don’t ruffle as many feathers in the South as they do in the North. In that sense, the farm bills, they do tend to hint towards something that I’m talking about largely, which is this lack of trust.

Like I say, even though they make economic sense. It does make economic sense that if you open up to markets, there’s a larger growth strategy involved. Things like that definitely help out, but this lack of trust has led to a paranoia. It’s this sense that you’re saying this, but then who knows what you will do next. That kind of a paranoia, I trace it to the fact that it stems from a lack of trust in the government apparatus and it also points to the distinction between center and state divisions.

The center might implement a certain policy, but a lot of states opted out of it and they refused to implement it. That kind of a distinction, it also points to a lot of, I guess, disjunctures between the center and the state, even in terms of, if we bring it back to Tamil Nadu, the funding structure. Center implements a lot of policies and they’re willing to fund it, but how the state uses that money is open to interpretation. In saying that, a lot of the money needs to be decentralized effectively, but oftentimes it isn’t,.

RAJAGOPALAN: How much of the power and inequality is also because you have a small group of rich farmers with large land holdings who are able to organize better and either lobby for more subsidies or to continue the existing subsidies? Something that we did see in a small part of the farmers’ protests about taking away minimum support price eventually in the future, versus how much of that inequality is just because of the way these policies are implemented on the ground, because that’s another thread that’s running through your dissertation.

MURALI: I think the capture of the scene by the larger farmers is definitely something that distorts a lot of the numbers that come out of agriculture. In that sense, there is definitely a divide between, say, the small and marginal farmers versus the large. In saying that, there are also lots of divisions between chemical farmers and organic farmers. Like I said, a lot of these inequalities come into play.

When it comes to, say, the small and marginal farmers, their needs are very different than those of the large farmers. That inequality I think it definitely has a big role. The failure to organize amongst the smaller farmers has really, I guess, negated the ability for them to champion for more things on a political level. What they tend to do instead is turn to more autonomous means of organizations. In that sense, things like social media, that’s really come up in the agricultural scene in rural Tamil nadu. They turn to places like Facebook Marketplace to sell their produce because they just can’t rely on the state apparatus anymore.

Any subsidy or funding that is given privileges the large farmer who can afford to go to officials and talk to them and get their produce sold first, and these guys are just left in the lurch. Social media is a way that they try to air their grievances, but again, it’s not really a way for them to organize. It’s pretty personal. Sure, you might have camaraderie with someone who comments on your post, but then you’re not really a community that’s going to come together.

RAJAGOPALAN: On this, again, when it comes to small farmers, given that you’ve done so much field work and you’ve been on the ground and you’ve recorded interesting stories about what you’ve learned from the farmers, how many of them just want to exit agriculture and are trapped in it in some way? In the sense that there aren’t too many other opportunities, the system doesn’t quite work for them, but this is all they know and their largest asset as this piece of land, and so they’re chugging along.

MURALI: Yes, definitely. For those who can find a way out, they are finding that way out. They’re really trying their best. Even some of the farmers that I spoke to, when I had a personal conversation with them, they’re saying things along the lines of, "I don’t want my kids to take up agriculture because it’s just too difficult. I don’t want my kids to go through that hardship. I really want them to study and get married, move to the city, and not have to face the issues that we face." I haven’t even touched on things like people encroaching on their land or using their water or things like that. It’s such a difficult form of livelihood that if there’s a way out—they’re getting out.

I’ve seen cases where people open up resorts in their farm so that they can make another kind of living that is not to do with the vagaries of agriculture. Whoever can move out is moving out. Interestingly, I spoke to a couple of people who were businesses that bought from farmers. The way that they speak, it doesn’t give us much hope for the farmers either. They say things along the lines of, "Yes, sure, I procure cotton from the small farmers in Tamil Nadu."

When you ask them things like, "Oh, but then how does that work when there’s a drought or a cyclone? Then what do you do?" They’re quick to say that, "Oh, if the Tamil Nadu farmers can’t produce, then we turn to those in Maharashtra. They’re very quickly ditched in the grand scheme of things. I think that lack of support from businesses, from the government, all point them towards the direction of let’s get out of this profession, and if we can’t, let’s at least get our kids out.

The Unintended Consequences of Government Subsidies

RAJAGOPALAN: One point of difference between the lens you use in your dissertation and one that I personally have is, to my mind, a greater degree of decentralization will help farmers exit agriculture because, to me, local governments maintaining better land records, for instance, will help them sell their land and get good value. That’s just one example.

Or local governments actually ensuring that they have proper public goods, proper irrigation can help with land pooling. Again, smaller farmers may pool their land or exit agriculture altogether. Your view, especially as I read more of your dissertation, was that decentralization will actually help support farmers and keep them in the agricultural business. Is this a fundamental difference? Which way do you see this going if the system actually decentralizes to the point where you would want it to?

MURALI: I think there are definitely two ways of looking at it. I get to this at the conclusion in saying that, sure, if decentralization works out to the way that I think it should, which is that policies trickle down effectively and everybody reaps the benefits of the policy as they’re intended to, then people might stay in it more for the fact that they’re being supported by the government. You see this in a lot of other countries, especially in the West.

An interesting way of looking at it that is different is that maybe the way that I’m talking about it where we see farmers wanting to leave the profession is the fact that decentralization has actually fully done its job. The process has effectively decentralized to the point, the farmer, where now they are taking matters into their own hands and doing what they think they need to do in order to get the money that they need to sustain every day. It is ironically this sense of what began as a very traditional livelihood where you start producing small land, you start producing for a family, and then you start to build it up for your extended family, friends, and so on.

It was more of a communal thing, but now it’s become such and what I term it is this thing called capitalist capture where capitalism has basically captured every single facet of agriculture from things like how they pump water all the way down to the choice of crop that they choose to do. In that sense, you could say that decentralization has effectively done its job and it’s gotten down to the level of the farmers where they are independent decision makers.

RAJAGOPALAN: It’s funny that you say that it’s the capitalist capture because, to me, all the capture is over government subsidies. It’s not over the capture of the market. It’s odd the way economists versus political scientists use this phrasing. I fully agree with you that there is a capture involved, and there are large farmers who are capturing a very large share of the amount that’s spent on agricultural subsidies, which are between 2% to 2.5% of the GDP. Agricultural subsidy is a pretty large bill, fiscally speaking, and it’s been captured by the richest farmers. It’s odd to me that that’s characterized as a capitalist capture because to me that means markets. Can you just talk a little bit more about that?

MURALI: Yes. Basically, this was not something that I was intending to look at, but it just came up because it seems like the same forces that the farmers are turning against. They critique the fact that the government wants them to produce more and more, the productivity needs to increase, yield needs to increase, and all these kinds of metrics of measuring productivity, and the productivity of the land is steeped in capitalist market forces. You determine something’s effectiveness based on these and these metrics. These are some of the things that the farmers are going against. They’re saying, "You’re really pushing me to produce more and more, and that makes me—"

RAJAGOPALAN: None of these metrics are actually given by the market, right? They’re all metrics given by the government.

MURALI: Exactly. Yes, exactly. The farmers’ critique to the government is that you’re saying that I need to produce more and more, and yet eventually they turn to this market process that make them do the same thing on another level. Basically, it’s the sense that the same reason that they turn against the government for is the same thing that they are doing.

While the government says that you need to produce more, you need to be more productive with your use of land, and they’re not happy with that, but that’s exactly what they’re doing. They’re trying to increase their productivity, they’re trying to increase their yield by doing things like digging more groundwater. Accessing more of the groundwater, using more irrigation.

For example, when you talk about, say, pumping behavior, a lot of the things that they do is—one example that was given to me was this thing where they were talking about electricity subsidies. They were saying how, because of the subsidy, so long as there’s a motor, people just let the pump go on forever. Even things like the pumping behavior, the fact that they utilize it so much to increase their productivity, it’s almost like what you’re saying you’re not happy with is what you’re still doing nonetheless, but you’re just selling it to a different audience this time.

RAJAGOPALAN: To me, that is completely bad incentive set up by poorly designed government subsidies, which shouldn’t exist. To me, in fact, it’s the absence of market forces. It’s the absence of capitalism that is leading to that outcome as opposed to the capture of capitalism. I think in terms of process, I agree that that’s exactly how it’s playing out.

Navigating Local Realities for Sustainable Policy Implementation

RAJAGOPALAN: Now, once again, going back to the core theme of your dissertation, which is about decentralization, is there one thing that you would recommend that would improve matters substantially when it comes to agriculture? If there is one set of decentralized features that we need that the state of Tamil Nadu or any other state government should implement, what would that be?

MURALI: I think it would just be being more localized and understanding the context that you are working within. This was heavily influenced by this author called James Ferguson. I think he wrote a book called Anti-Politics Machine. Basically, this book, while it suggests a lot of other things, he also talks about how when the USAID came to work in Lesotho for a project, they designed the schemes that were to be implemented under something called the Africa Desk, which was for every single African country, basically.

Even though the local context of Lesotho was very different from the local context of Tanzania, the policies that were implemented were very similar and so they didn’t work. They worked in Tanzania, but they didn’t work in Lesotho because just the context is so different. That’s just something that I think really needs to factor into any kind of policy decision. This kind of the importance of locality is really important.

RAJAGOPALAN: I completely agree. When I was reading that portion of your dissertation, I kept thinking of James C. Scott and his wonderful book Seeing Like a State. It was like, "Oh boy, this is all over our agricultural policy. We’re just trying to treat a country that is so diverse and so plural, and agriculture, which is so diverse based on region, through this kind of centralized mandate, which makes no sense at the local level." I completely agree with that. Thank you so much for doing this. This was such a pleasure. It’s an excellent dissertation helping us learn more about agriculture. What are you working on next?

MURALI: The plan is to convert this dissertation into a book. Hopefully, add in more anecdotal stories that I find fascinating, and I hope the readers do as well, and trying to build more in this domain of agriculture and climate change.

RAJAGOPALAN: Great. Thank you so much for doing this, Vani. This was such a pleasure.

MURALI: Thank you.